Bumper Profit: Hub Power’s Profit rises amid Rupee Devaluation

September 13, 2023

Hub Power Company (HUBC) announced its 4QFY23 result today wherein company reported profit to equity owners of PKR23.9bn (EPS of PKR18.4) up 241% YoY.

This takes full-year earnings to PKR57.6bn (EPS of PKR 44.4) for FY23, which is the highest ever in its history.
Along with the result, company announced final cash dividend of PKR6/share, taking total FY23 dividend to PKR 30/share which is also highest ever dividend in its history.

4QFY23 result came higher than industry expectations due to higher share of profit from associates and JV.
Share of Profit from Associate and JV jumped by 128% QoQ to PKR 14.8bn. The significant increase is due to full impact of ThalNova Power Plant which started commercial operation on Feb 17, 2023 followed by higher earnings contribution from China Power Hub Generation Company (CPHGC) amid rupee devaluation against US dollar

Finance cost increased by 199% YoY and 58% QoQ to PKR 7.5bn in 4QFY23. This is likely on
the back of higher borrowings to finance the newly operational ThalNova plant and Thal Energy alongside higher short term borrowings and higher interest rates.
• Effective tax rate of HUBC clocked in at 8% in 4QFY23 as compared to 34% in 4QFY22 and 14% in 3QFY23.

PKR in Million	4QFY23	4QFY22	YoY	QoQ	FY23	YoY
Net Sales	32,345	32,106	1%	19%	114,263	18%
Operating Costs	15,284	23,459	-35%	8%	61,485	-4%
Gross Profit	17,061	8,647	97%	30%	52,778	59%
Admin Exp	394	260	51%	15%	1,368	33%
Other Income	2,838	1,417	100%		3,585	69%
Other Operating Exp	-437	284			79	-80%
Finance Cost	7,479	2,500	199%	58%	19,323	144%
Profit from Asso. & JV	14,763	4,236	248%	128%	34,316	272%
Profit Before Tax	27,736	11,256	146%	94%	70,418	101%
Taxation	2,159	3,857	-44%	6%	8,411	52%
Profit After Tax	25,576	7,399	246%	108%	62,007	110%
EPS	18.43	5.41			44.37