EFERT 2QCY25 Earnings Surge

Staff Report

ISLAMABAD: Engro Fertilizer Limited (EFERT) announced its 2QCY25 financial results, reporting consolidated net earnings of Rs5.6 billion (EPS: Rs4.17), up 3.5x YoY compared to Rs1.7 billion (EPS: Rs1.20) in the same period last year. The result was broadly in line with market expectations.

Alongside the result, the company declared an interim cash dividend of Rs4.25/share, taking the cumulative payout for 1HCY25 to Rs6.50/share.Pakistan Fertilizer: Profits likely to be down 14% in 3Q2022

Net revenue for 2QCY25 stood at Rs50.4 billion, reflecting a 28% YoY increase driven by higher Urea sales, which surged 40% YoY. Gross margins improved to 31% versus 20% in the corresponding period last year, primarily supported by higher sales volumes.

Operating costs rose 21% YoY to Rs6.3 billion, in line with increased Urea sales, while finance costs climbed 44% YoY due to elevated borrowings during the quarter.

On a sequential basis, EFERT’s earnings jumped 89% QoQ, supported by strong growth in Urea sales (up 66% QoQ) and DAP sales (up 131% QoQ) as the company regained market share in Urea.

For 1HCY25, cumulative net earnings declined 10% YoY on account of weaker Urea sales (down 19% YoY), lower DAP sales (down 36% YoY) and a 106% YoY increase in finance costs.

As per the latest accounts, EFERT’s net debt stood at Rs52 billion versus Rs45 billion previously. The increase was primarily attributed to higher inventory levels, with Urea inventory at 0.53 million tons.