HUBCO's Profits Surge by 93% in 1QFY24: A Boost to Pakistan's Economy
A substantial increase in the cost of finance was reported, alongside substantial gains from associates and ventures. HUBCO, with a 3,581 MW installed power generation capacity, plays a vital role in various sectors, making it a significant player in Pakistan's economy.
Karobar
HUBCO, Pakistan's leading Independent Power Producer (IPP), has reported a remarkable 93% increase in profits, soaring to Rs18.32 billion in the first quarter of fiscal year 2023-24, which concluded on September 30.
This substantial growth in profitability, a significant leap from the Rs9.47 billion recorded in the same period the previous year, has been attributed to several key factors. Notably, HUBCO expanded its portfolio with the inclusion of TEL, ThalNova, and Prime International. Additionally, the 28% year-on-year depreciation of the Pakistani rupee against the US dollar has further bolstered the company's financial performance. Arif Habib Limited (AHL) emphasized these contributing factors in their report.
In terms of earnings per share (EPS), the company marked an impressive increase to Rs13.17 for the quarter under review, compared to Rs7.01 in the same period the previous year (SPLY).
HUBCO has announced an interim cash dividend of Rs5 per share, equivalent to 50% for the first quarter.
On a consolidated basis, the IPP's turnover surged by nearly 14% to Rs33.73 billion in 1QFY24, compared to the Rs29.59 billion recorded in the prior year.
Operating costs also experienced a notable decline, decreasing by over 14% to Rs16.99 billion in 1QFY24, compared to the Rs19.87 billion in SPLY.
As a result, the gross profit of HUBCO saw a significant increase, rising by over 72% to Rs16.74 billion in 1QFY24.
It's important to note that the company's other income showed a decline of 32% year-on-year, totaling Rs280.85 million in 1QFY24, in contrast to the Rs412.28 million in SPLY.
On the other hand, the company's cost of finance saw a substantial increase, reaching Rs7.07 billion in 1QFY24, representing a growth of over 203%. This increase is linked to a significant rise in interest rates during the year.
Despite this, HUBCO achieved a substantial Rs12.03 billion as its share of profits from associates and ventures in FY23, marking an impressive increase of over 289% year-on-year.
HUBCO boasts a combined installed power generation capacity of 3,581 MW. The IPP, along with its subsidiaries, is engaged in various business sectors, including oil and gas, mining, and industrial operations and maintenance services.
In an impressive financial report, HUBCO, Pakistan's largest Independent Power Producer (IPP), witnessed a remarkable 93% surge in profits during the first quarter of fiscal year 2023-24, attributed to portfolio expansion and a depreciating rupee. Earnings per share also experienced a significant boost. The IPP's consolidated turnover and gross profit rose, while other income declined.
