⚡ Flash Summary
Fatima Fertilizer Company Limited’s report for the nine months ended September 30, 2025, reveals a mixed performance. While the company increased its fertilizer offtake by 8.6% despite a market decline, its gross profit receded slightly due to increased gas costs and inflationary pressures. Consolidated sales revenue increased by 5% to Rs 178.80 billion. However, the company achieved a 27% increase in consolidated profit after tax due to a reduction in the effective tax rate.
📌 Key Takeaways
- ⬆️ Fertilizer offtake increased by 8.6% despite a market decline.
- 📉 Gross profit receded slightly due to increased gas costs and inflationary pressures.
- 💰 Consolidated sales revenue increased by 5% to Rs 178.80 billion.
- ✅ Consolidated profit after tax increased by 27% due to a reduction in the effective tax rate from 45% to 37%.
- 🏭 Combined fertilizer production achieved was 2,131K MT compared to 2,141K MT in the prior year.
- 🌍 Sales volume for the nine months stood at 1,828K MT, compared to 1,684K MT in the prior year.
- 📊 Distribution costs increased by 27% due to high storage and network expansion costs.
- 📈 Other income almost doubled due to higher return on investments.
- 🏢 Consolidated Profit before Tax of Rs 46.07 billion, a 12% increase over Rs 41.23 billion.
- 💸 Earnings per share (EPS) increased to Rs 13.77 compared to Rs 10.84.
- 🌱 The company managed to increase its offtake by gaining 4.5% market share.
- 🤝 Scheme of Arrangement/Reconstruction for carving out of Multan Plant related operations is in progress.
🎯 Investment Thesis
HOLD: Given the mixed financial performance with increased revenue offset by rising costs, and pending scheme of arrangement, a HOLD recommendation is appropriate. The company faces operational and market risks that could impact future performance.
Disclaimer: AI-generated analysis. Not financial advice.