The Board of Directors of Engro Corporation Limited Friday announced the financial results for the year ended December 31 last year.
Engro Corp posted a record 2013 consolidated profit after tax of Rs 8.183 billion versus depressed profit after tax of Rs 1.333 billion in 2012.
The company achieved PKR 155,360 million revenue in 2013 vs PKR 125,151 million in 2012. The record profitability was achieved by a turnaround in its fertilizer business coupled with an impressive performance by Polymer, a healthy contribution by Vopak and EXIMP’s return to profitability.
The corporation’s total shareholder return of 72 percent during 2013 was higher than the returns provided by KSE. As a result of the improved financial performance, PACRA upgraded the company’s entity rating from ‘A’ to ‘AA-‘during the year. The company also announced an EPS of Rs. 16.01 for the year ended December 31, 2013 as opposed to the EPS of Rs. 2.61 in 2012. It resumed dividend payment with a novel specie dividend of 1 Engro Fertilizers share for every 10 shares of Engro Corp.
During 2013, the company made a profit after tax of PKR 5,497 million vs. a loss of PKR 2,935 million last year. Engro Fertilizers revenue for the year was PKR 50,129 million vs. PKR 30,627 million in 2012.
The Company’s blended fertilizers’ (Zarkhez & Engro NP) sales for the year increased by 21 percent to 95 k tons compared to 80 k tons during 2012. Pakistan’s overall potash market remained stable at 20 KT (nutrient basis) during 2013. Our market share in potash industry increased from 40 percent last year to around 50 percent in 2013. Approximately 52,000 farmers were contacted through market development activities.
The company undertook successful Initial Public Offering (IPO) of 75 million ordinary shares in 4Q 2013. Out of these, 56.25 million shares were subscribed through Book Building process at a price of PKR 28.25 per share and the remaining were offered to the general public. Book Building and the public issue were both over-subscribed by 4 and 3 times respectively, which reflects investor confidence in the Company’s future. As part of the IPO structure, Engro Corporation Limited (ECorp) further divested 30 million shares of the Company. As a result of these transactions ECorp, subsequent to the balance sheet date, holds 91.91 percent of the share capital of the company.
The year 2013 was a test of the company’s resilience due to external challenges, coupled with distribution issues, which impacted its volumes and profitability. The revenue of Engro Foods declined from PKR 40,169 million in 2012 to PKR 37,891 million in 2013 and a decrease in net profit from PKR 2,595 million in 2012 to PKR 1,092 million in 2013 on a like for like basis i.e. excluding one-time charges impacting the profitability.
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