FFBL posts loss of Rs3.5 billion in FY19

Decline comes on back of dip in gross profit, uptick in finance cost

Our Correspondent July 27, 2019

PHOTO: REUTERS

KARACHI: Fauji Fertiliser Bin Qasim (FFBL) posted a loss of Rs3.5 billion in the year ended June 30, 2019 due to decline in gross profit and surge in finance cost.

The company had recorded a loss of Rs1.6 billion in the previous year, according to a company notice sent to the Pakistan Stock Exchange (PSX).

Loss per share stood at Rs2.95 in FY19 compared to Rs1.25 in the previous year.

According to a Topline Securities’ report, the plunge came on the back of decrease in gross profit margins and increase in finance cost.

Finance cost jumped to Rs4.27 billion in FY19 from Rs2.26 billion in the previous year. The nearly 89% hike was recorded amid increase in interest rate and borrowing of the company.

“Food business of the company (Fauji Foods) posted a gross loss of Rs444 million (or 39% of sales) in 2Q2019 vs Rs29 million in the corresponding period of last year due to increase in the cost of production owing to rupee devaluation and tough competition from peers, we believe,” the report added.

Meanwhile, other income of the company increased 17% in the six-month period of 2019 to Rs1.29 billion from Rs1.10 billion in the previous year.

Despite the increase in other income, it could not provide an adequate buffer to the company’s bottom line, a Taurus Securities’ report stated.

Fauji Fertiliser’s stock price closed at Rs16.04 at the PSX, down Re1, with trading in 2.02 million shares. The KSE-100 index closed at 32,103.27 points, down 343.13 points on Friday.

Three-month period

FFBL recorded a loss after tax of Rs1.09 billion in the quarter ended June 30, 2019, compared to a loss of Rs1.23 billion in the same period of previous year.

The company’s loss per share was recorded at Rs0.55 in the Apr-Jun 2019 quarter compared to Rs0.99 in the previous year.

Published in The Express Tribune, July 27^th, 2019.

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