Engro Fertilizer’s net profit declined by 30.6% to Rs 2.1 billion during January-March quarter of 2016, the company revealed in its financial report to the Pakistan Stock Exchange on Tuesday.
The company reported an after-tax profit of Rs 2.1 billion, down 30.6% from Rs 3.05 billion during the same quarter of 2015. The earnings per share decreased from Rs 2.3 to Rs 1.5.
Topline Securities said: “The decrease in profit can be ascribed to decline in urea off-take and prices.”
However, the result was marked above market expectations by Topline Securities.
The company’s share price increased by Re 0.13 or 0.18% from the last day’s price (Rs69.19) and closed at Rs 69.32 per share. A total of 1,822,000 shares of Engro Fertilizers changed hands by the end of the market on Monday.
A subsidiary of Engro Corp, Engro Fertilizers reported Rs 12.6 billion in revenues during the first quarter of the year, a decrease of 40.1% compared to Rs 17.6 billion it earned in sales during the corresponding period of 2015.
The company’s gross margin, on the other hand, clocked in at 39.22% during the quarter, up by 1 percentage point from 38.30% of the same quarter of 2015.
The increase in gross margin, as said by Topline Securities, was because of EnVen plant and its subsidized gas, which came online in March of last year. However, if Enven is excluded, EFERT’s margins compressed due to higher fuel and feedstock prices.
“The distribution cost declined by 22% YoY to Rs 856 million during the first quarter of 2016 primarily due to lower sales,” it added.
