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Corporate results: FFC sees slight dip in profit

January 30, 2014

Our Correspondent

Fauji Fertilizer Company (FFC) has posted a net profit of Rs20.13b in the year ended on December 31, 2013 , down 3.5% from Rs20.86 billion in the previous year. Earnings per share (EPS) of the company were at Rs15.83 in year 2013, down 3% compared to an EPS of Rs16.38 the in previous year. The result was also accompanied by a final cash dividend of Rs4.00 making full year cash dividend of Rs15.35 per share. Due to stagnant volumetric off-take of 2.4 million tonnes and stable urea price in 2013, the company’s sales revenue remained flat at Rs74 billion . However, higher increase in cost due to rise in fuel cost contracted gross margins by 2 percentage points to 46% in 2013 as against 48% in previous year, Topline Securities reported on Wednesday. Furthermore, higher distribution cost (up 11% to Rs6.1 billion ) also heavily restricted bottom-line of the company. In fourth quarter of 2013 (4Q2013), FFC posted an EPS of Rs4.12 , down 25% as against an EPS of Rs5.53 in the same period last year as company sold 21% more urea in 4Q2012 due to heavy stocks of previous months. ”We expect FFC’s margins to take a hit in first three months (January-March) of 2014 due to a recent hike in Gas Infrastructure Development Cess (GIDC). It is expected that the companies would gradually increase urea prices to pass on the impact of GIDC to consumers,“ AKD Research commented.


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Source: Express Tribune (Pakistan)


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