Karachi, October 29 2024: FATIMA Fertilizer Company has released its financial results for the third quarter of CY24, showcasing a robust performance with a consolidated profit after tax (PAT) of PKR9.2 billion, translating to an earnings per share (EPS) of PKR4.38. This represents an impressive increase of 18% year-on-year and a staggering 77% quarter-on-quarter, highlighting the company’s resilience in a challenging market environment.
Despite the positive earnings report, FATIMA’s revenue for the quarter fell to PKR62.6 billion, down 18% compared to PKR76.2 billion in the same quarter last year. The decline in revenue can be primarily attributed to lower offtakes. However, on a quarter-on-quarter basis, revenue saw a significant recovery, rising by 48% as higher offtakes contributed to improved sales performance.
The company’s gross margins demonstrated strength, increasing by approximately four percentage points year-on-year to reach around 34%. This uptick can be linked to higher product prices, and notably, the gas price for the Sadiqabad plant remained unchanged, providing a stable cost base for production.
FATIMA’s operational efficiencies are evident in its selling and distribution expenses, which decreased by 7% to PKR3.5 billion, reflecting the impact of lower offtakes. Conversely, administrative expenses rose sharply, increasing by 30% year-on-year to PKR2.5 billion. This surge is likely attributable to inflationary pressures affecting operational costs.
Another bright spot in FATIMA’s financials was the significant rise in other income, which jumped 43% year-on-year to PKR2.1 billion. This increase can be linked to enhanced cash and short-term investments, providing a buffer against revenue fluctuations.
Financial charges also improved, decreasing by 9% year-on-year, largely due to declining interest rates, further contributing to the company’s bottom line. The effective tax rate for the quarter stood at 37.6%, a notable drop from 49.2% in the preceding quarter, suggesting improved tax efficiency.
Overall, FATIMA’s 3QCY24 results reflect a company navigating through market challenges while maintaining profitability and operational resilience. The strong PAT growth and improved gross margins signal a positive outlook as the company continues to adapt to changing market dynamics. Investors and analysts alike will be keen to see how FATIMA leverages this momentum in the upcoming quarters, particularly as it seeks to optimize production and enhance shareholder value.
