Fauji Cement’s profit jumps 19% to Rs824m

However, the result is below market expectation

Our Correspondent February 20, 2018
However, the result is below market expectation PHOTO: FAUJI CEMENT

KARACHI: Fauji Cement Company Limited (FCCL) posted a net profit of Rs824 million in the quarter ended December 2017, up 19% compared with Rs694 million in the same period of last year, according to a company notice sent to the Pakistan Stock Exchange (PSX) on Monday.

Earnings per share (EPS) jumped to Rs0.60 compared to an EPS of Rs0.50 in the corresponding period of previous year. According to an AKD Research report, the result was below expectations.

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The report said the result in the second quarter of fiscal year 2018 was below its projected net profit of Rs1.08 billion (EPS Rs0.78) owing to a six-percentage-point deviation in gross margins mainly on account of delayed commencement of clinker production from line-II against expectations.

The KSE-100 Index closed at 43,572, down 54 points or 0.12%. Fauji Cement’s share closed at Rs25.65, down 3.1%.

Net profit in the first six months (July to December 2017) touched Rs1.27 billion, down 2.3% compared with Rs1.30 billion in the same period of previous fiscal year. EPS declined to Rs0.92 from Rs0.94.

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Key highlights of the second quarter were 6% year-on-year decrease in top line due to lower cement prices, despite a healthy growth in dispatches.

Moreover, there was a 4.3-percentage-point year-on-year improvement in gross margins to 26.2% primarily on account of commencement of clinker production from line-II and lower effective tax rate of 28% in the second quarter compared with 32% in the same quarter of FY17.

Published in The Express Tribune, February 20th, 2018.

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