Engro Fertilisers’ profit soared 906% to Rs5.74 billion in the quarter ended March 31, 2021 owing to a rise in fertiliser consumption and increase in its prices.

According to a notice sent to the Pakistan Stock Exchange (PSX) on Monday, the company had reported a profit of Rs570.76 million during the same quarter of last year.

Accordingly, the earnings per share of the company came in at Rs4.3 during the January-March 2021 quarter against Rs0.43 in the same period of previous year.

Along with the result, the company announced an interim cash dividend of Rs4 per share. Net sales of the company rose from Rs10.8 billion during January-March 2020 to Rs29.4 billion during January-March 2021, a rise of 172.8%.

“Net sales in 1QCY21 ascended by 173% year-on-year amid a huge growth in urea and di-ammonium phosphate (DAP) offtake by 3.5 times and 1.8 times year-on-year respectively and surge in DAP prices by 27%,” stated a report of Arif Habib Limited. “On the other hand, urea prices declined 2% year-on-year.”

It added that gross margins stood at 39.25% in 1QCY21 compared to 33.68% in 1QCY20, given a significant jump in urea offtake.

Selling and distribution expenses of the fertiliser producer climbed 73% as they rose from Rs1.1 billion during January-March 2020 to Rs1.8 billion in the first three months of 2021.

Similarly, administration expenses rose to Rs411.5 million in the January-March quarter of current year from Rs358.3 million in the same quarter of last year, a growth of 14.8%.

Other income of the firm soared over 80% to Rs479.1 million during the quarter under review. The company had reported other income of Rs261.2 million in the same quarter of previous year.

“Other income surged owing to higher income from financial assets,” the report said.

Finance cost plunged from Rs1.2 billion during January-March 2020 to Rs269.1 million in January-March 2021, a contraction of 77.8%.

Published in The Express Tribune, April 20th, 2021.

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