STAFF REPORT IBD: Gas curtailment caused by the flagrant violation of the contractual obligations by SNGPL has severely impacted the operations of the fertilizer business in Pakistan. Due to this negative situation, the Engro Corporation Limited made a net loss of Rs 2,978 million during the nine months of 2012 as compared to the net profit of Rs 3,510 million during the same period last year.
This was disclosed at a meeting of Board of Directors of the company here last week. The loss is directly attributable to decreased sales volume, lower margins, declining farm economics, and absence of speculative buying due to expectation of a reduction in the price.
The Company produced 709,000 tons of Urea this year compared to 983,000 tons produced in the same period of previous year. This decrease was attributable to the gas curtailment on the new plant which received gas for only 45 days allowing for only 33 days of production in the period under review.
Due to worsening gas supply situation, the company has been working on securing off-network sources of gas. Proposals for short term and long term solutions in this regard are under consideration by various government bodies.
On the contrary, the foods business continued its rapid growth trajectory registering a turnover increase of 38% to Rs 29 billion during the nine months of 2012 as compared to Rs 21 billion for the corresponding period last year.