HUBC Reports Strong FY24 Results with Impressive Dividend Announcement

The Hub Power Company Limited (HUBC) has reported robust financial results for the fiscal year 2024 (FY24), with consolidated earnings reaching PKR 70,018 million (Earnings Per Share: PKR 54.0), marking a 22% year-on-year (YoY) increase compared to PKR 57,554 million (EPS: PKR 44.4) in FY23. Despite a 14% YoY decline in profitability during the fourth quarter of FY24 (4QFY24), where earnings fell to PKR 20,472 million (EPS: PKR 15.8), the company surprised investors with a cash dividend of PKR 8.50/share, bringing the total dividend for FY24 to PKR 20.0/share.

Result Highlights

1. Revenue Growth: Net sales for FY24 rose by 14% YoY to PKR 130,526 million, driven by increased dispatches from Thar Energy Limited (TEL), which saw a 57% YoY surge, and the devaluation of the Pakistani Rupee (PKR) against the US Dollar. The topline for 4QFY24 also showed an 8% YoY increase, reaching PKR 35,091 million.
2. Improved Margins: HUBC’s gross margins for FY24 improved by 600 basis points YoY, standing at 52%. The gross margins remained stable at 53% during 4QFY24 compared to the same period last year.
3. Profit from Associates and Joint Ventures: The company’s share of profit from associates and joint ventures grew significantly by 44% YoY to PKR 49,361 million in FY24, largely due to the profitability of ThalNova Power Thar Limited (TNPTL), which achieved Commercial Operation Date (CoD) on February 17, 2023, and the devaluation of the PKR. However, in 4QFY24, this profit slightly declined by 1% YoY to PKR 14,657 million.
4. Finance Costs: Finance costs increased by 38% YoY to PKR 26,744 million during FY24, attributed to higher interest rates and the addition of TEL’s finance costs. However, there was an 18% YoY decline in finance costs during 4QFY24 due to the reduction in long-term loans.

Additional Information

HUBC has entered into a joint venture with Ark Metals (Private) Limited, a mining company, through its wholly owned subsidiary, Hub Power Holdings Limited (HPHL). This venture aims to explore and develop mineral mines in Pakistan. The completion of the agreement is subject to obtaining the necessary regulatory approvals and consents.