Strong Sales led Fatima Fertilizer to post Rs. 7.5 billion Half Year Profit

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Strong Sales led Fatima Fertilizer to post Rs. 7.5 billion Half Year Profit

Fatima Fertilizer Company Ltd (FATIMA) announced 1H2019 Net Profit of Rs.7.53bn (EPS: Rs. 3.59), up 19% YoY. The net profit remained above analysts expectations due to lower effective tax rate.

The increase in net profit was due to 16% higher Sales Revenue due to as Urea/CAN offtake increased, along with higher retention prices. Net Sales increased to Rs. 26.8 billion in half-year period ending June 2019. Furthermore, Selling and distribution expense also decreased by 24% as the company rationalized its distribution channel. While other income increased by 93% to Rs. 684 million. Meanwhile, 109% YoY higher finance cost amid interest rate hikes was a major earnings dragger during the period.

Rupees in Million  1HCY19   1HCY18  % Change
 Net Sales  26,808 23,101 16%
Cost of Sales  11,466 9,343 23%
Gross Profit  15,341 13,759 12%
Administrative Expenses  1,224 1,015 21%
Selling & Distribution Expenses  1,790 2,351 -24%
Operating Profit  12,328 10,393 19%
Other Income  684 354 93%
Other Charges  1,053 794 33%
Financial Charges  1,340 640 109%
Profit before Taxation  10,619 9,312 14%
Taxation  3,088 2,976 4%
Net Income  7,532 6,337 19%
EPS  3.59 3.02 19%

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