The revenue of fertiliser sector fell by 13.4 percent to Rs 23.62 billion in the first half of the current calendar year 2007 as against Rs 27.27 billion earned in the corresponding period in 2006.
The overall production and off take of the fertiliser sector declined by 4 percent and 10 percent to 293 million tons and 3.08 million tons respectively in the period under review, which reduced the revenue of the sector in this period.
"The cost on the other hand declined by 13.6 percent to Rs 16.01 billion mainly because of 10 percent reduction in fuel gas charges of the sector at the start of the year," Hettish Karmani an analyst at Atlas Capital Markets said. Other income earned through share of profit from associates, dividend income and return on cash deposits was down 7.5 percent to Rs 2.31 billion whereas financial charges grew by 71 percent to Rs 1.31 billion, he added.
All this resulted in a drop in the bottom line of the sector by 174 percent to Rs 4.52 billion as against Rs 5.47 billion during the corresponding period of last year.
Engro Chemicals Limited: ECL earnings for the first half of 2007 rose by 17 percent to Rs 1.103 million (EPS: Rs 6.56) as against Rs 945 million (EPS; Rs 5.61) earned in the same period in 2006. Profitability remained buoyant on the back of rising DAP and urea prices along with healthy dividends from Engro Polymers & Chemicals Limited. The company also announced dividend of Rs 2 per share with the results.
Fauji Fertiliser Company Limited: FFC''''s earnings were up by 9 percent to Rs 2.385 million (EPS: Rs 4.83) as against Rs 2.191 m (EPS: Rs 4.44) in the same period last year. Despite a 20 percent reduction in top-line, the company was able to achieve a growth in its bottom-line on the bock of an increase in other income. As expected the company announced a dividend of Rs 2.25 per share.
Fauji Fertiliser Bin Qasim Limited: FFBL''''s net revenue declined by 33 percent to Rs 3.94 billion due to a decline in Urea and DAP off take by 39 percent and 6 percent to 155,000 tons and 143.7000 tons respectively. Higher phosphoric acid price coupled with a rise in repairs and maintenance cost resulted in a decline in grass profit.
Other income apart from Government of Pakistan compensation of Rs 600 million rose by 25 percent to Rs 338 million, which supported the bottom line. FFBL announced PAT of Rs 533 million (EPS: Rs 0.57) for the first half of 2007, was down by 46 percent from Rs 992 million (EPS: Rs 1.06) earned in the same period in 2006. The company also declared an interim dividend of Rs 0.05 per share.
Dawood Hercules Limited: DHL''''s earnings declined by 63 percent to Rs 500.4 million (EPS: Rs 6.04) in 1H/CY07 when compared to Rs 1.345 million (EPS: Rs 16.23) in 1H/CY06.
The drop emanated from a 20 percent plunge in the top line of the company along with 92 percent fall in other income and 9 percent reduction in the share of profit from associates. The company announced a dividend of Rs 1.5 per share with the result.