PSO reports profit after tax of Rs. 4.2 billion in 1H FY19
The Board of Management (BOM) of Pakistan State Oil Company Limited (PSOCL) has reviewed the performance of the Company for first half of the financial year 2019 (1HFY19) in its meeting held on February 16, 2019.
The challenging economic trend in the country fueled by rupee devaluation and adverse balance of payment position resulted in negative growth of 27% in the cumulative liquid fuel market with negative contribution of white oil and black oil of 12% and 60% respectively. Black oil volumes have been impacted significantly due to power production shift towards RLNG in the country, based on a GoP decision.
Despite the challenging economic scenario, PSO lead the liquid fuel market in 1HFY19 with an overall market share of 40.9% (increase of 0.7% market share vs. Sept 18 quarter). In spite of soaring outstanding receivables (inclusive of LPS) from the Power Sector, PIA and SNGPL as of December 31, 2018 which stood at Rs. 325 billion (September 30, 2018: Rs. 310 billion), PSO maintained the sensitive supply chain by importing 48% of total industry imports and up lifting 36% of total refinery production in the country.
The economic down trend and reduction in overall market size has impacted the Company’s profitability. During the period under review, the Company reported Profit after Tax (PAT) of Rs. 4.2 billion. Major reasons for reduction in PAT as compared to same period last year are lower gross profit mainly due to dip in sales volume of black and white oil, higher inventory loss due to reduction in international Oil prices, increase in finance cost due to sharp hike in discount rate by SBP and higher average borrowing levels vs. same period last year, lower interest income from power sector and foreign exchange loss on account of PKR devaluation.
Despite stiff competition in the industry especially due to an increase in the number of OMC’s and a shrinking market size, PSO is making an all-out effort to maintain its market share and leadership position with sustained profitability. The management expressed sincere gratitude to all stakeholders including Government of Pakistan, especially Petroleum division of Ministry of Energy and shareholders of the company for their continued support and guidance.
PTCL wins EFP Award on Best HRM Practices 2018
Pakistan Telecommunication Company Limited (PTCL) is the proud winner of the Employer Federation of Pakistan (EFP) Award on best Human Resource Management (HRM) Practices 2018.
Ahmed Jalal, Executive Vice President, HR Operations, PTCL, received the award on behalf of PTCL fromHonorable Governor Sindh, Imran Ismail, who was the Chief Guest at the event organized by the EFP. The conference was attended by leading corporate personalities and a number of dignitaries.
On the occasion, Syed Mazhar Hussain, Chief Human Resource Officer, PTCL, said, “It is an honour for us to stand out from other organizations of the country to win this prestigious award on best HRM practices. We will continue to foster a progressive culture with a challenging, innovative and flexible work environment, including a strong emphasis on gender equality to succeed and grow. PTCL believes in team work, continuous well-being of the employees and serving the nation.”
He lauded Employer Federation of Pakistan (EFP) and International Labor Organization (ILO) for encouraging healthy competition amongst organizations through such awards.
PTCL is deeply committed to building an inclusive and diverse culture. It has been at the forefront in introducing best HRM practices such as PTCL Pride, Ideas Olympiad, PTCL Razakar, Wellness@work, Facebook@work, Hello portal and several other CSR initiatives for the well-being of its employees.
Easypaisa to facilitate Central Depository Company’s account holders
Telenor Microfinance Bank (TMB) and the Central Depository Company of Pakistan Limited (CDC) have signed a Memorandum of Understanding (MoU) at CDC House Karachi. A salient feature of the MOU will be the Easypaisa platform which will facilitate CDC account holders in biometric verification and collection of funds. Signatories to the MoU were Shahid Mustafa, President & CEO Telenor Microfinance Bank and Badiuddin Akber, CEO Central Depository Company.
