Corporate result: Fatima Fertilizer’s profit down 78%

Clocks in at Rs612m during Jul-Sep

KARACHI: Fatima Fertilizer posted a net profit of Rs612 million for the quarter ended on September 30, 2015, down by a significant 78% compared to Rs3.04 billion in the same quarter last year, according to a company notice sent to Karachi Stock Exchange (KSE) on Monday.

Earnings per share (EPS) of the company came down to Rs0.29 in the third quarter from Rs1.45 in the corresponding period last year.

During the third quarter of calendar year 2015 (3QCY15), revenues declined due to a drop in sales volume owing to uncertainty over the fertiliser relief package and expectation of reversal of urea price hike.

Some parts of the Kissan package were also suspended, which further fuelled uncertainty. The quarter also remained detrimental to cumulative nine months of calendar year 2015 (9MCY15) sales which decreased by 16% year-on-year (YoY).

Fertiliser production rose by 10% YoY in 9MCY15 but the benefit of this surplus inventory is expected to be yielded during the fourth quarter of calendar year 2015 (4QCY15), which is also the sowing season for Rabi crops.

The finance costs reduced in 9MCY15 due to repayment of long term finances and decline in interest rates owing to monetary easing by the central bank.

Taxation decreased due to decline in tax rate in the recent Finance Act. The company managed to improve its net margin on a cumulative basis due to improvement in other income derived from providing technical services outside Pakistan.

Published in The Express Tribune, November 3^rd, 2015.

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