Bank Al-Habib 9-month profit surges 89 percent

KARACHI: Bank Al-Habib Limited on Wednesday announced its profit for the nine months’ period ended September 30, 2020 (9MCY20) jumped 89 percent to Rs13.237 billion (EPS: Rs11.91), mainly on strong net interest income (NII).

The bank had earned Rs6.993 billion (EPS: Rs6.30) in the corresponding period a year earlier, the bank said in a statement.

Brokerage Topline Securities in a note said, “The bank’s NII was expected to increase as the deposit mix of the bank enabled it to reduce Interest Expense by 6 percent QoQ. With Interest Earned standing ground, NII expanded by 8 percent QoQ”.

Fee Income increased by 26 percent QoQ followed by Dividend Income (+98 percent QoQ) and Forex Income (+35 percent QoQ), leading to an overall increase in NFI (Non Funded Income) by 40 percent QoQ, the brokerage house added.

“The bank was also able to surpass pre-COVID Q12020 NFI level of Rs2.2 billion,” Topline said.

The BAHL’s operating expenses saw a decline of 1 percent QoQ, the brokerage said terming it to be the most impressive given the bank had added 56 branches to its network in 1H2020. Moreover, cost to income for the quarter came in at 43 percent compared to 49 percent in 2Q2020.

Provisioning continued for the bank in order to maintain 100 percent+ coverage ratio and likely as a precautionary measure in the general segment.

Allied Bank 9M profit rises 31pc

Allied Bank Limited reported that its 9MCY20 profit increased 31 percent to Rs12.633 billion (EPS: Rs11.03) from Rs9.637 billion last year, mainly because the bank’s net interest income (NII) made strides during the period under review. Brokerage Arif Habib Limited in a report, said, “The bank’s NII settled at Rs37.1 billion for 9MCY20, rising 29 percent YoY, while it declined 9 percent QoQ owing primarily to a 17 percent QoQ downturn in interest income”.

The report added that this YoY jump was largely due to a steep reduction in the bank’s interest expense (-15 percent YoY). “We believe a 17 percent QoQ decline in interest income is because of asset repricing, which was due to kick in the outgoing quarter,” the brokerage said.

NFI (Non Fund Income) of the bank posted a surge of 16 percent YoY during 9MCY20 primarily owing to capital gains this year of Rs2.8 billion against a gain of Rs0.9 billion in the same period last year. This quarter the bank booked lower capital gains (Rs549 million).

The bank’s fee income also supported the overall profitability, with total income from fee, commission and brokerage clocking in at Rs4.6 billion during 9MCY20 against Rs4.1 billion recorded during same period last year. The bank’s forex income was down in 9MCY20 as international trade activities remained subdued due to COVID-19 pandemic, declining 20 percent YoY, the brokerage house said.

It added that the bank’s provisioning expenses clocked in at Rs199 million (down 87 percent QoQ) in 3QCY20, while provisioning during 9MCY20 was Rs2.4 billion against a reversal of Rs356 million, recorded in the corresponding period last year.

BAFL 9-month profit slips 8pc

Bank Al-Falah Limited’s profit for first nine months of calendar year 2020 fell 8 percent to Rs8.662 billion (EPS: Rs4.87) from Rs9.481 billion (EPS: Rs5.35) in the corresponding period a year earlier, a statement said.

The bank has announced an Interim Cash Dividend for the 3rd quarter & nine months period ended September 30, 2020 at Rs2/share, which is equivalent to 20 percent.

Brokerage Arif Habib Limited in a report said, “Net Interest Income of the bank settled at Rs34.5 billion, improving 3 percent YoY during 9MCY20, while declining 4 percent QoQ”.

The report added that the BAFL’s earned interest declined 9 percent QoQ as an impact on asset yields of rate cuts came in, whereas interest expense saw a 14 percent QoQ decline.

“A 100 basis points rate cut in June likely curtailed cost of deposits of the bank and asset repricing largely kicked in for the bank as its large consumer portfolio was already re-priced during second quarter,” the brokerage said.

The bank’s NFI witnessed a 23 percent sequential downturn with capital gains settling at Rs453 million (down 75 percent QoQ).

Fee income posted a strong recovery of 42 percent QoQ. On a yearly basis, the NFI was supported by capital gains of Rs2.1 billion during 9MCY20 against losses of Rs437 million in the same period last year, the brokerage house added. This quarter the bank posted drastically lower provisions of Rs1.5 billion (-54 percent QoQ). On a yearly basis provisions were three times higher during 9MCY20 on the back of general provisions (to create a buffer and build coverage against possible NPL (Non Performing Loans) accretion due to COVID) as well as specific provisions.

Attock Cement Q3 profit jumps 64pc

Attock Cement Pakistan Limited’s (ACPL) profit for the quarter ended September 30, 2020 (Q3CY20) surged 64 percent to Rs691.7 billion (EPS: Rs3.37), compared to Rs421 billion (EPS: Rs2.88) earned in the same period last year.

According to analysts at brokerage Arif Habib Limited, the company’s topline in Q1FY21 settled at Rs5.2 billion, up by 5 percent YoY on the back of a 9 percent jump in dispatches to 824,000 tons (local offtake posted an uptick of 4 percent YoY to 306,000 tons while exports grew by 13 percent YoY to 518,000 tons). “We do highlight that on a QoQ basis the recovery appears noteworthy (+77 percent YoY) courtesy solid growth in cement dispatches (+72 percent QoQ amid end of Corona lockdown) and rebound in retention prices (PKR 25/bag cut in FED post FY21 Budget),” analysts at the brokerage said.

Analysts said the gross margins of ACPL dwindled 759bps YoY to 18.6 percent during Q1FY21 amid deprecation in the rupee against dollar and a hit from higher energy tariff (additional KEL charge of Rs2/KwH together with end of PM’s subsidy of PKR 3/KwH), which offset the impact of lower coal prices.

“On a QoQ basis, margins slipped by 1.34ppts (4QFY20: 19.9 percent) given aforementioned reasons,” the analysts added.

Moreover, the finance costs of the company dipped 71 percent YoY to Rs46 million in Q1FY21, attributable to cut in interest rate and decline in borrowing.

ICI Q1FY21 profit ticks up 6pc

ICI Pakistan Limited announced that its net profit for the first quarter of fiscal year FY2020-21, ended September 30, 2020, increased 6 percent to Rs886 million, while EPS (Rs10.66) improved 18 percent.

“On a consolidated basis (including the results of the Company’s subsidiaries: ICI Pakistan PowerGen Limited and NutriCo Morinaga (Pvt) Ltd), net turnover for the quarter under review was Rs14.465 billion, which was almost in line with the same period last year,” the company said in a statement.

“Whereas operating result at Rs1.456 billion was lower by 11 percent in comparison to the same period last year.”

The increase in profitability was mainly on the back of lower finance cost (due to lower interest rates and lower debt) along with stable exchange rate, the company said in the statement. “The company recognised Rs103 million as share of profit from its Associate (NutriCo Pakistan (Private) Limited),” the statement said adding, “On a standalone basis, profit after tax and EPS for the quarter under review at Rs934 million and Rs10.11, respectively, were 1 percent higher over the same period last year”.