This is a first step to enable utilization of the branchless banking medium as an approach to transform the opportunity of investments for the investors of Capital Market and to create an ecosystem of financial inclusion for individuals who are unable to access this mode of saving. Under the MoU, both existing and new CDC account holders can easily reach out to 75,000 plus Easypaisa outlets located in more than 800 cities across Pakistan for In-Person Verification (IPV) of their CDC online accounts. Apart from Biometric Verification, the service will further incorporate utilization of Mobile Accounts for initiating investor payment, collection of account opening fee in case of new account holders, and collection of funds for payments initiated by any CDC Investor Account Services (IAS) account holder. Subsequent to this MOU, both parties have agreed to start working on developing a solution which will eliminate the need for visits by investors to the CDC premises for opening of an investor account with CDC.
Speaking at the signing ceremony, Shahid Mustafa, President & CEO, Telenor Microfinance Bank said, “Telenor Microfinance Bank is an established leader in driving digital financial inclusion across Pakistan. Easypaisa, with the help of its expansive network of agents all over the country, will be instrumental in facilitating smooth and convenient collection of funds and In-Person Verification for CDC. By collaborating with various partners from the financial sector such as the CDC we will continue to forge partnerships and support interoperability to enhance financial inclusion in Pakistan”
Sharing his thoughts on the development, Mr. Badiuddin Akber, CEO – CDC, remarked that this initiative is in line with the CDC’s strategic vision to support market development and to ensure ease of doing business in the capital market. Another major activity undertaken by the CDC is to extend depository outreach through use of technology to make the CDC Account Opening and other processes more efficient and user friendly.
Telenor Microfinance Bank is the largest proponent of financial inclusion in Pakistan. Having pioneered branchless banking in the country through ’Easypaisa’ a 360 degree digital financial platform, the Bank is providing innovative products and services to cater to a range of market requirements.
National Foods Limited Stands United with Special Olympics Pakistan
Since the start of its journey, National Foods Limited (NFL) has helped the growth of the community, at a national and international level. With this in mind, NFL has built its Corporate Social Responsibility mandates in line with the United Nations’ Sustainability Development Goals 3, 4 & 5. These cover quality education, good health, and gender equality.
National Foods collaborated with SOP in sponsoring the 4th Unified Marathon. NFL was the proud sponsor of this initiative as it reflected the efforts of the company’s vision towards community building and engagement. For this purpose, National Foods Limited nominated 30 students from its TCF ’Adopt a School’ Program who actively took part in the marathon and stood shoulder to shoulder with athletes from SOP.
The aim of the marathon was to inculcate a sense of belonging for all the participants which included participants from different walks of life. The Unified Marathon is an annual marathon in which approximately 3000 participants are registered, of which 1000 participants are intellectually disabled. This race is held to raise funds for SOP and to promote health, inclusion and increase visibility of the athletes.
Mr. Abrar Hasan, CEO of National Foods Limited, commended by saying, ’National Foods Limited has always looked towards building a stronger community. We believe in inclusion at every level of the society. We have worked hard over the years to build a corporation which reflects this thought. The Special Olympics Pakistan is a noble cause, which helps to further our company vision. We are proud to be a part of the Unified Marathon, and congratulate the participants, SOP and corporate partners for building a platform which brings these athletes into the folds of society.’
The race had four categories, Half Marathon (21km), 10km, 5km and Children’s Dash (700m). It was held at the Moin Khan Academy in DHA.
NBP records highest ever rise in revenue growth
Meeting of the Board of Directors (BoD) of National Bank of Pakistan (Bank) was held on February 22, 2019 at the Bank’s Head Office in Karachi. The BoD approved the financial statements of the Bank for the year ended December 31, 2018.
Maintaining its position in the industry, this year too, the Bank recorded solid growth in terms of both balance sheet size and the total revenues. Despite a generally difficult year for the banking industry, the Bank has achieved the highest ever total revenue in its history of seven decades. Total revenue of the Bank amounted to Rs. 96.9 billion which is 13.6% higher than Rs. 85.3 billion of previous year. While net interest/mark-up income increased by 11.8% to Rs. 60.7 billion (2017 : Rs. 54.3 billion); a 16.7% growth was also achieved in non-interest / mark-up income which stood at Rs. 36.2 billion.
