HUBCO posts Rs 75 billion profit amid IPP debate and high electricity prices

KARACHI: Hub Power Company Limited (HUBCO), the largest Independent Power Producer (IPP) in Pakistan, reported a significant rise in profits for the fiscal year 2023-24 concluding June 30.

The company posted a profit of Rs 75.29 billion, reflecting a year-on-year growth of over 21 per cent, according to their financial results published on the Pakistan Stock Exchange’s (PSX) website. This is up from last fiscal year’s consolidated profit of Rs 62 billion.

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HUBCO also announced a final cash dividend of Rs 8.5 per share, on top of an interim dividend of Rs 11.5 that was announced during the financial year.

HUBCO’s revenue from contracts with customers rose by more than 14 per cent to Rs 130.5 billion in FY24, up from Rs 114.3 billion in the prior year. The cost of revenue, however, increased minimally from Rs 61.5 billion last year to Rs 62.2 billion this year.

As a result, HUBCO’s gross profit increased by over 29 per cent to Rs 68.3 billion in FY24, translating to a profit margin of 48 per cent, up from 46 per cent in the previous fiscal year.

This comes amidst the ongoing debate take or pay of IPP contracts in Pakistan and exorbitantly high electricity prices. It is notable here that HUBCO’s statement to PSX said that the company has paid Rs 14.7 billion in taxes during the outgoing fiscal year, a 74 per cent rise from the previous year.

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HUBCO’s total installed power generation capacity stands at 3,581 MW. The company operates across multiple sectors, including oil and gas, mining, and industrial operations and maintenance services through its subsidiaries.