Corporate Briefing Notes
Saif Power Limited (SPWL) conducted its corporate briefing session today to discuss the financial results for CY22 and to highlight its future outlook.
Key Highlights
● To recall, SPWL reported a revenue of PKR22.9bn in CY22 compared to PKR16bn in SPLY. The increase in sales was attributed to the relatively higher demand.
● Net profit of the company remained flat at PKR1.9bn (EPS: PKR5.05/sh) in CY22 against PKR1.9bn in SPLY.
● The management informed that the company’s receivables still remained a challenge as total amount stood at PKR11.6bn as of CY22. However, Company ensured that there is enough amount of working capital to carry on the operations.
● Capacity utilization of the plant dropped from 41.09% in CY21 to 34.53% in CY22.
● The dividend payout has continuously increased for last two years, growing from 37% in CY20 to 80% and 85% in CY21 and CY22 respectively.
● Talking about the sale of land and other assets of the company, the management shared that the agreements have been signed and the execution is under process with the buyer.
● As per management, two agreements of “Master Agreement” and “PPA Amendment Agreements” were revised last year. According to these amendments, the receivable of PKR9bn would be received in two tranches, and fuel and O&M savings will be shared in a ratio of 60:40 between power purchaser and the company.
● Furthermore, Return on Equity During Construction (RoEDC) has divided between local and foreign investors with the proportion of 17% and 12%, respectively.
● The management also confirmed that the long-standing dispute of PKR477mn with CPPA-G has been resolved.
● Regarding the delayed payment rate, the company disclosed that it has been categorized into two ways. For the first 60 days, this rate will be KIBOR + 2% and the KIBOR + 4.5% then afterward. To note, the treatment is exclusive of RLNG invoices.
Future Outlook
● Going-forward, the management highlighted that SPWL will continue paying higher dividend if there’s any additional cash available in the future. However, company also feared that if current economic challenges persist, the recovery of invoices could be a major problem for the company.
Important Disclosures
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