Profit before provisions amounted to Rs. 41.0 billion which is 11.4% higher than Rs. 36.8 billion for the year 2017. During the year, the Bank recognised significant increase in loan-loss & other provisions which amounted to Rs. 11.3 billion as against Rs. 1.2 billion in the prior year. This is mainly due to default by a single borrower group which has been fully provided for. Therefore, the after-tax profit for the year is lower by 13.1% against previous year and amounted to Rs. 20.0 billion (2017: Rs. 23.0 billion). This translates into earnings per share of Rs. 9.41 (2017: Rs. 10.82). Pre-tax and after-tax return on average equity stood at 21.8% and 14.7% (2017: 29.8% and 18.7%) respectively.
Healthy growth in balance sheet size was also recorded as total assets of the Bank stood at Rs. 2.8 Trillion depicting a 11.7 % growth YoY. Bank’s gross loans & advances crossed the 1 Trillion mark and increased by Rs. 202.5 billion. The Bank’s deposits also crossed Rs. 2 Trillion mark as the same increased by Rs. 284.3 billion during the year. For better liquidity and rate-risk management, the Bank maintains a healthy portfolio of investment in low risk securities.
The Bank has filed a review petition against the judgement of the Supreme Court of Pakistan in the pension case and has also moved an application for constitution of a larger bench which has been accepted. Pending the decision of review petition, financial impact of the subject case has not been included in the instant financial statements as the Bank looks forward to a favourable outcome of the case.
The BoD is conscious of the fact that the shareholders look forward to receiving dividend. The Board deliberated at length whether or not cash dividend should be recommended. Keeping in view the significance of the amount involved in the pensions related case, the BoD considered it prudent to retain the profits for the time being to maintain & further strengthen capital base of the Bank. Accordingly, the BoD did not recommend any dividend for the year 2018.
2019 marks the Bank’s 70th year of service to the Nation. NBP is continuously expanding its market outreach through adding to its product range, restructuring its business model, and adopting modern-day delivery strategies. The Bank has special focus on promoting Home Remittances into Pakistan through the banking channel. Building on its extensive and ever growing network of correspondents, particularly in the Middle East, the Bank is offering hassle free remittances service across Pakistan. Provision of services through Alternate Delivery Channels and Customer Service Quality are also key focus areas of the Bank.
The Bank has just launched its Debit Card product and is realigning itself with the emerging e-banking dynamics to exploit every digital channel to maximise its market outreach for fulfilling customer expectations. During the year, the Bank added 23 more branches to its network of Aitemaad Islamic Banking. With “AAA” credit rating by the two Credit Rating agencies in Pakistan, the Bank is a driving force in the financial industry with its large distribution network domestic and international branches, and a wide range of products & services.
MCB Bank announces financial results for the year ended December 31, 2018
The Board of Directors of MCB Bank Limited, met under the Chairmanship of Mian Mohammad Mansha, on February 20, 2019 to review the performance of the Bank and approve the financial statements for the year ended December 31, 2018.
Unconsolidated Profit Before Tax (PBT) of the Bank for the year ended December 31, 2018 increased by 3% and was reported at Rs. 32.06 billion as compared to Rs. 31.01 billion for 2017, whereas Profit After Tax (PAT) for 2018 was reported at Rs. 21.36 billion.
During the calendar year 2018, the changing macro-economic factors made the operating environment more challenging with discount rate registering a steep increase of 425 bps in absolute terms. Based on the anticipated interest rate movement, the Bank focused on asset base with shorter maturities, resulting in 8% increase in net interest income over last year. On the gross markup income side, the Bank reported an increase of Rs. 9.2 billion over last year. Analysis of the interest earning assets highlights that income on advances increased by Rs. 10 billion, primarily on account of improved average advances volume of Rs. 83 billion coupled with increased yield of 92bps. On the investment side, gross markup income decreased by Rs. 2.2 billion, due to decreased average volume of Rs. 66 billion. On the interest bearing liabilities side, the cost of deposits increased by 69bps over last year, to corroborate to the increasing interest rates. The Bank increased its average deposits by Rs. 123 billion when compared with last year. Average borrowings volume registered a significant decline of Rs. 84 billion over last year.
