Fauji Cement Company Limited (FCCL) is scheduled to announce its 3QFY19 financial result on Thursday (18th Apr’19) whereby analysts expect the company to post earnings of PKR 719mn (EPS: PKR 0.52), down by 16% YoY and 30% QoQ.
Weaker profitability forecast stems from a decline in topline to PKR 4.5bn, down by 19% YoY given a sharp 26% YoY dip in total dispatches to 684k tons.
While coal prices tapered off from prior year, 20% depreciation in the Pak Rupee and volumetric decline may restrict margins at 26% vis-à-vis 27% in SPLY.
Albeit, distribution costs will relieve some pressure off the bottom-line; at PKR 23mn compared to PKR 72mn in 3QFY18 led by a 30% cut in exports to 27k tons.
The decline appears more evident on a QoQ basis as 11% decline in volumes together with PKR depreciation eroded margins and hence, earnings.
On a cumulative basis, bottom-line during 9MFY19 is expected at PKR 2,543mn (EPS: PKR 1.84), depicting a jump of 20% YoY.
Despite a 6% slowdown in revenue to PKR 14.9bn (13% volumetric decline YoY), margins recuperated to 28% (9MFY18: 24%) amid operationalization of Line-II and higher retention prices in the period under review.