Half Yearly Financial Statements 2023
HALF YEARLY
FINANCIAL
STATEMENTS
JUNE 30, 2023 (Un - Audited)
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CONTENTS
03Company Information
04 Directors' Review
07
08Independent Auditor's
Review Report
09Condensed Interim
Financial Statements
27Condensed Interim Consolidated Financial Statements
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Half Yearly Financial Statements 2023
SAY NO TO CORRUPTION
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Company Information
BOARD OF DIRECTORS
Mr. Waqar Ahmed Malik
Chairman
Mr. Sarfaraz Ahmed Rehman
Managing Director & Chief Executive Officer
Dr. Nadeem Inayat
Mr. Saad Amanullah Khan
Ms. Maryam Aziz
Maj Gen Naseer Ali Khan, HI(M) (Retd)
Mr. Peter Bruun Jensen
Maj Gen Ahmad Mahmood Hayat, HI(M) (Retd)
Syed Bakhtiyar Kazmi
Mr. Shoaib Javed Hussain
Mr. Jehangir Shah
Dr. Ayesha Khan
Mr. Momin Agha
CHIEF FINANCIAL OFFICER
Syed Atif Ali
Tel No. +92-51-8456101, Fax No. +92-51-8459961
E-mail: atif_ali@ffc.com.pk
COMPANY SECRETARY
Brig Irfan Khan TBt (Retd)
Tel No. +92-51-8453101, Fax No. +92-51-8459931
E-mail: secretary@ffc.com.pk
REGISTERED OFFICE
156 The Mall, Rawalpindi Cantt, Pakistan Website: www.ffc.com.pk
Tel No. +92-51-111-332-111,+92-51-8450001
Fax No. +92-51-8459925,E-mail: ffcrwp@ffc.com.pk
PLANTSITES
Goth Machhi, Sadiqabad
(Distt: Rahim Yar Khan), Pakistan
Tel No. +92-68-5954550-64, Fax No. +92-68-5954510-11
Mirpur Mathelo
(Distt: Ghotki), Pakistan
Tel No. +92-723-661500-09, Fax No. +92-723-661462
MARKETING DIVISION
Lahore Trade Centre, 11 Shahrah-e-Aiwan-e-Tijarat,
Lahore, Pakistan
Tel No. +92-42-36369137-40, Fax No. +92-42-36366324
KARACHI OFFICE
B-35, KDA Scheme No. 1, Karachi, Pakistan
Tel No. +92-21-34390115-16, Fax No. +92-21-34390117 & 34390122
AUDITORS
A.F.Ferguson & Co
Chartered Accountants
74-East, Blue Area, Jinnah Avenue, Islamabad
Tel No. +92-51-2273457-9,2870045-85, Fax No. +92-51-2206473
SHARES REGISTRAR
CDC Share Registrar Services Limited
CDC House, 99 - B, Block - B, S.M.C.H.S., Main Shahra-e-Faisal, Karachi - 74400 Tel: +92-0800-23275, Fax: +92-21-34326053
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Half Yearly Financial Statements 2023
DIRECTORS' REVIEW
Dear Shareholders,
By the Grace of Allah SWT, the Board of Directors is pleased to report that the Company has achieved highest ever half yearly profit of Rs 13.08 billion for the period ended June 30, 2023, compared to Rs 9.60 billion last year.
The increased profitability is attributable to significant cost optimization measures and operational efficiency enhancement initiatives implemented by the management, along with record investment income of Rs 6.3 billion attributable to efficient treasury operations of the Company.
The Company achieved the above results despite high level of inflation, devaluation of currency and imposition of additional super tax. Earning per share stood at Rs
10.28 compared with Rs 7.55 last year. The profitability in dollar terms however declined by 8% to USD 48 million compared to USD 52 million last year.
Sona urea production by the Company stood at 1,278 thousand tonnes, which was in line with last year, with an operating efficiency of 125%. The operating costs at Rs 46.5 billion witnessed an increase of 22%, whereas finance cost was registered at Rs 2.7 billion, with an increase of Rs 640 million. The retrospective application of 6% of super tax also negatively impacted Company's profitability by Rs 3.9 billion, which resulted in an effective tax charge of 49% being one of the highest.
It is pertinent to mention that selling prices of urea varied significantly within the fertilizer industry, with FFC marketing urea at the lowest price of Rs 2,565 per bag, compared to market prices of around Rs 3,000 per bag and international price of Rs 5,700 per bag.
In line with our commitment to provide continuous returns to our shareholders, the Board is pleased to announce second interim dividend of Rs 3.15 per share, with an aggregate distribution of Rs 7.41 per share during the first half of 2023.
Future Outlook
The Honourable Islamabad High Court has declared retrospective imposition of super tax from year 2021 as unconstitutional, in its judgement dated 20 July 2023. The tax department however has the option to file a petition before Supreme Court against this judgement. In addition, pursuant to the directions of Supreme Court, 50% of super tax liability for year 2021 had already been deposited by the Company in April 2023.
The Finance Act 2023 also imposed federal excise duty on fertilizers, besides levying 5% GST on DAP. The impact of these levies had been passed on to sustain the shareholders returns.
Gas prices are expected to increase under the proposition of price unification, which would lead to phenomenal increase in Company's gas cost, while the cost of other fertilizer manufacturers is not expected to be impacted materially. The Company is further being compelled not to pass on the impact of gas price escalation which would severely impact Company's profitability.
The Government is therefore requested for cognizance of FFC's endeavours for providing urea to the farmers at the lowest rates in the Country, and also devise a formula for gas price increase which would allow level playing field to all the fertilizer manufacturers. The Government is further requested to implement gas
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Fauji Fertilizer Company Limited published this content on 24 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 August 2023 07:00:00 UTC.