The non-markup income block of the Bank was reported at Rs 17.2 billion with major contributions coming in from fee, commission income and income from dealing in foreign currencies. Fee income increased by 10% with major contributions from card related fee, remittances, commission on trade and bancassurance. On the capital market front, the Bank recorded capital gains amounting to Rs, 1 billion as compared to Rs. 3.8 billion in last year. Foreign exchange income reflected a healthy increase of Rs. 1.8 billion (+109%) over last year.
On the administrative expenses side excluding pension fund, despite the surge in inflationary pressures coupled with significant devaluation and increase in operational outreach, the Bank was able to contain the growth percentage to 10%. The increase includes the premium cost amounting to Rs. 559 million on account of deposit protection premium, which was effective from July 01, 2018. Barring the impact of deposit protection premium, the increase in operating cost was only 8.27%.
On the provision side, the bank reversed provision amounting to Rs. 2.9 billion on advances whereas the Bank recorded gross charge of 2.8 billion on equity portfolio in 2018.
On the financial position side, the total asset base of the Bank on an unconsolidated basis was reported at Rs. 1.5 trillion depicting a significant increase of 12% over December 2017. Analysis of the asset mix highlights that net investments have increased by Rs. 92.4 billion (+14%) whereas advances have increased by Rs. 34.2 billion (+7%) over December 31, 2017. Investment mix continued to shift from long-term PIBs to the short-term T-Bills during the year in the wake of rising interest rate scenario. Resultantly investment in T-Bills increased by Rs. 194 billion whereas investment in PIBs decreased by Rs. 95 billion.
The Non-performing loan base of the bank almost remained static with marginal increase of Rs. 203 million and was reported at Rs. 48.9 billion. The coverage and infection ratios of the Bank were reported at 88.26% (Dec 2017: 93.74%) and 8.95% (Dec 2017: 9.47%) respectively.
On the liabilities side, the deposit base of the Bank registered a significant increase of Rs. 81 billion (+8%) over December 2017. The increase of Rs. 81 billion is net of the deposits amounting to Rs. 22 billion transferred to MCB’s wholly owned subsidiary MCB Islamic Bank Limited under the scheme of demerger sanctioned by the Lahore High Court.
Earnings per share (EPS) for the year ended December 31, 2018 was Rs. 18.02 as compared to Rs. 19.56 for 2017. Return on Assets and Return on Equity were reported at 1.5% and 15.5% respectively, whereas book value per share was reported at Rs. 117.74.
While complying with the regulatory capital requirements, the Bank has paid the highest cash dividend per share in the industry with regular interim dividends and remains one of the prime stocks traded in the Pakistani equity markets. Bank’s total Capital Adequacy Ratio is 18.13% against the requirement of 11.90% (including capital conservation buffer of 1.90%). Quality of the capital is evident from Bank’s Common Equity Tier-1 (CET1) to total risk weighted assets ratio which comes to 16.02% against the requirement of 6.00%. Bank’s capitalization also resulted in a leverage ratio of 7.09% which is well above the regulatory limit of 3.0%. The Bank reported Liquidity Coverage Ratio (LCR) of 178.70% and Net Stable Funding Ratio (NSFR) of 130.6% against requirement of 100.
The Bank enjoys highest local credit ratings of AAA / A1+ categories for long term and short term respectively, based on PACRA notification dated June 27, 2018. Moreover, PACRA has maintained TFC rating of MCB Bank Limited at AAA, through its notification dated June 27, 2018.
The Board of Directors declared final cash dividend of Rs. 4.0 per share for the year ended December 31, 2018, which is in addition to Rs. 12.0 per share interim dividends already paid to shareholders.
JS Bank Wins CSR Award at 8th Annual CSR Summit
JS Bank, one of the fastest growing financial institutions of Pakistan has won the honorary CSR award at the 8th Corporate Social Responsibility Summit & Awards. This is the 7th year running that the Bank has been recognized for its grassroots focused community development initiatives.
