HUBCO announces higher-than-expected dividend in FY24's fourth quarter

Hub Power Company (HUBCO) achieved a record-breaking profit of PKR 70.0 billion in fiscal year 2023-2024, marking a 22% year-on-year (YoY) growth, with earnings per share reaching PKR 53.98.

In FY24's fourth quarter, the company's earnings rose by 19% quarter-on-quarter to PKR 20.5 billion, according to financial results shared on the Pakistan Stock Exchange website on Monday.

The company declared a cash dividend of PKR 8.50 per share for the fourth quarter, bringing the total FY24 dividend to PKR 20.0 per share, compared to PKR 30.0 per share last year.

HUBCO's consolidated earnings were in line with market expectations. However, the company surprised analysts with a higher-than-expected dividend, supported by a stronger cash position.

The earnings growth is largely driven by a 44% YoY increase in the share of profit from associates and joint ventures, which amounted to PKR 49.3 billion, up from PKR 34.3 billion in FY23. However, finance costs also surged by 38% YoY to PKR 26.7 billion, primarily due to rising interest rates.

HUBCO announced that its subsidiary, Hub Power Holdings Limited (HPHL), has entered into a joint venture agreement with Ark Metals (Private) Limited and its shareholders for the exploration and development of mineral mines in Pakistan. The consummation of this joint venture agreement is subject to the necessary regulatory approvals and consents.

Hub Power Company, Pakistan's largest independent power producer, operates power plants with a combined capacity of 3,581 megawatts, utilizing RFO, hydel, local coal and imported coal. The company has also diversified into the oil and gas exploration sector and is expanding into the automotive sector through a partnership with BYD, the world’s largest electric vehicle manufacturer.