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|
|Cost of Sales||11,466||9,343||23%|
|Selling & Distribution Expenses||1,790||2,351||-24%|
|Profit before Taxation||10,619||9,312||14%|