By the grace of the Almighty, I am humbled to share that 2021 was a year of accomplishments and growth for Engro Corporation and its group companies. Despite the challenges that came our way, the Group posted healthy business results and achieved significant milestones. It is my pleasure to share with you the highlights of Engro Corporation’s performance in 2021 and the efforts made to help solve some of Pakistan’s most pressing issues.
Throughout the year, continuous efforts were directed toward tackling and recovering from the problems posed by the COVID-19 pandemic. Uncertainty associated with the health and well-being of people, inflation spurred by monetary and fiscal stimuli, supply chain limitations, and commodity cycle volatility were a few of the challenges faced during the year. Together, we managed to rise above these challenges, stronger and more united than before. Apart from playing an integral role in producing value for the Country, we also made continued efforts to protect our people alongside proactive contributions to support the wider communities in which we operate and beyond. Engro continued to fulfill its role in combating COVID-19 under the banner of the PKR 1 Billion Hussain Dawood Pledge, which focuses on disease prevention, enabling healthcare practitioners, enabling patient care, and bolstering livelihood & sustenance. To date, total spend under the Hussain Dawood Pledge stands at PKR 498 Million.
I would like to take this opportunity to thank the Government for concentrated and effective measures taken to contain the pandemic in the Country while also facilitating business continuity. It was with the support of the Government, the invaluable guidance from our Chairman, Vice Chairman, the Board of Directors, and our team members that Engro was able to adapt to the changing environment and achieve some notable milestones with great resilience.
At Engro, we believe that our people are the cornerstone to our success and we are driven to facilitate their development while protecting their health. During these testing times, several emotional and physical wellbeing programs were introduced to assist our colleagues in tackling the various challenges faced during these unprecedented times. Engro is further determined to create an inclusive work environment and has identified diversity as a key focus area to improve the participation of women in the workforce. We have taken various steps to adhere to our commitment by introducing family-friendly policies such as day care solutions at all our working locations and going beyond legally-mandated parental leaves to support our employees.
On the business front, Engro Corporation posted a consolidated profit after tax of PKR 52.6 Billion for 2021, up from PKR 44.1 Billion in the previous year.
On a standalone basis, our profit stood at PKR 18.5 Billion. Engro Fertilizer registered its highest ever Urea sales netting a total revenue of PKR 132.4 Billion, substituting a potential USD 1.3 Billion worth of Urea import in the process. The expansion of our PVC facility coincided perfectly with high international PVC prices enabling Engro Polymer to register a record profit of PKR 15.1 Billion. Moreover, our rice business continued its focus towards exports and generated a revenue of USD 19 Million. With the intent to reduce the national digital divide, we have made a total equity commitment of PKR 21.5 Billion towards Engro Enfrashare for catering to the growing demand for Build-to-Suit Towers and enabling a scale of 5,000+ towers by 2025
Mining operations and Engro Powergen Thar ensured a supply of consistent and affordable energy to the Country. Engro is committed to expanding the coal mine with an expected capacity increase to 7.8 Million tons per annum by 2022 and 12.2 Million tons per annum by 2023. The energy business will continue to endeavor toward development of a bilateral electricity market by working closely with the regulators and industry stakeholders to revamp the power sector. The business will also continue to work extensively to gain a foothold in the renewables market. Engro Elengy successfully handled Pakistan’s first-ever Dry-Docking activity of an FSRU while ensuring gas supply continuity through arranging a backup FSRU. The business remains committed to further bridging the energy gap by unlocking opportunities for private LNG import.
In April 2021, the Board of Engro Corporation approved USD 31.4 Million for initiating the FEED study for our flagship PDH project. I am happy to report that significant progress has been made on this front.
As companies across the world accelerated the pace of digitization amidst the pandemic, Engro took the initiative to undertake one of the largest digital business transformations in the Pakistani private sector with a singular SAP implementation – Engro OneSAP. The project enabled us to ensure business continuity and efficiency through integration of business processes, agility, and data-based decision making. Additionally, our businesses leveraged technology-based solutions for online sales with Engro Fertilizers now becoming one of the largest e-sales companies in Pakistan.
In today’s rapidly evolving world, we believe that shareholder value maximization is only possible by ensuring sustainability and implementation of the best-in-class ESG standards in our processes and practices. Therefore, one of our key strategic imperatives going forward will continue to be the transition to sustainability. As a member of the World Economic Forum and the only Pakistani company to sign WEF’s Stakeholder Capitalism Metric pledge, we have demonstrated increasing commitment in this space in the past and present, and will continue to do so in the future.
I am delighted to acknowledge that the constant efforts made by our teams to achieve excellence were lauded at various national and international forums. Among numerous achievements, Engro Corporation was recognized by CFA Society of Pakistan for our excellent investor relations (third year in a row), we were rated Pakistan's Most Outstanding Company in the Industrial Sector by Asiamoney (third year in a row), endorsed by SAP as Pakistan’s largest digital business transformation in the private sector, and secured the UN Global Compact Business Sustainability Award (third year in a row).
Once again, I would like to extend my gratitude to our Chairman, Vice Chairman, and the Board of Directors for navigating us through another year of immense success. I would also like to thank all our stakeholders for trusting us. To the entire Engro Family, I would like to commend and congratulate each and every one of you for an astounding level of resilience and commitment to excellence which has helped us get to where we are today. I look forward to another year of hope, faith, resilience, and many more milestones.
Ghias Khan
President