The award was received by Zaid Haroon, Head of Corporate Communications and CSR for the Bank. JS Bank is working in the areas of health, education and sustainable development through its own efforts as well as by supporting the charitable arm of JS Group, Mahvash & Jahangir Siddiqui Foundation (MJSF).
Speaking at the occasion, Zaid Haroon stated, “JS Bank is at the forefront of positive social change as we believe in going beyond business. As the 3rd largest SME bank in the country, JS Bank believes in the entrepreneurial spirit of its fellow citizens and has partnered with organizations such as Karandaaz Pakistan, USAID etc. for SME financing. Passionate about operational sustainability we are the first commercial bank in South Asia to have been certified by WWF as a Green Office.”
The 8th Corporate Social Responsibility Summit & Awards 2019 was organized by The Professionals Network and Ethical Business Update EBU. The ceremony was held in Karachi and was attended by ac cross section of individuals from the corporate, academia, philanthropic and government sectors.
EBM continues to expand its export business
The increasingly positive response from buyers at the Gulfood 2019 Exhibition held in Dubai from 17th to 21st February has created numerous opportunities for EBM to increase business in international markets.
The company has already enhanced its operational capability to meet the level of demand that exists outside local consumption; a development which has enabled the organization to export its products to more than 25 countries around the world, including USA, Europe, and the GCC region.
“We have brought EBM at par with international quality standards and intend on making it a recognized brand around the world. We holistically envision a brand name that is synonymous with quality, trust, and nourishment for our consumers around the world,” said Dr. Zeelaf Munir, Managing Director & CEO, EBM.
EBM surfaced as the first Pakistani company to make its mark on key fronts at this exhibition, thus enabling the company’s goals of being highlighted on the global stage. The exhibition has, so far, served as a platform for EBM’s quest for continuous expansion at the international level, thereby adding to the company’s already established fame on the local front.
Gulfood Exhibition, which was held at the Dubai World Trade Center, attracted exhibitors from all continents and engaged over 100,000 buyers from 120 countries where key trends and topics driving the industry were discussed among industry leaders.
Potential buyers gave a phenomenal response to EBM during the 5-day exhibition. EBM’s commitment to keep abreast of global trends, while remaining true to its roots, has enabled the company to satiate the needs of local and international consumers from diverse markets.
Carfirst launches merchant program to help auto industry entrepreneurs
CarFirst, Pakistan’s leading online auction and trading platform for used car, launched its Merchant Program to help grow the number of entrepreneurs in Pakistan’s Auto Industry. CarFirst’s Merchant Program is a new initiative to assist auto brokers, investors, and agents to rapidly scale up their business and increase volumes by joining the CarFirst partner network. CarFirst’s aims also to help local auto-entrepreneurs, individuals who want to start a sustainable business in the automobile industry, who are looking to increase the scalability of their business.
CarFirst’s Merchant Program is open to any individual with the passion and skills for car trading, and the ambition to grow their business fast. Interested Auto entrepreneurs can fill out a simple online application, submit documentation and claim their place in Pakistan’s largest network for used car trading. Each CarFirst Merchant will have access to PKR 6 Mln of instant credit for purchases, access to a daily inventory of hundreds of fully inspected and certified cars with pre-checked paperwork. As part of the CarFirst’s partner network, they will also receive access to our online auction platform, subsidized OLX featured listings, latest market intelligence, and a range of value-added services like financing, warranty, insurance, et al.
Commenting on the launch of the Merchant program, Pervaiz Khan, Head of Dealer Management at CarFirst said, “CarFirst’s Merchant Program is the way forward for new auto industry entrants looking to grow the size of their business in Pakistan. We provide auto industry entrepreneurs instant credit on purchases of up to PKR 6 Mln, access to hundreds of fully inspected and certified cars with pre-checked paperwork, market intelligence systems, latest market prices, trends, and access an online auction platform. CarFirst will also help these future dealers increase the sales volume and profitability of their business, by offering them access to OLX paid listings, value-added services such as financing, warranty, and insurance. We welcome men and women looking to become auto-entrepreneurs, existing small-medium sized auto merchants, investors, importers, agents, or brokers to join the CarFirst Merchant Program and be part of our vision to revolutionize the Pakistan Auto Sector”
CarFirst is a first of its kind used-car online auction and trading platform, with a nationwide network of purchase centers and warehouses. CarFirst was founded in 2016 and has been the recipient of the largest Series ’A’ investment in Pakistan from Frontier Car Group, and the largest Series ’B’ investment from OLX Group. CarFirst aims to revolutionize the way cars are traded in Pakistan by offering comprehensive solutions for all things related to cars, such as evaluation, certification, financing, insurance, live auctions, and many more. CarFirst aim is to keep adding value across the customer’s journey, improving efficiency and transparency at every milestone of the car trading process.
