Engro Fertilizer demonstrates significant profit growth in the first-half of 2024

Engro Fertilizer Ltd. reported a significant increase in profits for the first half of the 2024 fiscal year 2024, covering the period from January to June. Pakistan’s major fertilizer producer announced a consolidated net profit of PKR 9.426 billion ($33.85 million), marking a 73% increase year-on-year compared to PKR 5.464 billion ($19.62 million) in the corresponding period last year. This growth is attributed primarily to increased prices and sales volumes of urea and Di-Ammonium Phosphate (DAP).

Despite a challenging period for the domestic agriculture sector, highlighted by a wheat crisis that suppressed farmer incomes, the total demand for urea in Pakistan remained nearly flat at 3.035 million tonnes, marginally down from 3.098 million tonnes the previous year. In contrast, the company’s consolidated revenue rose to PKR 113.2 billion ($406.7 million) from PKR 82.4 billion ($296 million) in 1H 2023, underscoring its ability to navigate market challenges effectively.

Internationally, urea prices saw an uptick, rising to $319 per ton from $260 per ton year-on-year. However, DAP prices initially dipped due to an increase in exports from China but are anticipated to recover in the coming months, driven by reduced supply from China and heightened demand from India.

On the operational front, Engro Fertilizer’s strategic maneuvers, including significant investments, were crucial to its performance. Although urea production decreased to 966,000 metric tonnes from 1.115 million metric tonnes in 1H 2023 due to plant maintenance, sales of phosphates (DAP, Zorawar & NP) increased substantially, totaling 165,000 metric tonnes compared to 109,000 metric tonnes in the previous year. Additionally, the company recently completed a major $50 million turnaround of the EnVen Plant in Sindh Province, marking a significant investment in its operational capabilities.

Engro Fertilizers Limited, a subsidiary of Engro Corporation Limited and Dawood Hercules Corporation Limited, continues to play a pivotal role in the agriculture sector by manufacturing, purchasing, and marketing fertilizers, seeds, and pesticides, in addition to offering logistic services.