FFC - 1QCY23 Result Review, (AKD Off the Analyst's Desk Apr 27, 2023)
Fauji Fertilizer Company Limited (FFC) announced its 1QCY23 result today, where the company posted an unconsolidated NPAT of PkR7.7bn (EPS: PkR6.1), an increase of 48%QoQ and 24%YoY and in line with our expectations. Furthermore, the company announced an interim dividend of PkR4.3/sh, taking the company’s payout ratio to 70%.
- Revenue for the quarter clocked in at PkR36.4bn, an increase of 21%QoQ and 38%YoY and higher prices and better offtakes pushed the company’s topline upwards.
- Gross margins for the company have posted at 40.0% for the quarter, a notable improvement over the 32.2% recorded in the previous quarter and the 35.6% recorded in the SPLY.
- Operating Profit for the company has been recorded at PkR11.5bn, as operating expenses for the company have clocked in below expectations.
- Finance costs for the company have clocked in at PkR1.5bn, decreasing by 11%QoQ likely due to a reduction in ST borrowings, while increasing by 37%YoY compared to the PkR1.1bn recorded in 1QCY22.
- Other Income for the company has clocked in below expectations at PkR3.5bn, a decrease of 15%QoQ while remaining flat on the yearly basis.
- As mentioned in our preview, the management has chosen to decrease its payout ratio from ~77% in the last two quarters to 70% in 1QCY23. This is likely on the back of the expected increase in gas prices for the company from the Mari wellhead.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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