Bank Alfalah Records over Rs.10 billion and a Positive Operating Leverage in 2018!
The Board of Directors of Bank Alfalah in their meeting held in Abu Dhabi on 21st February 2019, approved the Bank’s audited financial statements for the year ended December 31st 2018.
The Bank recorded profit after taxation of Rs.10.625 billion, for the year ended December 31st 2018, higher by 27% in comparison to 2017.
The performance was largely driven by growth in its core business operations with revenue growth of 9.8% and operating expenses reduction by 2.4% versus last year. Net interest income grew by 9.0%, or Rs.2.615 billion, totaling Rs.31.591 billion, as a result of earning asset growth and better spreads. The Bank was able to overcome the pressure on net interest income (NII) due to the maturities of high yielding bonds and lagged re-pricing impact of asset book in rising interest rate scenario. The cost of deposits increased by 40 bps as compared to corresponding period last year, despite the policy rate increase of 425 bps over the course of the period.
Non Fund Based Income growth was supported by foreign exchange gains which increased significantly by Rs.726 million, or 50%, as a result of exchange rate volatility, over the period, which were capitalized by the Bank. Fees and commission income was reported at 6.292 billion, improving by 5 per cent year on year. Net gains on securities, mainly from government securities and equities, reported at Rs.993 million, declined by 13% mainly due to bearish capital market sentiments.
Despite taking an impact of branch expansion and investment in IT infrastructure, digital channels, deposit protection premium along with inflationary adjustments and PKR devaluation at the latter part of the year total operating expenses were reported at Rs.24.365 billion as against to Rs.24.964 billion last year, declining by 2.4%. This is reflective of a strict culture of cost discipline which has been enforced across the bank and payback of restructuring done. Excluding the one-offs in 2017 and 2018, the operating expenses remained flat.
The bank’s profit from discontinuing operation has increased from Rs.201 million to 475 million and includes reversal of provision amounting to Rs.444 million (USD 3.949 million), previously held against amount blocked in the Bank’s Nostro account following settlement of dispute, and release of funds in favour of the Bank.
The NPL ratio has improved to 3.6% as compared to 4.2% last year, and continues to remain one of the lowest infection ratios in the industry. As at December 2018, the Bank’s provision coverage stands at 84.4%. These ratios incorporate the impact of subjective provisioning taken by the bank based on prudence.
Deposits increased by 9.0%, ending at Rs.703 Billion. The Bank’s CASA mix is 77.2%. At the year end, gross advances to deposits ratio stands at 73.8%, and remains a leading indicator and shows Bank’s commitment towards private sector. The Bank remains adequately capitalized, with Capital Adequacy Ratio at December 2018, being 14.95%.
The Directors have recommended final payment of Cash dividend of Rs.1.50 per share (15 %) for the year ended December 31, 2018, subject to approval of the shareholders in the upcoming annual general meeting, bringing the total cash dividend for the year to Rs.2.50 per share. The Board had earlier declared and paid interim cash dividend of Rs.1.00 per share. The Board had also declared interim stock dividend of 10% i.e. 10 shares for every 100 shares held.
Commenting on the Bank’s performance over the year, Nauman Ansari, CEO, Bank Alfalah said, “We are pleased with the overall consistent performance of the Bank, especially from the core business operations, which reflects our commitment to do things differently, challenging the status quo to find new and better ways to move ourselves and our customers forward.”