Karachi: Fauji Fertilizer Company (FFC) held a corporate briefing to discuss its second-quarter 2026 financial results and future outlook. The company reported consolidated earnings of Rs22.4 billion, with earnings per share (EPS) increasing to Rs15.43 from Rs13.83 in the same period last year. A dividend of Rs14.5 per share was also announced.
According to JS Global, FFC's urea sales rose by 26% year-over-year, reaching 1,404k tons and boosting its market share by 8 percentage points to 56% in the first half of 2026. DAP sales also increased by 17% year-over-year to 163k tons, with a 2 percentage point market share rise to 65%. These increases contributed to a 28% year-over-year growth in net sales. The company reaffirmed its urea offtake target of approximately 6.6 million tons for the year, citing robust demand and stable inventory levels. However, the company indicated no further urea price hikes, while DAP prices remain uncertain due to escalating production costs driven by geopolitical disruptions affecting sulphur and phosphoric acid prices.
FFC's management also highlighted plans for a turnaround at the Mirpur Mathelo plant in September 2026 and announced the launch of six new specialty crop nutrition products in partnership with Yara International, anticipating a sales contribution of US$3 million for the rest of the year. The fertilizer business contributed 55% to profitability, followed by dividend income at 32% and investment income at 13%. The company reported receiving dividends of Rs12.5 billion from power investments, Rs3.4 billion from Allied Bank Limited, and Rs3.0 billion from PMP in the first half of 2026.
Despite an exceptional dividend payout of approximately 86% this year, management indicated that future payouts would realign with historical levels of around 75%. The acquisition of Pakistan International Airlines (PIA) is progressing as planned, with the first payment of Rs30.6 billion completed and the second tranche scheduled. The consortium holds a 66.67% ownership stake in PIA, with FFC's total committed investment at Rs63 billion.
The company also noted that it had not recorded any accounting gain from the Sindh Industrial Development Corporation (SIDC) settlement, as no agreement has been reached with the Sindh government. Additionally, the FFC management assured that the FFBL plant remains operational with a steady gas supply, although the Agritech (AGL) plant is shut down until August 15 due to RLNG shortages in the country.