Corporate results: PSO profit rises 35% on volumetric sales

Earns Rs4.37b in Jul-Sept quarter against Rs3.25b last year

KARACHI: Pakistan State Oil’s (PSO) profit increased 35% to Rs4.37 billion in the quarter ended September 30 on the back of volumetric sales of petroleum products and gas, according to a bourse filing on Monday.

The company had earned a profit of Rs3.25 billion in the same quarter last year. Earnings per share stood at Rs16.11 in July-September 2016 compared to Rs11.97 in the same quarter last year.

“Volumetric sales, particularly of liquefied petroleum gas, liquefied natural gas and furnace oil, helped the company earn higher profit,” said Sheikh Imranul Haque, MD and CEO of PSO, in a telephone conversation.



“A decline in finance cost due to a substantial cut in interest rate by the State Bank over a period of time also helped realise higher earnings.” Finance cost fell 32% to Rs1.27 billion from Rs1.88 billion last year.

Brokerage houses said in their post-result comments that the earnings were in line with market expectation. However, PSO’s share price fell 0.50%, or Rs2.08, to Rs413.58 with a volume of 986,500 shares.

Umair Naseer, an analyst at Topline Securities, said total oil sales of the company rose 18% on a yearly basis to 3.7 million tons in the July-September quarter.

In rupee terms, net sales were up 4.5% to Rs193.51 billion.

The analyst added the strong growth in sales volume averted any negative impact from lower oil prices in the international market and supported sales of the company. “Oil prices were down 14% year on year in the July-September quarter,” he said.

“Consequently, gross profits were up 30% to Rs9.7 billion in 1QFY17. Alongside improved sales, lower inventory losses could also be a key driving factor, we believe.”

Published in The Express Tribune, October 25^th, 2016.

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