Lahore: Nishat Chunian Power Limited (NCPL) has successfully navigated a challenging fiscal year, ending June 30, 2024, with a notable increase in its after-tax profits, according to the company's latest financial statements. Despite a decrease in revenue, the company’s strategic financial management and operational efficiencies bolstered its financial position.
In the fiscal year 2024, NCPL reported a revenue of PKR 15.22 billion, a decrease from the previous year's PKR 18.2 billion. The drop was attributed to lower generation demand from its main customer, the Central Power Purchasing Agency Guarantee Limited (CPPA-G). However, the company managed to increase its after-tax profit to PKR 4.91 billion, up from PKR 3.95 billion in 2023, primarily due to a reduction in cost of raw materials and efficient management of operational and maintenance costs, which are levelized over a 25-year period as per the tariff terms.
According to information available from the Pakistan Stock Exchange (PSX), NCPL's earnings per share (EPS) also saw a rise, reaching PKR 13.37 compared to PKR 10.77 in the previous year. The improved profitability was partly due to the delay payment mark-up accrued from the Power Purchaser's continued default on timely payments, a recurrent issue that has affected the liquidity but contributed to the bottom line through financial income.
The company's operational capacity utilization witnessed a decline, with the capacity factor reducing to 13.99% from 22.52% in 2023, alongside a dispatch of 240,447 MWh to the Power Purchaser, down from 386,127 MWh in the previous year. However, the availability factor improved to 93.77% from 91.40%, highlighting better operational readiness and efficiency.
Nishat Chunian Power's board, acknowledging the fiscal prudence and operational achievements amidst market challenges, expressed confidence in the company’s strategic direction and its ability to maintain sustainable operations. The board emphasized the importance of amicable resolutions with the Power Purchaser and the initiation of arbitration proceedings under the Arbitration Submission Agreement with the Government of Pakistan, which are expected to positively impact future operations and financial stability.
The company's financial health is further evidenced by its robust total equity, which stood at PKR 29.17 billion, up from PKR 24.26 billion in 2023, supported by a strong net income performance. Total liabilities decreased slightly, demonstrating effective debt management and operational efficiencies.
NCPL's commitment to corporate governance and compliance with regulatory requirements remains a priority, as outlined in the detailed disclosures in their annual report, available through QR codes and direct downloads from their website.
In conclusion, while facing reduced demand and operational challenges, Nishat Chunian Power Limited has demonstrated resilience and strategic acumen, positioning itself well for future stability and growth. The company's focus on efficient operations, prudent financial management, and compliance with governance standards continues to drive its success in Pakistan's power sector.