APL: Inventory gains lift EPS by over 4.8x YoY

August 11, 2021 (MLN): Attock Petroleum Limited (APL), has disclosed its financial performance for FY21 wherein the company posted over 4.8x YoY increase in net profits to Rs4.9bn compared to Rs1bn in FY20.

This translated into earnings per share of the company which clocked in at Rs49.43 as against Rs10.13 in the previous fiscal year.

The surge in the profitability of the company was majorly due to a low base as FY20 saw a collapse in oil prices, which left enormous inventory losses for all existing players holding POL inventory in their storage.

Sales revenue of APL was declined by 6% YoY due to a decline in petroleum product prices and flat sales volume as MOGAS and HSD market shares dropped to 8.1% and 9.2%, respectively, vs. 8.9% and 9.6% in SLPY. The drop in the market share of HSD is mainly attributable to losing government contracts during FY21. Nevertheless, due to inventory gains on account of normalcy in oil prices from their depressed levels in FY20, gross profits of the company was surged by 174% YoY.

Moreover, due to a decline in short-term investment and interest rate, the finance income of the company dipped by 40%YoY, while finance cost also shrank by 11% YoY.

With regards to market share, APL witnessed a slump, standing at 8% for 4QFY21 against 9% for 4QFY20 as HSD consumption by power plants decreased while smaller players are also eating up the company's share in retail fuels. Nonetheless, the company has overcome its supply chain bottleneck and expanded its storage capacity by leaps & bounds to over twofold since 2017. This would help APL to regain its market share and expand its retail presence across the country.

Its upcoming Port Qasim storage terminal in Karachi is an indication that the company aims to move towards growth further in the southern region, striving to take an assertive position in Sindh’s major cities.

Alongside financial results, the company announced a dividend of Rs24.5/sh, i.e., 245% for FY21.

Looking ahead, the Company’s debt-free balance sheet will not only shield it from interest rate volatility, and assist company in taking new projects in the future, but this will also ensure strong dividend payouts.

Profit and Loss Account for the Year ended June 30, 2021 ('000 Rupees)

 

Jun-21

Jun-20

% Change

Sales

                  221,333,864

                  235,732,129

-6.11%

Sales tax and other govt levies

                  (32,688,489)

                  (34,653,409)

-5.67%

Net sales

                  188,645,375

                  201,078,720

-6.18%

Cost of products sold

                (178,663,434)

                (197,440,830)

-9.51%

Gross profit

                       9,981,941

                       3,637,890

174.39%

Other income

                       1,260,580

                           898,534

40.29%

Net impairment losses on financial assets

                           408,961

                        (373,948)

-209.36%

Operating expenses

                     (4,151,753)

                     (3,078,683)

34.85%

Operating Profit

                       7,499,729

                       1,083,793

591.99%

Finance income

                       1,333,519

                       2,231,703

-40.25%

Finance costs

                     (1,418,918)

                     (1,597,199)

-11.16%

Net finance income

                           (85,399)

                           634,504

Share of loss/profit of associated companies

                             33,553

                           (97,289)

-134.49%

Other charges

                        (508,825)

                        (117,922)

331.49%

Profit before taxation

                       6,939,058

                       1,503,086

361.65%

Provision for income tax

                     (2,019,426)

                        (494,792)

308.14%

Profit for the period

                       4,919,632

                       1,008,294

387.92%

Earnings per share – basic and diluted (Rupees)

                               49.43

                               10.13

387.96%

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Posted on: 2021-08-11T15:02:00+05:00

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