Hascol's net losses shrink by 90% in 1QCY21

By MG News | January 19, 2022 at 05:38 PM GMT+05:00

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January 19, 2022 (MLN): Hascol Petroleum Limited has managed to condense its net losses by 90% YoY to Rs936.5 million during quarter Jan-Mar 2021, compared to the huge loss of Rs9.47billion reported in the same quarter last year.

Despite a 45.5% decline in Hascol’s net revenues, the company was able to report positive gross profits on the back of a 50% drop in the cost of products.

The net revenue of the company stood at Rs19bn, compared to Rs35bn in 1QCY20. The decline in revenues was primarily due to lower sales volume amid lockdown imposed by the government to tackle the covid-19 situation during the period.

Drilling further, the company witnessed Rs664.6mn worth of exchange profit and a 36% YoY dip in financial charges, which kept a lid on further addition of the losses.

On the expense side, the distribution and marketing expense of the company remained relatively flat at Rs804mn. Meanwhile, the administrative expenses jumped by 27% during the quarter to stand at Rs272.6 million.

The company was hit hard by COVID-19 due to a collapse in demand. As a result, in 2021 the company entered into negotiations with its banks to comprehensively restructure and refinance its liabilities. The Company had been in detailed discussions with the major banks on the restructuring in close coordination with the Board.

To recall, Vitol, Hascol's major shareholder, increased its equity stake from 25% to 40% in order to support the company through this difficult period in 2020.

Consolidated Profit and Loss Account for the quarter ended March 30, 2021 ('000 Rupees)

	Mar-21	Mar-20	% Change
Sales - net	22,256,394	40,953,240	-45.65%
Sales tax	(3,242,415)	(6,045,622)	-46.37%
Net sales	19,013,979	34,907,618	-45.53%
Other revenue	76,559	130,063	-41.14%
Net revenue	19,090,538	35,037,681	-45.51%
Cost of products sold	(18,065,330)	(36,358,019)	-50.31%
Gross profit	1,025,208	(1,320,338)	-
Distribution and marketing	(803,866)	(802,033)	0.23%
Administrative	(272,583)	(213,539)	27.65%
Impairment losses on financial asset	-	(47)	-
Other expenses	(1,050)	(2,737,914)	-99.96%
Other income	163,372	144,102	13.37%
Operating (loss) / profit	111,081	(4,929,769)	-
Finance cost	(1,590,264)	(2,489,512)	-36.12%
Exchange loss - net	664,592	(1,854,941)	-
Share of profit from associates	(17,550)	16,491
(Loss) / Profit before taxation	(832,141)	(9,257,731)	-91.01%
Taxation	(104,421)	(215,695)	-51.59%
(Loss) / Profit for the period	(936,562)	(9,473,426)	-90.11%
(Loss) / Earnings per share - basic and diluted (Rupees)	(0.94)	(9.68)	-90.29%

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