Agritech Limited reveals uneven financial performance in 2023

Agritech Limited (AGL), a Pakistan-based producer of urea and phosphate fertilizers, disclosed inconsistent financial outcomes for the fiscal year 2023, according to the information available on the Pakistan Stock Exchange’s website. The company operates urea plants in Mianwali City, Punjab Province, and a Single Super Phosphate facility in Haripur Hazara, KPK of Pakistan. According to published financial results, there was a loss for the nine months ending in September 2023, while the company still received profit in the third quarter of this year.

AKD Research, a local research institution, noted that the company’s third quarter displayed earnings of PKR 0.27 per share, following previous periods of loss. This suggests a cautiously optimistic outlook for Agritech, contingent on continued gas provision by the government. The research house also pointed out that given the ongoing reports of a urea shortage in Pakistan, the company is expected to maintain operations, particularly as the Rabi agricultural season approaches.

In terms of financial specifics, AGL reported a loss of PKR 2.76 billion for the period from January to September 2023. This compares to a loss of PKR 2.42 billion for the same nine-month stretch in 2022. Conversely, the company realized a profit of PKR 104 million in the third quarter of 2023, marking a significant turn from a loss of PKR 613 million during the equivalent period last year.

Attributing the nine-month losses to elevated costs, the company noted that high sales and financing costs were significant contributing factors. AGL’s net sales for the nine months increased to PKR 13.90 billion, up from PKR 12.01 billion in the previous year. Cost of sales likewise rose to PKR 11.52 billion, compared to PKR 10.67 billion during the corresponding period.

Additional financial details revealed a spike in administrative expenses to PKR 412 million, up from PKR 359 million, and a rise in financing costs to PKR 4.5 billion for the nine months in question.

In a meeting on October 20, 2023, Agritech’s Board of Directors made no announcement regarding dividends.