Fauji Fertilizer Co. (FFC): 3Q2020 EPS at Rs3.64, up 30% YoY (inline with industry expectations)
- Fauji Fertilizer (FFC) announced its 3Q2020 financial result today, where the company booked unconsolidated profits of Rs4,628mn (EPS: Rs3.64) compared to Rs3,563mn (EPS: Rs2.80) in 3Q2019, up 30% YoY.
- It takes 9M2020 earnings to Rs13,764mn (EPS: Rs10.82), up by 10% YoY.
- Alongside result, the company announced interim cash dividend of Rs2.55/share, slightly lower than our expectation of Rs2.75/share. It takes total cash dividend to Rs7.80/share in 9M2020.
- Revenues of the company declined by 7% YoY to Rs24,636mn in 3Q2020 amidst decline in Urea offtake by 3% YoY and average Urea prices by 14% YoY.
- However, DAP sales increased by 25% YoY to 93k tons in 3Q2020, while average prices declined by 3% YoY.
- Gross Margin increased by 7.8ppts YoY to 33.6% in 3Q2020 from 25.7% in 3Q2019.
- Finance costs decreased by 51% YoY to Rs271mn in 3Q2020 amidst lower borrowing and interest rates.
- Similarly, Other Income declined by 39% YoY to Rs951mn in 3Q2020 mainly due to lower interest rates.
Effective tax rate clocked in at 29.9% in 3Q2020 vs. 31.5% in 3Q2019.
Fauji Fertilizer is engaged in the manufacturing, purchasing and marketing of fertilizers including the investment in other fertilizer manufacturing operations. As of Dec 31 2004, Co. had a design capacity of 2,455,000 tonnes for urea production and 445,000 tonnes for DAP production.
Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.
Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.
Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.
JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).
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