Fauji Fertilizer Bin Qasim Limited (FFBL) has announced a remarkable financial performance for the first nine months of the calendar year 2024, posting a profit after tax (PAT) of Rs. 18.569 billion, translating to earnings per share (EPS) of PKR 14.38. This represents a staggering 52-fold increase compared to Rs. 354 million (EPS: Rs. 0.27) in the same period last year.
Quarterly, FFBL’s profitability rose by 51% year-on-year (YoY), reaching Rs. 8,009 million (EPS: Rs. 6.20) in the third quarter of 2024.
The company’s net sales increased by 13% YoY to Rs. 154,465 million in 9MCY24. According to Arif Habib Limited (AHL), this growth was driven by a 42% YoY increase in urea offtake and a rise in urea and DAP prices by 51% and 15% YoY, respectively.
During the third quarter, the topline declined by 18% YoY despite a significant 98% YoY growth in urea sales, attributed to higher urea production due to improved gas availability. This was accompanied by a 32% and 9% YoY increase in urea and DAP prices, respectively. However, DAP sales dropped by 37% YoY.
Gross margins improved significantly, standing at 22.17% during the first half of 2024 compared to 12.40% in the same period last year, due to a decline in phosphoric acid prices and higher DAP prices. In 3QCY24, gross margins increased by 977 basis points, reaching 24.55%, supported by higher urea sales and improved DAP margins.
Other income surged by 95% YoY to Rs. 12,289 million during the first half of 2024, driven by higher income from cash balances and dividend income from the associate company (AKBL) and joint venture (PMP). On a quarterly basis, other income rose by 27% YoY due to increased income from short-term investments.
Finance costs decreased significantly, falling by 62% YoY to Rs. 2,122 million during 9MCY24. In the third quarter, finance costs dropped by 67% YoY to Rs. 767 million, owing to reduced borrowings and lower interest rates.
The company reported an effective tax rate of 37% in 3QCY24, compared to 26% in the same period last year, reflecting changes in the tax landscape.
