Lower taxes reverse decline in PRL’s pre-tax profits

MG News | October 23, 2020 at 03:44 PM GMT+05:00

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October 23, 2020 (MLN): Pakistan Refinery Limited (PRL) has posted net profits of Rs 281 million in 1QFY21, depicting a rise of 55% YoY. However, its pre-tax profits suffered an 8.61% decline as compared to the corresponding period of last year.

This has translated into earnings per share which clocked in at Rs 0.49 against the earnings per share of Rs 0.42 in the aforementioned period.

According to the financial results issued to PSX, PRL witnessed a 50.57% YoY decline in topline which was attributable to asymmetrical changes in international prices of crude, resulting in a reduction of gross profits by 12% YoY to Rs 881 million despite a 52% decrease in the cost of sales.

Moreover, an increase in administration and other operating expenses by 11% and 6%, YoY, respectively also contributed to weakening the financial stability of the refinery.

The major highlight is a 51% YoY decrease in taxes which reversed a decline in the refinery’s profits during 1QFY21.

Profit and Loss Account for the quarter ended September 30th, 2020 ('000 Rupees)
	Sep-20	Sep-19	% Change
Revenue from contracts with customers	17,658,857	35,721,442	-50.57%
Cost of sales	(16,777,655)	(34,719,052)	-51.68%
Gross profit	881,202	1,002,390	-12.09%
Distribution cost	(53,416)	(66,534)	-19.72%
Administrative expenses	(99,483)	(89,968)	10.58%
Other operating expenses	(37,147)	(34,970)	6.23%
Other income	33,955	97,338	-65.12%
Operating profit	725,111	908,256	-20.16%
Finance cost	(309,789)	(453,801)	-31.73%
Profit before taxation	415,322	454,455	-8.61%
Taxation	(133,484)	(273,141)	-51.13%
Profit after taxation	281,838	181,314	55.44%
Earnings per share - basic and diluted (rupees)	0.49	0.42	16.67%

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