Fauji Foods Limited (PSX: FFL) has announced a profit of Rs. 560 million for the nine months ending September 30, 2024, a significant turnaround from the Rs. 108 million loss recorded in the same period last year. For the third quarter of FY25, the company’s profit after tax (PAT) surged by 478% to Rs. 223 million, compared to Rs. 38.5 million in the same period last year.
Despite the impressive financial performance, the company did not declare any bonus shares or cash dividends for the period under review.
FFL’s financial results reveal a net revenue growth of 20%, reaching Rs. 17.8 billion during the first nine months of 2024, up from Rs. 14.8 billion in the same period of 2023. In the third quarter of FY25, revenue increased to Rs. 6.4 billion, compared to Rs. 4.0 billion in the same period last year.
The company attributed its success to the rapid growth of its Nurpur UHT milk brand, which recorded a 47% revenue increase over the nine months of 2024 compared to the same period last year. The strategic acquisition of a cereal business in February 2024 also contributed to portfolio diversification, strengthening FFL’s presence in the breakfast market.
FFL reported improved commercial sustainability, with gross margins rising from 11.9% in Q3 2023 to 14.8% in Q3 2024. The nine-month gross margin increased by 5% compared to the same period last year, reaching 18%. This improvement was driven by a focus on cost efficiencies and supply chain enhancements, resulting in an operating profit of Rs. 236 million in Q3 2024, up from Rs. 68 million in the same period last year.
However, the company faced a 163% increase in finance costs during the quarter, reaching Rs. 15.8 million, compared to Rs. 6 million last year. For the nine months, finance costs decreased by 88% to Rs. 40.5 million.
Marketing and distribution expenses rose by 38% to Rs. 456 million in the third quarter of FY25, and by 24.3% to Rs. 1.27 billion for January-September 2024. Administrative expenses increased to Rs. 262 million in the third quarter and Rs. 682 million for the nine months. Other income grew to Rs. 174 million in the third quarter and from Rs. 189 million to Rs. 366 million for the nine months.
FFL reported earnings per share of Rs. 0.22 for the nine months and Rs. 0.09 for the third quarter of FY25. As of Tuesday, the company’s stock was trading at Rs. 9.34, down by 0.21% or Rs. 0.02, with a turnover of 19.9 million shares.
