Engro Corporation profit rises 47.4% to Rs14.33 billion

KARACHI: Engro Corporation posted a net profit of Rs14.33 billion (EPS: Rs15.13) for the quarter ended June 30, 2021, which is 47.4 per cent higher than the profit of Rs9.78 billion (EPS: Rs9.96) in the corresponding period last year. Earnings came below the market expectations, a bourse filing said on Tuesday.

The revenues during the quarter surged 10 per cent to Rs68.45 billion, compared with Rs62.19 billion in the same period of the last year.

Engro Corporation has declared a cash dividend of Rs7/share for the period under review, which is in addition to the interim dividend of Rs12/share already paid to the shareholders.

The finance cost declined 16.18 per cent to Rs4.35 billion due to lower interest rates, while other income declined 8.7 per cent to Rs3.24 billion during the quarter under review.

Among the subsidiaries, Engro Fertilizers Limited earnings (largest contributor to Engro’s earnings) were up 23 per cent to Rs4.7 billion during the second quarter of 2021. “This is mainly due to the improvement in gross margins by 3.3 percentage points, absence of provision on account of sales made to unregistered dealers recorded in the second quarter of 2020 and 36 per cent decline in finance cost, amid lower borrowing,” an analyst at Topline Securities said.

“Engro Polymer Company Limited (EPCL) earnings also went up due to an increase in PVC sales, amid supply side disruption.”

Further, in continuation of its drive to further institutionalise the systems and processes at the company, the board appointed Shahzada Dawood as vice chairman of the board of the company with effect from October 21, 2021.

Dawood brings with him 18 years of experience on the board of the company, as well as a strong grasp of global affairs, that will help position the company for the next phase of its growth.

The board appreciated the outstanding contributions made by Abdul Samad Dawood during his tenure as vice chairman and placed on record the tremendous progress that the company had made under his leadership.

Samad Dawood will continue to serve on the board of the company in his capacity as non-executive director.