Engro Fertilizers Limited (EFERT), a subsidiary of Engro Corporation Limited, posted a profit after tax (PAT) of Rs8.55 billion for the third quarter ending September 30, 2024, reflecting an 11% year-over-year (YoY) decline compared to Rs9.58 billion during the same period in 2023, according to the company’s financial results released on the Pakistan Stock Exchange (PSX).
Despite the decline, EFERT’s earnings per share (EPS) stood at Rs6.41 in 3QCY24, higher than market expectations, which had estimated earnings close to Rs5 per share. This compares to Rs7.17 EPS recorded in 3QCY23.
Dividend Announcement and Revenue Decline
At its Board of Directors (BoD) meeting on October 14, EFERT announced an interim cash dividend of Rs2.5 per share (25%) for the third quarter. This follows an earlier interim dividend payout of Rs11 per share (110%).
On a consolidated basis, revenue dropped by 11% to Rs58.64 billion in 3QCY24, compared to Rs66.17 billion in the same quarter of 2023.
Profit Margin and Increased Finance Costs
Amid declining revenue, EFERT’s gross profit fell by 13% to Rs18.31 billion, down from Rs20.99 billion in 3QCY23. As a result, the profit margin narrowed to 31.2% from 31.7% in the previous year.
The company’s finance costs surged 155% to Rs1.28 billion, compared to Rs499.3 million in the same quarter last year, primarily driven by higher interest rates during the period.
Pre-Tax Profit and Tax Payments
EFERT reported a profit before tax (PBT) of Rs14.03 billion, marking an 11% decline from the prior year. The company paid Rs5.5 billion in taxes during 3QCY24, lower than the Rs6.2 billion paid during the same period in 2023.
Engro Fertilizers’ results, though showing a decline in profitability, exceeded market expectations, signaling resilience amid economic challenges.
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