The meeting of the board of directors of Fauji Fertilizer Bin Qasim (FFBL) to announce the corporate results for the period ended 31 December, 2014 is scheduled to be taken place January 29, 2015.

Earning to dip but recovery expected in 4QCY14
Company would post profit after taxation of Rs 3.89 billion (EPS: Rs 4.17) down by 31% YoY as against Rs 5.61 billion (EPS: Rs 6.01) in CY13. This is primarily expected due to lower offtake of urea & DAP, lower DAP prices, higher financing cost and fall in other income. In 4QCY14, company likely to surge in earning by 118% QoQ to Rs 2.11 billion (EPS: Rs 2.27) in 4QCY14 versus Rs 971 million (EPS: Rs 1.04) in 3QCY14. This is mainly attributable to higher volumetric DAP sales as it would rise by 67% to 314k tons in 4QCY14 versus 188k tons in 3QCY13.
Cash dividend of Rs 25% likely to announce
We expect FFBL board to announce Rs 2.5/share in 4QCY14 along with results. Previously company declared an interim dividends of 17.5% (Rs 1.75/share) taking full year payout to Rs 4.25/share for the year ending December 31, 2014.
Lower DAP sales likely drag revenue growth
Revenue of the company likely to drop by 9.5% to Rs 49.28 billion versus Rs 54.45 in CY13 mainly due to lower offtake of DAP & Urea along with decline in DAP prices . DAP sales decreased by 7.5% to 715k tons in CY14 versus 773k tons in CY13 while urea offtake fall by 7.6% to 209k tons versus 226k tons in CY13 mainly due to gas curtailment. On the other hand urea prices increases by 1,790/bag in CY14 against price of Rs 1,718/bag recorded in CY13. However, average DAP price decreased by 5% to Rs 3,518/bag in CY14 against price of Rs 3,695/bag recorded in CY13. Gross profit squeeze by 22% to Rs 11.39 billion against Rs 14.51 billion recorded in CY13 owing to lower volumetric sales and reduction in primary margin which squeezed by 3% to $249/ton versus $256/ton in CY13.

  A letter from Michael Moore


Result Preview – FFBL CY14