{"id":9144,"date":"2025-05-07T16:13:47","date_gmt":"2025-05-07T11:13:47","guid":{"rendered":"https:\/\/ksestocks.com\/blog\/?p=9144"},"modified":"2025-05-21T09:40:12","modified_gmt":"2025-05-21T04:40:12","slug":"should-investors-worry-about-fccls-weaker-than-expected-q3","status":"publish","type":"post","link":"https:\/\/ksestocks.com\/blog\/should-investors-worry-about-fccls-weaker-than-expected-q3\/","title":{"rendered":"Should investors worry about FCCL\u2019s weaker-than-expected Q3?"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Key takeaways:<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>EPS rises to Rs. 0.87, <strong>up 21% YoY<\/strong>, but below street estimates<\/li>\n\n\n\n<li><strong>Gross margins improve to 32%<\/strong> on a better power mix and fuel efficiency<\/li>\n\n\n\n<li><strong>No dividend announced<\/strong>, in line with expectations<\/li>\n<\/ul>\n\n\n\n<p>Fauji Cement Company Ltd. (<strong><a href=\"https:\/\/ksestocks.com\/blog\/tag\/fccl\/\" target=\"_blank\" rel=\"noopener\" title=\"FCCL\">FCCL<\/a><\/strong>) announced its financial results for 3QFY25, posting earnings of Rs. 2.14 billion (EPS: Rs. 0.87), marking a <strong>21% year-on-year increase<\/strong>. While the result showed decent growth, it <strong>came in below industry expectations<\/strong>, primarily due to <strong>higher-than-expected finance costs<\/strong> and <strong>lower-than-anticipated gross margins<\/strong>.<\/p>\n\n\n\n<p>The company did not announce any dividend for the quarter, which was largely in line with investor expectations.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Gross margins improve, but QoQ pressure is evident<\/h2>\n\n\n\n<p>FCCL reported <strong>gross margins of 32%<\/strong> in 3QFY25, up from 28% in the same period last year. The YoY margin expansion was driven by <strong>higher domestic dispatches<\/strong>, a <strong>greater share of renewable energy in the power mix<\/strong>, and <strong>lower fuel costs<\/strong>. However, margins were <strong>down from 36% in 2QFY25<\/strong>, reflecting some cost pressures and price softness.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Revenue shows modest growth on yearly basis<\/h2>\n\n\n\n<p>Net sales increased <strong>just 1% YoY<\/strong> to Rs. 19.3 billion, as the impact of higher dispatches was largely offset by <strong>lower retention prices<\/strong>. On a <strong>quarter-on-quarter basis<\/strong>, revenue was down <strong>22%<\/strong>, due to a decline in domestic sales volumes.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Domestic dispatches<\/strong>: 1.15mn tons (\u21914% YoY, \u219313% QoQ)<\/li>\n\n\n\n<li><strong>Export dispatches<\/strong>: 0.04mn tons (\u219353% YoY, \u219376% QoQ)<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Operating profits and costs<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Operating profit<\/strong> stood at Rs. 4.95 billion, up <strong>16% YoY<\/strong> but down <strong>34% QoQ<\/strong><\/li>\n\n\n\n<li><strong>Distribution expenses<\/strong> dropped 8% YoY<\/li>\n\n\n\n<li><strong>Finance costs<\/strong> declined <strong>11% YoY<\/strong> to Rs. 1.46 billion, thanks to reduced borrowing and lower interest rates<\/li>\n\n\n\n<li><strong>Other income<\/strong> dropped 29% YoY, contributing to the earnings miss<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Higher taxation impacting net profit<\/h2>\n\n\n\n<p>Taxation increased to <strong>Rs. 1.35 billion<\/strong> (effective tax rate: 39%), up from 33% in the same quarter last year, further pressuring bottom-line growth.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Valuation snapshot<\/h2>\n\n\n\n<p>FCCL is trading at a forward P\/E of <strong>6.1x for FY26<\/strong> and <strong>5.3x for FY27<\/strong>, which may offer value if margins stabilize and volume growth continues.<\/p>\n\n\n\n<p><strong>Source: Topline Securities (Private) Limited<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Fauji Cement Company Ltd. (FCCL) announced its financial results for 3QFY25, posting earnings of Rs. 2.14 billion (EPS: Rs. 0.87), marking a 21% year-on-year increase. While the result showed decent growth, it came in below industry expectations, primarily due to higher-than-expected finance costs and lower-than-anticipated gross margins.<\/p>\n","protected":false},"author":9252,"featured_media":6678,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[154,138],"tags":[41],"class_list":["post-9144","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","category-financials","tag-fccl"],"featured_image_src":{"landsacpe":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/FCCL-STOCK-PSX-1140x445.png",1140,445,true],"list":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/FCCL-STOCK-PSX-463x348.png",463,348,true],"medium":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/FCCL-STOCK-PSX-300x188.png",300,188,true],"full":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/FCCL-STOCK-PSX.png",1920,1200,false]},"_links":{"self":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9144","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/users\/9252"}],"replies":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/comments?post=9144"}],"version-history":[{"count":2,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9144\/revisions"}],"predecessor-version":[{"id":9316,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9144\/revisions\/9316"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media\/6678"}],"wp:attachment":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media?parent=9144"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/categories?post=9144"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/tags?post=9144"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}