Engro Fertilizers Limited (EFERT) has announced its financial results for the first nine months of the calendar year 2024, revealing a consolidated profit after tax (PAT) of Rs. 17.980 billion. This translates to an earnings per share (EPS) of PKR 13.47, marking a 20% year-on-year increase from Rs. 15.045 billion (EPS: PKR 11.27) in the same period last year.

Despite the positive annual growth, the company’s consolidated earnings for the third quarter of CY24 saw an 11% decline, with profits at Rs. 8,554 million (EPS: PKR 6.41). Alongside these results, Engro Fertilizers announced a cash dividend of PKR 2.50 per share.

Key Financial Highlights:

Net Sales: The company reported net sales of PKR 171,845 million for 9MCY24, a 16% increase year-on-year. This growth is attributed to a 51% and 15% rise in urea and DAP prices, respectively, along with a 20% increase in DAP offtake. However, urea sales declined by 23% due to a 58-day closure of the EnVen plant for maintenance.

Quarterly Performance: In the third quarter, net sales decreased by 11% year-on-year, reaching PKR 58,641 million, due to a 33% and 14% fall in urea and DAP offtake, respectively.

Gross Margins: The gross margins for 9MCY24 were 24.81%, compared to 29.08% in 9MCY23. The quarterly gross margin remained stable at 31.22% amid higher urea prices.

Other Income: Other income rose by 27% year-on-year to PKR 2,414 million, driven by increased income from cash and cash balances. In the third quarter, other income was PKR 383 million, down 48% due to lower interest income.

Finance Costs: Finance costs increased by 63% year-on-year to PKR 2,661 million in 9MCY24, due to higher interest rates. In the third quarter, finance costs surged by 155% year-on-year to PKR 1,276 million, owing to a rise in short-term borrowings.

Taxation: The effective taxation rate remained unchanged at 39% in the third quarter of CY24.