AIRLINK 62.48 Increased By ▲ 2.05 (3.39%)
BOP 5.36 Increased By ▲ 0.01 (0.19%)
CNERGY 4.58 Decreased By ▼ -0.02 (-0.43%)
DFML 15.50 Increased By ▲ 0.66 (4.45%)
DGKC 66.40 Increased By ▲ 1.60 (2.47%)
FCCL 17.59 Increased By ▲ 0.73 (4.33%)
FFBL 27.70 Increased By ▲ 2.95 (11.92%)
FFL 9.27 Increased By ▲ 0.21 (2.32%)
GGL 10.06 Increased By ▲ 0.10 (1%)
HBL 105.70 Increased By ▲ 1.49 (1.43%)
HUBC 122.30 Increased By ▲ 4.78 (4.07%)
HUMNL 6.60 Increased By ▲ 0.06 (0.92%)
KEL 4.50 Decreased By ▼ -0.05 (-1.1%)
KOSM 4.48 Decreased By ▼ -0.09 (-1.97%)
MLCF 36.20 Increased By ▲ 0.79 (2.23%)
OGDC 122.92 Increased By ▲ 0.53 (0.43%)
PAEL 23.00 Increased By ▲ 1.09 (4.97%)
PIAA 29.34 Increased By ▲ 2.05 (7.51%)
PIBTL 5.80 Decreased By ▼ -0.14 (-2.36%)
PPL 107.50 Increased By ▲ 0.13 (0.12%)
PRL 27.25 Increased By ▲ 0.74 (2.79%)
PTC 18.07 Increased By ▲ 1.97 (12.24%)
SEARL 53.00 Decreased By ▼ -0.63 (-1.17%)
SNGP 63.21 Increased By ▲ 2.01 (3.28%)
SSGC 10.80 Increased By ▲ 0.05 (0.47%)
TELE 9.20 Increased By ▲ 0.71 (8.36%)
TPLP 11.44 Increased By ▲ 0.86 (8.13%)
TRG 70.86 Increased By ▲ 0.95 (1.36%)
UNITY 23.62 Increased By ▲ 0.11 (0.47%)
WTL 1.28 No Change ▼ 0.00 (0%)
BR100 6,944 Increased By 65.8 (0.96%)
BR30 22,827 Increased By 258.6 (1.15%)
KSE100 67,142 Increased By 594.3 (0.89%)
KSE30 22,090 Increased By 175.1 (0.8%)

Engro Fertilizers Limited announced its 1QCY21 financial results and there was plenty to cheer for the shareholders – as the fertilizer giant reported a tenfold increase in after-tax profits, accompanied with interim cash dividend of Rs4/share. You would be well within your rights if you mistake the last year’s same period financials for some other company. Such is the turnaround.

All good things start from the top they say. The topline almost trebled on the back of strong volumetric sales and much improved retention prices. The urea sales increased by a mammoth 244 percent year-on-year clocking in at 0.58 million tons. The company management attributes the increase to much improved farm economy and large carryforward inventory. There was significant surge in DAP off-take as well, which went up 82 percent year-on-year to 62 thousand tons for the period. The DAP prices have been hovering around all-time highs, which partly explains the fat topline growth.

There were gains to be had on other fertilizer variants such as NP and NPK, contributing towards improved gross profit margin, which went up to 39 percent, up by 560 basis points year-on-year. The reduced finance cost aided by significant reduction in interest rates and reduced working capital requirement of the company, ably supported the bottom-line.

Going forward, EFERT stands to face significant downside in the primary margins, as the concessionary feedstock gas would be discontinued. The company is reportedly in negotiations with stakeholders about possible extension of concessionary gas beyond June 2021. Improved wheat and sugarcane farm earnings are likely to keep the fertilizer demand going in the upcoming crop season.

Comments

Comments are closed.