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PSO maintains its market leadership position, net profit jumps in fiscal year 2016

Pakistan State Oil (PSO), the country’s largest oil marketing company, reported a 50 percent increase in its net profit at Rs10.27 billion for the year ended June 30, 2016 owing to decrease in the company’s cost of sales. The oil marketing company earned Rs6.93 billion during the previous year exchange.

PSO also announced a final cash dividend of Rs7.5 a share, which is in addition to already paid interim cash dividend of five rupees per share.

The company posted earnings per share (EPS) of Rs37.81 for the fiscal 2015/16 as compared to Rs25.53 EPS for 2014/15.

The result was according to market expectations. The firm’s cost of sales amounted to Rs655.10 billion in the period under review, down 26 percent as against Rs890.17 a year earlier.

Gross profit of the PSO remained at Rs22.86 billion as against Rs22.92 billion. Gross profit was lower than the estimates because of the lowering inventory gains.

Inventory gains for the quarter are estimated to have clocked in at Rs600 million, which was offset by higher than estimated other income attributable to a higher quantum of penal markup income.

In fiscal year 2016, gross sales of the company stood at Rs906.20 billion, down 19 percent from Rs1.114.41 trillion recorded during the previous year.

After sales tax deduction, net sales came at Rs677.96 billion as compared to Rs913.09 billion.

Other income of the company declined to Rs12.79 billion in the period under review as compared to Rs13.93 billion a year ago.

Earnings for the last quarter clocked in at Rs20.9/share, up 48 percent year on year, relative to a loss of Rs7.8/share in the previous quarter.

Similarly, the company booked a profit after tax of Rs5.7 billion in the fourth quarter of fiscal year 2016 as compared to a net loss of Rs2.1 billion in the preceding year.

The shareholders appreciated the company’s performance in fiscal year 2016 as PSO maintained its market leadership position with an overall market share of 56.0 percent despite stiff market conditions.

PERFORMANCE BETTER IN FIRST 9 MONTHS OF FISCAL YEAR 2017

Pakistan State Oil earnings have been robust in the first 9 months of the fiscal year 2017.

Total sales of Pakistan State Oil (PSO) were up 62 percent to Rs218 billion driven by higher oil prices, casting positive impact on PSX trading.

This was due to favorable growth of sales volume and net margin and reduction in finance cost (despite increase in average borrowings by Rs19.5 billion) during the period due to effective treasury management.

Growth in white oil (petrol & diesel) was said to have also contributed to higher sales and gross profits for the company during the first quarter of the current year.

International oil prices was said to have surged by 77 percent in the period under review which was partially reflected in local ex-refinery prices.

During the period, the company showed volumetric growth in Mogas of 11 percent, in HSD of 12 percent, in JP-1 of 22 percent and in FO of 15 percent over same period last year (SPLY).

LPG business showed a growth of 132 percent, CNG business grew by 15 percent, Lubricants sales volume grew by 25 percent, whereas LNG business grew by 107 percent over SPLY.

The PSO continued to lead the liquid fuel market with an overall market share of 55.1 percent (9MFY16: 55 percent).

The market share of Black Oil rose to 72.7 percent from 69.5 percent SPLY, whereas the market share in White Oil stood at 44.6 percent vs. 45.9 percent SPLY.

Pakistan State Oil Company (PSO) posted Rs4.141 billion as profit after tax in the quarter ended March 31, 2017 as compared to after tax loss of Rs2.131 billion in the corresponding quarter in 2016.

The company’s earnings per share stood at Rs15.24 in the period under review against per share loss of Rs7.85 in the same quarter last year.

The board of directors of the company in its meeting held on April 23, 2017 recommended an interim cash dividend for the financial year ending June 30, 2017 at the rate of Rs10.00 per share, equivalent to 100 percent.

According to the financial results, the company’s net sales increased to Rs218.160 billion in this quarter against Rs134.614 billion in the same quarter last year while cost of product sold increased to Rs208.928 billion against Rs135.224 billion.

The company’s profit after tax increased to Rs14.156 billion translating earning per share of Rs52.10 in the nine month period ended March 31, 2017 as compared to PAT of Rs4.593 billion with EPS of Rs16.91 in the same period a year back.

PSO imported 69 percent of industry imports to ensure uninterrupted product supply across the country.

Furthermore, refinery upliftment improved to 37 percent (9 percent increase over SPLY) and new Cards business solution went live on March 1, 2017.

Non Fuel Retail initiated deployment of “Refuel” vending machines and ATMs at PSO’s retail stations nationwide.

The company is also undertaking brand building activities and corporate campaign was launched in January 2017 with the theme “Every Journey Begins Here”.

PSO CSR Trust has been formed for carrying out CSR activities in the fields of Education, Health Care, Community Building.

The outstanding receivables (inclusive of LPS) as of March 31, 2017 stood at Rs285.5 billion (June 30, 2016: Rs240.6 billion) against supplies of Black Oil, White Oil and LNG.

The receivables position improved when Rs20 billion was injected in February 2017 due to the intervention of Ministry of Petroleum & Natural Resources/Ministry of Finance/Ministry of Water & Power.

Efforts are underway to maintain Furnace Oil supply chain during Ramazan/summer of this year and to improve the outstanding receivables position.

The management of the company expressed gratitude to its shareholders, customers, business partners and other stakeholders for their trust in the company and to the Government of Pakistan, especially the Ministry of Petroleum and Natural Resources for their continuous guidance and support, the PSO statement added.

Pakistan State Oil (PSO) has signed two agreements with two different companies for import of the Liquefied Natural Gas (LNG) at a price of 13.37 per cent of Brent for supply of 4.5 million tons per annum (MTPA) LNG.

The PSO has made agreements with Qatargas (government-to-government basis), which is supplying 3.75 MTPA LNG at a price of 13.37 per cent of Brent and with M/s Gunvor (through competitive bidding) at a price of 13.37 per cent of Brent for supply of 0.75 MTPA LNG.

Moreover, Pakistan LNG Limited (PLL) has made agreement with M/s Gunvor (through competitive bidding) for supply of 0.75 MTPA LNG at price of 11.6247 per cent of Brent.

PSO made the agreement with Qatargas for 15 years and with M/s Gunvor for 5 years, while the PLL made the agreement with the Gunvor for 5 years too.

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