Hubco profits decline 42 per cent during 2QFY22

Hubco profits decline 42 per cent during 2QFY22

Hubco profits decline 42 per cent during 2QFY22
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KARACHI: The profit of Hub Power Company Limited (Hubco) declined 42 per cent on a year-on-year basis to Rs4.796 billion, translating into the earnings per share of Rs3.70 during the second quarter of fiscal year 2022.

The company posted a profit of Rs8.198 billion, translating into the earnings per share (EPS) of Rs6.32 during the second quarter of fiscal year 2021.

During the first half of fiscal year 2022, Hubco’s profit declined 25 per cent on a year-on-year basis to Rs12.212 billion translating into the EPS of Rs9.41, compared with Rs16.342 billion translating into the EPS of Rs12.60 during the same period of FY 21.

The decline in earnings is majorly attributable to 89 per cent year-on-year decline in the share of profit from associates and joint ventures.

During the second quarter of FY22, the net sales witnessed an increase of 81 per cent on a year-on-year basis to Rs19.9 billion due to a 207 per cent year-on-year increase in the dispatches to 498GWh and higher furnace oil prices.

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Hub base plant load factor remained 9 per cent at 238GWh, Narowal dispatched 152 GWh to the national grid converting the load factor to 32 per cent while Laraib’s load factor remained 58 per cent at 108GWh.

The sales of the company also increased 73 per cent on a year-on-year basis to Rs46.3 billion during the first half of FY22, primarily due to higher dispatches and higher furnace oil prices.

During the second quarter of FY22, the gross margins of Hubco declined 30pps on a year-on-year basis to 40 per cent mainly attributable to higher load factor during the quarter.

The company recognised a share of loss from associate and joint venture of Rs1.462 billion during the second quarter of FY22, compared with the profit of Rs4.123 billion during the same period of FY21.

The reason for this loss could be subsequent booking of impairment loss on CPHGC’s equipment that was damaged during the first quarter, resulting in business loss.

Moreover, during the first half of FY22, the share of profit from associates declined 89 per cent to Rs831 million, while the finance costs declined 5 per cent on a year-on-year basis to Rs1.738 billion during the second quarter of FY22 due to lower levels of short-term borrowings.

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