KARACHI, Feb 6: The Hub Power Company Limited (Hubco) announced on Thursday net profit of Rs2.9 billion for the six months ended December 31, 2002, which was about the same as in the corresponding period of the previous year.

The profit figure came close to the expectations of most stock analysts, who were projecting between Rs2.8 and Rs3 billion, but an occasional analyst whose earnings forecast fell as wide off the mark as by more than a billion rupees, could not be reached on Thursday, for comments.

As was announced by the company earlier, the board did not declare an interim dividend on Thursday. “The Board of directors decided to consider an interim dividend at the board meeting to be held in early March 2003”, said a company notice adding, “As already announced on January 27, 2003, the books will remain closed from March 31 to April 11, 2003 (both days included). Most analysts commented that the company’s cash flow allows it to pay an interim dividend of Rs3 to Rs3.50 per share, when the board next meets in March. The last and final instalment of Rs1.2 billion due from Wapda had already been received by the company, which, most analysts thought would be distributed to the shareholders.

The market greeted Hubco’s half term results with 55 paisa increase in the price of stock that closed at Rs35.15, from the overnight rate of Rs34.60 with volume of 45 million shares. Earning per share (eps) for the half year worked out at Rs1.49, which produced the price-to-earnings (p/e) ratio of 7x, on the annualized earnings.

The directors’ report, signed by the company chief executive, Vince R. Haris said that during the quarter the power plant was run at a load factor of 32 per cent generating 858 GWh of electricity. “This is due to the country having better monsoon rainfalls this year compared to last year which has resulted in Wapda being able to increase the hydel electricity generation”, CEO stated.

Turnover for the quarter was Rs5.2 billion and operating costs Rs3.2 billion. “These numbers are higher compared to the corresponding period last year, mainly due to the difference in load factor”, said the directors’ report. Net profit for the quarter amounted to Rs1.4 billion, which also was about the same as in the same period of last year.

The company said that routine maintenance was carried out on all four units during the quarter, to ensure the long term integrity of the power plant. All programmes were completed as planned.

The company stated that Hubco was working closely with Wapda to reduce financing costs. In this regard, on January 8, 2003, an agreement was signed with a syndicate of Pakistani banks led by the National Bank of Pakistan (NBP) to reduce the mark-up rate on Senior Rupee Facility from 26 to 15 per cent effective from January 2002, resulting in savings of Rs195 million which would be passed to Wapda.

First replacement Generator Transformer (GT) from Toshiba was expected to arrive at site by mid-February 2003. “Meanwhile, insurance continued to be unavailable for the two operational Ansaldo Generator Transformers, until the opportunity to exchange them for new replaced Toshiba Transformers is taken later this year”, the company cautioned.

Lastly, directors mentioned that Hubco and its Operation & Maintenance Contractor — International Power plc — had jointly signed an agreement with the Citizen Foundation of Pakistan to set up a school in Hub.