Corporate results: Engro Corp’s profit grows 3% in Jan-Sep

EPS amounts to Rs16.93, earnings clock in at Rs11.3b

KARACHI: Engro Corporation’s consolidated profit improved 3% year-on-year with profit for the nine-month period (Jan-Sept) clocking in at Rs11.32 billion on the back of increase in other income and lower finance cost, according to a bourse filing Thursday.

The corporation had earned an after-tax profit of Rs11.02 billion in the corresponding nine months in 2015.

Earnings per share (EPS), however, dropped to Rs16.93 in the period under review from Rs16.95 in the corresponding period, Faiz Chapra, Company Secretary and Manager Legal of the conglomerate, said in a notification to the Pakistan Stock Exchange.

The EPS was calculated by excluding the profit attributable to non-controlling interest/other than owners of holding company. This resulted into lower EPS against higher consolidated profit.

Board of directors has recommended interim cash dividend of Rs8 per share. The entitlement would be paid to the shareholders whose names will appear in the register of members on December 19, 2016. The dividend was in addition to the one already paid at Rs12 per share in the prior six months.

However, its share price dropped 0.77%, or Rs2.20, and closed at Rs280.66 with a volume of 2.84 million shares at the Exchange.

During 9M2016, revenue of the corporation declined 14% year-on-year basis to Rs107.83 billion mainly on the back of weak fertiliser performance and a much more competitive environment in Engro’s food business, said Zawwar Taufiq, an analyst at Topline Securities.

Other income increased over two-fold from Rs2.39 billion in the nine-month period last year to Rs5.57 billion in the period under review. Finance cost slashed 31% from Rs6.51 billion to Rs4.49 billion.

In the last quarter (Jul-Sept) alone, the corporation earned a consolidated profit of Rs4.41 billion, which was three-times higher than Rs1.46 billion earned in the same quarter last year. Accordingly, the EPS comes at Rs5.85 as compared to Rs1.67 in the corresponding quarter.

“To recall, Engro booked a loss on its rice processing plant in 3QCY2015 of Rs2.1 billion which kept the company’s profitability under pressure last year. The dramatic increase in earnings is attributable to the aforementioned factor,” the analyst said.

Published in The Express Tribune, October 28^th, 2016.

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