As opposed to a gross profit of Rs38.8 million in January-March 2012, SSGC posted a gross loss of Rs1.3 billion, mainly because of higher cost of sales, which increased by 19.2% over the period. PHOTO: FILE
KARACHI:
Sui Southern Gas Company’s (SSGC) profit for the January-March 2013 period increased 5.3% to Rs593.9 million compared to the corresponding three-month period of the preceding fiscal year, according to a notice sent to the Karachi Stock Exchange on Friday.
While revenues of SSGC increased 2.9% to reach Rs40.6 billion, the company posted an operating loss of Rs1.6 billion in the second-last quarter of the current fiscal year. As opposed to a gross profit of Rs38.8 million in January-March 2012, SSGC posted a gross loss of Rs1.3 billion, mainly because of higher cost of sales, which increased by 19.2% over the period.
‘Other non-operating income’ saved the day for SSGC, which rose 43.6% to Rs4.5 billion, effectively preventing the gas utility from posting a net loss on a quarterly basis. While earnings per share (EPS) for the three-month period ending March 2013 was Rs0.67, up from Rs0.64 in the corresponding period in the preceding year, EPS for July 2012-March 2013 dropped from Rs2.39 in the corresponding period of the preceding fiscal year to Rs1.86. SSGC operates with a fixed rate of return (before financial charges and tax) of 17% per annum on the net average of its fixed operating assets under a tariff regime governed by the Oil and Gas Regulatory Authority (Ogra).
SSGC has said Ogra has taken the Sindh High Court’s stay order regarding an increase in unaccounted-for gas (UFG) ceiling into account while determining this tariff. The court has directed Ogra to treat the UFG benchmark as fixed at 7% for the remainder of the current fiscal year, and also to treat certain incomes as non-operating incomes till it provides a final decision on a petition filed by SSGC.
In case the petition is decided against the company, instead of declaring a profit, it would incur a loss of Rs5.8 billion for the period ended March 31, 2013. However, if the petition is decided in favour of the company and all contentions requested by the company are accepted, the net profit for the period would further increase by Rs3.7 billion, according to Company Secretary Yusuf J Ansari.
Published in The Express Tribune, April 27th, 2013.
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