The latest financial result announced by Fauji Cement Limited confirms the strong performance that most pundits have been predicting on the back of a conducive market environment. The company’s bottom-line has improved by a massive 66 percent in 1HFY16 when compared to the same period of the previous fiscal.
The impressive performance is evident from top to bottom as the company is among few remaining local cement manufacturers to report an increase in exports in its latest quarter. AHL analyst Tahir Abbas highlights that exports climbed 26 percent QoQ, while domestic dispatches rose by 24 percent in the same period.
Despite higher top line, the company’s cost of goods sold was lower in 1HFY16 as compared to the previous year, thanks to a decline in the applicable power tariff. This has helped to beef up its gross profits by a hefty 44 percent year-on-year.
Strong demand in the north has continued to support the company’s performance in recent years despite fears of price war on the back of expansion by other players in this region.
However, so far FCL has remained unscathed by competitors. Market participants were further rewarded with the announcement of a dividend of Rs1.75 per share.
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Fauji Cement
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Rs (In millions) 2QFY16 chg 1HFY16 chg
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Sales 5569 16% 9950 11%
Cost of sales 2871 -4% 5373 -8%
Gross profit 2699 47% 4577 44%
Gross margin 48% 46%
Administrative expenses 80 28% 150 15%
Selling & distribution
expenses 58 42% 94 24%
Other operating expenses 172 47% 285 56%
Other income 65 44% 133 48%
Finance cost 122 69% 320 -21%
PAT 1674 57% 2777 66%
Net margin 30% 28%
EPS (Rs) 1.21 2.01
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Source: PSX notice
