SSGC half-yearly results on February 23

Sui Southern Gas profit in the first half of the current fiscal year may grow as much as 16 percent because of higher sales.
SSGC will hold board meeting for 1HFY04 results on February 23 (Monday). During 1HFY04, SSGC after-tax profit is expected to rise by 13 percent to 16 percent, to Rs 684 million to Rs 698 million, or earning per share (EPS) of Rs 1.02 to Rs 1.04, as compared to Rs 605 million or EPS Rs 0.90 during 1HFY03, a report of Investcapital Securities said.
"We expect the company to post profit after tax of Rs 376 million to Rs 389 million (EPS Rs0.56-0.58) during 2QFY04. At the current price level of Rs 34.90, SSGC is offering a FY04E dividend yield of around 6 percent."
The main reason behind the recent increased investor interest in SSGC is the overwhelming response received for the 5 percent IPO issue (with 5 percent green-shoe option).
IPO has been heavily oversubscribed with Rs 11 billion pouring in, as per provisional numbers.
According to a report of First Capital Equities prepared by Fawad Khan, the profit may grow by 4 percent to Rs 634 million in the first half of the running fiscal year.
Given history of paying out dividend with annual results, any possibility of dividend is ruled out.
The company carried out a significant expansion in the fourth quarter last year, benefits of which are expected to fully translate into appreciation of operating level profit as the utility earnings are anchored with average of net operating assets and deferred credits.
The company would be a clear beneficiary of government efforts to push gas as an alternative fuel, substituting imported oil. Moreover, continued expansion of its distribution lines would also result in higher sales.
Another major development explained by First Capital was the decline in financial charges. This is attributed to low interest rate environment and a favourable debt re-profiling of its foreign and local loans.