Engro Fertilizers Ltd. has announced a profit of Rs. 4.41 billion for the third quarter that ended on September 2021.
The profits declined by 37% as compared to Rs. 7.03 billion in the same period last year. This took the company’s nine months profit to Pkr. 14.92 billion, up by 30 percent as compared to Rs. 11.49 billion in the same period last year.
Along with the result, Engro Fertilizers Ltd. (EFERT) announced an interim cash dividend of Pkr. 3.50 per share — 35%. This is an addition to the interim cash dividend already paid at Rs. 8 per share. A higher payout vis-à-vis earnings is due to the management accounting for non-cash items related to credit loss and the discounting of accounts.
The net sales of the company during the third quarter were reported at Pkr. 37.38 billion as compared to Pkr. 37.43 billion in the same period last year.
According to a report by Foundation Securities, the decline in 3rd Quarter 2021 profitability was due to a lower Urea/DAP offtake, higher other operating expenses due to the reversal of the Gas Infrastructure Development Cess (GIDC) remeasurement gain, and the ending of concessionary gas on feedstock gas.
EFERT has started to accrue concessionary gas on fertilizer policy rates from 3rd Quarter 2021. The annualized impact of the same is close to Pkr. 3.3 billion on the net earnings, according to a report by Topline Securities. It has also recorded the unwinding of the GIDC to the tune of Pkr. 270 million in 3rd Quarter 2021.
EFERT’s earnings per share were reported at Pkr. 3.30 as compared to Pkr. 5.27.