In our today’s morning report we will discuss the upcoming board meeting of Fauji Cement Company Limited for the 1HFY15 which is scheduled on Feb 16, 2015, following are the details.
Earnings growth to continue
FCCL profitability is expected to continue as company to post 17% growth to Rs 1,463 million (EPS: Rs 1.10) against Rs 1,251 million (EPS: Rs 0.94) in 1HFY14 due to higher retention prices, hike in volumetric growth, fall in coal prices, surge in other income and lower financing cost.
43% QoQ earnings growth expected; DPS of Rs 1 likely
In 2QFY15, we expect company to post earning growth of 43% QoQ to Rs 862 million (EPS: Rs 0.65) in 2QFY15 against Rs 602 million (EPS: Rs 0.45) in 1QFY15. This is expected due to higher retention prices and increase in cement dispatches by 14% QoQ in 2QFY15 along with lower financing cost. Furthermore, we expect company to announce cash dividend of Rs 1/share.
Higher cement volume to spur top line growth
Net sales likely to surge by 9% to Rs 9.01 billion in 1HFY15 against Rs 8.23 billion owing to the higher cement price of average around Rs 508/bag in 1HFY15 translated into better retention prices of around Rs 6, 986/ton in 1HFY15. Similarly, volumetric sales likely to up 5% to 1,238k tons versus 1,185k tons in 1HFY14 mainly due to higher local cement sales which rises by 7% to 1,011k tons in 1HFY15 against 948k tons in 1HFY14. Gross profit likely to hike by 8% to Rs 2.98 billion versus Rs 2.77 billion in 1HFY14 due to better retention prices.