Fatima Fertilizer records strong financial performance in first nine months of 2023
Fatima Fertilizer Company Ltd. (FATIMA) reported a consolidated Net Profit After Tax (NPAT) of PKR 7.7 billion for the third quarter of 2023 (3Q2023), marking a 57% year-on-year increase. The company’s performance for the first nine months of 2023 (9M2023) also remained solid, with a NPAT of PKR 12.9 billion, up by 20% compared to the same period last year, according to financial statements released on the Pakistan Stock Exchange on October 26.
This quarterly result is the highest NPAT in the company’s operational history and is primarily driven by elevated nitrogen-phosphorous (NP) prices and higher NP sales volumes, according to a report from IMS Research, a local research firm.
In terms of sales revenue, the company generated PKR 159.46 billion during the 9MCY23 period, as opposed to PKR 99.67 billion during the corresponding period last year. The substantial increase in revenue is mainly attributed to growth in NP volumes. However, this performance comes with the caveat of increased attributable input costs, including inflation, higher fuel costs, currency depreciation, and rising interest rates.
A detailed report by Fatima Fertilizer indicated that combined production volumes for the first nine months of 2023 saw a 15% decrease, settling at 1.789 million metric tonnes of all types of fertilizers. This was due in part to scheduled maintenance and a lack of gas availability at the Sheikhupura plant in Punjab during the first quarter. Despite these constraints, the company experienced a 16% growth in sales volumes, reaching 2.095 million metric tonnes, driven by higher demand for NP products. Additionally, the company managed to maintain its overall market share, primarily through an 8% increase in its share of the phosphate market.
As an integral part of Pakistan’s agricultural sector, Fatima Fertilizer is focused on enhancing the country’s food security and economic stability. Despite a challenging business environment, the company expects steady growth in 2023 due to healthy product volumes and robust operational strategies. With a consistent supply of gas, the company is equipped to operate at full capacity, ensuring timely and affordable fertilizer availability for local farmers. This strategy is anticipated to save the country hundreds of millions of U.S. dollars in foreign exchange by decreasing the reliance on imported fertilizers.