Morning Call about PTC and ACPL for 1QFY12 – Arif Habib Limited

Karachi: PTC; Profitability may drop by 30% YoY in 1QFY12

According to Arif Habib Limited, Pakistan Telecommunication Company Limited (PTC) is scheduled to announce its 1QFY12 results on October 18, 2012. On standalone basis, Arif Habib expects the company to post an earnings of PKR 1,449mn (EPS: PKR 0.28) in 1QFY12 as compared to PKR 2,081mn (EPS: PKR 0.41) in same period last year, depicting a decline of 30% YoY. This is primarily due to depleting fixed line revenues and rising salaries expense. Moreover due to competitive environment, company’s operating expenses jumped up by 17% YoY to PKR 2,685mn in 1QFY12 as against PKR 2,297 mn in 1QFY11. In 1QFY12 other Income is expected to increase by 1% YoY to PKR 1.9bn on the back of higher interest earned on loan to Pak Telecom Mobile Limited (Ufone) and through better cash management.


Financial Highlights (PKRmn) 1QFY12F 1QFY11A  % Chg.
Revenue 14,514 13,856 5%
Cost of Services 11,466  10,185 13%
Gross Profit 3,048 3,671  -17%
Operating Expenses 2,685 2,296 17%
Other Income  1,904 1,894 1%
Operating Profit  2,267 3,268 -31%
Finance Cost  39 70  -44%
Profit Before Tax  2,228  3,199  -30%
Taxation 780 1,117 -30%
Profit After Tax 1,449 2,082 -30%
EPS (PKR) 0.28   0.41  -30%
Source: Company Financials & AHL Research


ACPL; Higher retention price may shape a 38% earnings growth in 1QFY12

The Board of Directors of Attock Cement Pakistan Limited (ACPL) is scheduled to meet on October 20, 2011 to approve the financial results for 1QFY12. Arif Habib expects the company to bag a 41% YoY earnings growth with profit after tax of PKR 258mn (EPS: PKR 2.97) in 1QFY12, compared to PKR 182mn (EPS: PKR 2.1) in the same quarter last year. This exuberant growth in profitability is likely to stem from a 26% YoY Increase in the average retention price, which despite an expected decline in the volumes is estimated to yield top line growth for the company. Gross margin is likely to improve to 27% during 1QFY12 compared to 14% in 1QFY11 on account of rising retention price. The Company is likely to yield the benefits of Waste Heat Recovery Plant (WHRP) from 2QFY12, which will significantly reduce its rising electricity cost (annualized savings of PKR 3.3/share).


ACPL Financial Highlights
PKR mn 1QFY12 1QFY11  YoY
Net Sales 2,192 1,755 25%
Gross profit 586 253 132%
Admin expenses  53  44 20%
Selling expenses 128 99  30%
Operating Profit 404 143 182%
Financial charges 8  4 119%
Profit before tax  396  139 184%
Profit after tax  258 182   41%
Earnings per share (PKR) 2.97  2.10  
Sources: Company accounts and AHL Research

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