Karachi, July 28, 2022 (PPI-OT): Fertiliser – Engro Fertilizers Limited (EFERT)

Earnings: Engro Fertilizers Limited (EFERT) announced its results for the quarter ending June 2022. The company reported a loss of PKR 0.1bn (PKR 0.07/share) during 2QCY22 compared to last year’s PKR 4.8bn (PKR 3.6/share). This brings total profitability for 1HCy22 to PKR 5.4bn (PKR 4.05/share) down by 48%y/y compared to PKR 10.5bn (PKR 7.87/share) in the same period last year.

Operating performance: During the period under review, the Company’s net sales increased to PKR 38.3bn showing an increase of +48%y/y likely owing to higher Urea prices and offtake. Company gross margins decreased to 30.5% compared to last year’s 38% likely owing to higher gas prices; Company’s EBIT increased to PKR8.2bn (+11%y). However, EBIT margins deteriorated to 21.3% compared to last year’s 28.4%. Effective tax charge for EFERT increased to 101% versus last year’s 28% due to imposition of additional tax announced in Budget 2023.