By: WE Financial Services Limited
The meeting of the board of directors of Kohat Cement Limited (KOHC) and Attock Petroleum Limited (APL) and to announce corporate results for 1HFY16 would take place on January 28, 2016 and February 9, 2016 respectively. Therefore in our today’s morning we would present forecast on these results.
KOHC: Growth to remain strong; Primarily on back of higher volumetric sales and lower coal prices, the cumulative profit after taxation (PAT) of KOHC is expected to post significant growth of 51% YoY in 1HFY16 to Rs 2,061 million (EPS: Rs 13.34) versus a PAT of Rs 1,366 million (EPS: Rs 8.84) in 1HFY15. With the support of 16% YoY higher sales volume and stable cement prices, the net revenue of the company is likely to hike by 23% YoY in 1HFY16 to Rs 7,293 million versus Rs 5,906 million in 1HFY15. On the other side due to lower coal prices, the cost of sales to remain in control and would surge by 7% YoY in 1HFY16. Therefore gross profit would climb by 55% YoY in 1HFY16 to Rs 3,151 million versus Rs 2,032 million in 1HFY15. The corporate results are likely to be accompanied with a first interim cash dividend of Rs4/share.
APL: Lower crude oil prices would continue to dent earning: Owing to heavy inventory losses due to significant decline in international crude oil prices which have dropped to below $35/barrel, the bottom-line of APL is anticipated to witness a 12% YoY decline in 1HFY16 to Rs 1,286 million (EPS: Rs 15.5) as against a PAT of Rs 1,468 million (EPS: Rs 17.69) in 1HFY15. The company is likely to go through inventory losses of more than Rs 500 million during the period under review while the bottom-line growth would also affected by 14% reduction in volumetric sales and lower other income. The major hit would be from expected 35% YoY decline in net revenue to Rs 65,185 million in 1HFY16 versus Rs 100,153 million in the identical period in FY15. We anticipate the company to announce a first interim cash dividend of Rs 10/share along with the corporate results.