In our today’s morning report we would discuss the performance of the Power sector during the 1HFY15.
Earnings momentum continues
With continuation of gigantic growth of earning in power sector companies during 1QFY15, 2QFY15 too remain impressive for the sector as cumulative earnings of four companies i.e. (HUBC, KAPCO, NCPL, NPL) in our sample size hike by 91% to Rs 7.10 billion as against Rs 3.72 billion. The primary reason that resulted in higher earrings remains lower maintenance cost, efficiency gains, higher production bonus on account of better load factor and rise in other income.
Top line modestly up
Despite lower furnace oil prices, net sales of the sector remained marginally higher during the period mainly due to hike in load factor as revenue stood at Rs 163.61 billion against Rs 162.27 billion in 1HFY14 depicting increase by 1%. However, operating cost decrease by 3.5% due to lower fuel cost at Rs 142.91 billion compared to Rs 148.06 billon in 1HFY14. Gross profit hike by 46% to Rs 20.70 billion in 1HFY15 versus Rs 14.20 billion in 1HFY14.