HUBC - 1QFY24 Result Review - Strong payout, continues cash rich stance, (AKD Off the Analyst's Desk Oct 25, 2023)
AKD, Off the Analyst's Desk
HUBC - 1QFY24 Result Review - Strong payout, continues cash rich stance
The Hub Power Company (HUBC) announced its 1QFY24 result earlier today, where the company reported consolidated quarterly earnings of PkR17.1bn (EPS: PkR13.17), changing by –29%QoQ/+88%YoY, inline with our expectations of EPS: PkR13.24/sh for the quarter. In addition to this, company also announced a cash dividend PkR5.0/sh for the first quarter.
- Consolidated revenue for the quarter clocked in at PkR33.7bn, up by 4%QoQ as generation from subsidiaries/associate power plants remained strong. Overall, Base/CPHGC/TEL/TNPTL/Narowal/Laraib’s load factor stood at 0%/15%/91%/87%/22%/34% during the quarter. Furthermore, revenues remained up during the period due to slight currency deprecation as well, as the avg. PkR/USD parity weakened by 2% between 4QFY23 and 1QFY24, contributing towards growth in capacity charges.
- Share of profit from associates jumped significantly on an YoY basis, up by 290%YoY, clocking in at PkR12.0bn. Overall, inclusions of ThalNova plants during the previous year alongside possible inclusions of ENI and SECMC profits are likely to have contributed to the sharp increase during the period
- Operating expenses clocked in at PkR458mn, witnessing an increase of 46%YoY, possibly attributed to heightened inflation.
- Finance costs remained largely flat on a QoQ basis, clocking in at PkR7.07bn during the quarter, however up by 2xYoY. This is likely on the back of higher borrowings to finance the newly operational Thalnova plant alongside higher reliance on ST borrowings amidst tighter working capital situation.
- The company has also announced a dividend of PkR5.0/sh for the quarter, above our expectations of PkR3.0/sh.
AKD Research
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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