Engro Powergen Qadirpur Limited (PSX: EPQL) has recently announced its financial results for the second quarter of the calendar year 2024 (2QCY24), reflecting significant performance improvements.

EPQL’s sales in 2QCY24 fell by 5 percent from the same quarter last year. However, the cost of sales for the same period also fell by 7 percent year-on-year. The company’s gross profit for the quarter ended up slightly low by one percent year-on-year. However, the quarter-on-quarter improvement in gross profit was largely due to a higher PWF, which adjusts the capacity component of the plant’s revenue.

Administrative expenses dropped significantly during the period representing a 38 percent year-on-year decrease, which helped the company’s earnings: Operating profits grew by 4 percent year-on-year due to the company’s improved operational efficiency and cost management strategies.

Finance income also grew, supported by higher penal income and lower finance costs during the quarter. EPQL reported an earnings growth of 31 percent year-over-year driven primarily by reduced administrative expenses during the quarter.

Overall, in 1HCY24 as well, EPQL’s revenues fell but the bottm line witnessed a growth. The power company’s sales revenue decreased by 7 percent year-on-year while the earnings jumped by 32 percent for the same period. The same factors led to the growth in operating profits and net earnings for the company during 1HCY24. EPQL’s margins - gross and net – saw improvement in both the latest quarter and 1HCY24.

EPQL declared a dividend of PKR 3.50 per share in 2QCY24, surpassing expectations based on its historical payout trends.

Engro Powergen Qadirpur Limited is built on a 217 MW combined cycle power plant near Qadirpur on low BTU Permeate Gas from OGDCL’s Qadirpur gas field. It reached Gas Insufficiency Phase in 2018 due to Qadirpur gas field depletion. The company operates its plant on High-Speed Diesel (HSD) up to the extent of shortfall of permeating gas and is actively exploring local gas supply sources to meet the fuel shortage. Recently, it has been seeking to buy low BTU gas from PPL’s Kandhot field.