[PSX] KAPCO’s profit soars 65% to Rs6.05b in 1Q 2020

KARACHI: The Profit of the Kot Addu Power Company (KAPCO) soared by 65 percent to Rs6.05 billion in the quarter ended March 31, 2020, on the back of a substantial rise in other revenues.

According to a notice sent on Wednesday to the Pakistan Stock Exchange, the power-producing business had reported an income of Rs3.67 billion in the same quarter last year.

The company’s earnings per share (EPS) came in at Rs6.87 in January-Mar 2020 compared to Rs4.17 in the corresponding preceding year period. The firm also declared to its shareholders a cash dividend of Rs1.5 per share.

Over the three months under review, net sales rose 11 percent to Rs11.93 billion, compared to Rs10.76 billion in the same period last year.

According to a report by Arif Habib Limited, the increase in sales came due to higher prices of re-gasified liquefied natural gas (RLNG), but dispatches remained low due to the country’s overall thin market.

Gross profit rose 50 percent to Rs5.57 billion during the period of January-Mar 2020. In the same quarter last year, the company had posted a gross profit of Rs3.7 billion. Other revenues rose from Rs3.97 billion last year in Jan-Mar to Rs5.32 billion in the same quarter of the current year.

“Other revenues increased due to tariff true-up along with higher interest rates compared to last year’s same period,” Arif Habib Limited said. ‘Overdue receivables dropped by 5 percent year-on-year to Rs101 billion (as of December 2019).’ Operating profit increased from Rs7.46 billion in the quarter of January last year to Rs10.7 billion in the quarter ended March 31, 2020.

On the other hand, the company’s finance costs rose to Rs2.18 billion compared with last year’s Rs2.13 billion. Finance costs rose year-on-year by 3 percent due to higher interest rates, the report by Arif Habib mentions.

“We’re revising our earnings estimates to Rs24.94 per share for FY20 because of surprise earnings for 3QFY20,” it said.

Nine-month performance Nine months ended March 31, 2020, Kapco’s income rose 78 percent to Rs17.77 billion compared to Rs9.99 billion in the corresponding period of the preceding fiscal year.

Earnings per share for Jul-Mar FY20 came in at Rs20.19 as against Rs11.35 in the same period last year.