LAHORE - Fauji Fertilizer Company (FFC) has announced its financial results for CY08. FFC declared a Profit After Tax (PAT) of Rs6.53 billion translating into an EPS of Rs13.22 in CY08 as compared to our forecasted PAT of Rs6.88 billion [EPS PRs13.96], depicting a variation of 5.56%. FFC showed decent profitability growth of 21.71% in CY08 as compared to PAT of Rs5.36 billion in the last year. Sales revenue of the company grew by 7.61% to RPs30.59 billion in CY08 as against PRs28.43 billion in CY07. Analyst Syed Muhammad Kamran from Atlas Capital stated that cost of sales remained almost the same as the last year with a meager decline of 0.42% leaving a growth of 22.14% in gross profit from the last year, which translated into an increase of 4.81 percentage points in the gross margin from 35.58% in CY07 to 40.39% currently. The company announced final cash dividend of PRs3.25 per share in addition to previous interim dividends totalling PRs10.75. It also announced a bonus share issue of 25.00%. We reiterate our BUY stance on the scrip with fair value of PRs121 (shares outstanding are not bonus-adjusted). The interesting thing to note is that the company has also decided to double its authorized share capital from PRs5.00b to Rs10.00b.