PPL receivables cross Rs 40 billion mark

OUR STAFF REPORTER LAHORE - The PPLs sales have surged by 24 per cent annually to Rs22.65 billion despite the fact that the total account receivables have reached Rs40 billion at the end of 1QFY12. Experts said that the massive account receivable would not hurt liquidity and dividend payout ability of the company in FY12 as the company currently holds Rs27.34 billion cash and short term investments. They said that the sale increased mainly due to higher sales volumes and realized prices. In 1QFY12, sales volumes of the company for oil and gas showed a growth of 8 percent and 2 percent YoY respectively while realized oil and gas prices which are supported by international oil prices rose by substantially 50 percent and 13 percent respectively. The company has shown an enormous growth of 27 percent YoY in the profitability as the company has earned EPS of Rs7.52 in 1QFY12. Growth of 24 percent and 66 percent in sales and other income has remained as the chief earning drivers while 29 percent increase in expenditure expenses has restricted added growth in bottom line. It is expected that the growth momentum to continue in coming quarters on account of expected higher volumes and prices as these are expected to flourish the EPS by a substantial 30 percent YoY and 5 percent dividend yield in FY12. During 1QFY12 PPL had announced a PAT of PKR9.89 billion translating into an EPS of 7.52 up by 27 percent YoY (39 percent QoQ) mainly due to enhanced oil and gas sales volumes, impact of higher international oil price and depreciation of Pak Rupee against US Dollar. The other factor that helped the rise in earnings was other income which grew by enormously 66 percent YoY. On the other side, field expenditure witnessed a gigantic increase of 29 percent YoY on the back of higher exploration and deprecation expenses. We have increased our FY12 EPS estimates to Rs31.10 for PPL in FY12, growth of 30 percent YoY mainly due to 1) higher expected volumes, 2) higher expected realized oil and gas prices as 4 percent price hike in gas is expected for 2QFY12 on account of higher international market price and 3) Pak Rupee deprecation against the rupee. In addition to this, we also expect 40 percent payout ratio for FY12, implying a dividend yield of 5 percent based on current market price. Based on the current market price, expected earnings and dividend, PPL is trading at a FY12 and FY13 prospective PE of 5.6x and 4.9x respectively and prospective dividend yield of 5 percent and 6 percent. Tomato, onion rates high despite abundant supply

ePaper - Nawaiwaqt