Karachi: Hubco profits and earnings are surprising for investors and stakeholders as it posted 51 percent growth in its profits 51 in the closing financial year of 2011-12 despite legal battle on tax issues.
The company posted profit-after-tax of Rs8.2 billion in FY12 as against Rs 5.4 billion in FY11.
Along with the result, the company has also announced a final cash dividend of Rs3/share that will take the total dividend to Rs6/share. The improved earnings are primarily attributable to revised Narowal tariff, and rupee depreciation against dollar and uptick in its tariff profile.
Other factors that played their role in earning growth came from U-shaped based return.
The top line of the company grew by 42%YoY primarily due to pass through of higher furnace oil prices and coming online of Narowal project.
Furthermore, the financial charges increased drastically by 109%YoY. This hefty growth in financial charges is owing to financing facility associated with the Narowal project and due to the circular debt issue.
During the current financial year, Hubco has been involved in legal battle against Federal Board of Revenue (FBR) for paying taxes. Its accounts were frozen for quite few weeks after it become defaulter to meet the payment deadline of its due taxes.
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