Fauji Cement Posts 231% YoY Earnings Increase Amid Higher Dispatches

Karachi: Fauji Cement Company Limited (FCCL) reported a significant increase in earnings for the fourth quarter of fiscal year 2025, with earnings per share (EPS) rising to Rs1.6, marking a 69% quarter-on-quarter growth. The company’s total earnings for the fourth quarter reached Rs3.92 billion, representing a 231% year-on-year surge.

Despite the impressive earnings, FCCL’s announcement of a final cash dividend of Rs1.25 per share fell short of industry expectations. The company’s net revenue for the quarter climbed to Rs21.8 billion, reflecting a 6% increase year-on-year and a 13% rise quarter-on-quarter. This growth was attributed to higher local and export dispatches coupled with increased retention prices domestically.

FCCL reported a 6% year-on-year and 2% quarter-on-quarter rise in domestic dispatches, amounting to 1.18 million tons. Export dispatches saw an 8% year-on-year increase and a substantial quarter-on-quarter growth of 427%, reaching 0.20 million tons.

The company’s gross margins improved to 39% in the fourth quarter from 32% in the previous quarter and 36% in the same quarter last year. The enhanced margins were linked to higher domestic retention prices and an efficient coal and fuel mix. A notable increase in reliance on captive power generation, rising to approximately 55% in FY25 from 48% in FY24, contributed to the improved margins.

Finance costs for FCCL decreased by 28% year-on-year to Rs1.09 billion, driven by monetary easing. The effective tax rate for the quarter was 38.2%, a decrease from 70.7% in the same quarter last year.

For the full fiscal year 2025, FCCL’s earnings increased by 62% year-on-year to Rs13.33 billion, primarily due to an increase in gross margins to 35.5% from 32.1% in the previous fiscal year. Analysts maintain a buy stance on FCCL, with the company trading at a projected price-to-earnings ratio of 6.6x for FY26 and 5.8x for FY27, according to JS Global.