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ENGRO_ 1HCY22 Analyst Briefing Takeaways ,(AKD Off the Analyst's Desk Aug 17, 2022)

AKD, Off the Analyst's Desk

ENGRO: 1HCY22 Analyst Briefing Takeaways

Engro Corporation Limited (ENGRO) conducted its analyst briefing where company shed light on recent result and its future outlook. Key takeaways from the briefing are as follows:

• Company has reported consolidated loss of PkR557mn (LPS: PkR0.97) in 2QCY22, as compared to profit of PkR8.7bn (EPS: PkR15.13) in SPLY. The reason for this massive decline in earnings is imposition of super tax.
• On standalone basis, company’s revenues increased by 92% as compare to SPLY, attributable to higher dividend income. Similarly, PAT increased by 29% on YoY basis.
• On consolidated business, topline grew by 27% YoY, however due to imposition of super tax PAT recorded a decline of 57% as compare to SPLY.
• EFERT has reported consolidated loss of PkR98mn (LPS: PkR0.07) in 2QCY22, as compared to profit of PkR4.7bn (EPS: PkR3.57) in SPLY. The reason for this massive decline in earnings is imposition of super tax. Production volume for urea clocked in at 1.11mn tons in 1HCY22 vs 1.07mn tons in SPLY. Urea offtakes for 1HCY22 clocked in at 1.09mn tons as compared to 1.16mn tons in SPLY
• EPCL reported PAT of PkR2.3bn (EPS: PkR2.4) in 2QCY22 vs PkR3.1bn (EPS: PkR3.3) in SPLY. The decline in earnings in mainly attributable to imposition of super tax. Feasibility study is underway for the de-bottlenecking of VCM production facility to 300KT.
• Company re-gasified 37 RLNG vessels vs 35 vessels in SPLY. Throughput by Engro Vopak clocked in at 724kt.
• Tenancy ratio of Enfrashare business clocked in at 1.14x during 1HCY22. Company’s currently has 2,937 operational sites vs 1,817 in 1HCY21. Enfrashare’s topline grew by 83%YoY. Company is aggressively pursuing growth and has reported a net loss. Management expects to achieve breakeven in next few years.
• EPQL witnessed a slide dip in profitability due to scheduled major inspection. As per management, company has received complete payment as per MoU.
• After the fire incident at EPTL, both units are operational at optimal capacity. In June, NEPRA has made few changes in EPTL’s tariff and company has filed an appeal for the resolution of this matter. Company expects to receive dividends from EPTL in 2HCY22.
• Company received PAT of ~PkR1bn from SECMC. Currently, SECMC phase III is under development stage. 
• Feed study for PDH and PP complex is underway and management expects to receive the result in 3QCY22. After the assessment of feed study company will decide the future of this project.
• Company is working on setting up a renewable energy park with capacity of 400MW. Company have signed multiple MoUs and LOIs with different companies.

 

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