Fauji Foods sees turnaround, earns Rs605mn in 2023

Fauji Foods Limited (FFL), a subsidiary of Fauji Fertilizer Bin Qasim Limited, witnessed a turnaround in its financial performance, as the company’s profit-after-tax (PAT) clocked in at Rs605 million during the year ending December 31, 2023.

In the same period last year, FFL posted a Loss After Tax (LAT) of Rs2.17 billion.

According to a notice to the Pakistan Stock Exchange (PSX) on Tuesday, the board of directors met on January 23, 2024, to review the company’s financial and operational performance and announced a nil cash dividend.

Earnings per share (EPS) were recorded at Re0.26 in 2023 as compared to LPS of Rs1.37 in the same period last year (SPLY).

During the calendar year, FFL saw its revenue rise to Rs19.81 billion compared to Rs12.35 billion in SPLY, which is an increase of more than 60%.

Subsequently, the company’s gross profit increased by nearly 208%, clocking in at Rs2.98 billion in 2023, compared to Rs968.7 million in SPLY.

FFL’s ‘other income’ also increased to Rs238.5 million in 2023, compared to Rs199.4 million in SPLY, an increase of nearly 20%.

However, its finance cost reduced dramatically from Rs1.26 billion in CY2022 to Rs323.8 million in CY2023, helping the surge in the bottom-line.

However, the company saw a massive rise in its other expenses, which clocked in at Rs577.9 million in 2023, up over 333%, as compared to Rs133.3 million in 2022.

The company’s management in its brief commentary projected that the investment in brands and distribution infrastructure should continue to fuel the growth.

In Q4 2023, FFL received the board and shareholders’ authorizations to acquire Fauji Cereals and Fauji Infraavest (Pasta).

“The compelling synergies across the three businesses will broaden the margin base and improve the P&L structure… The acquisitions, once completed (post statutory approvals), are expected to be EPS accretive,” the company said.