PRL suffers severe loss amid dropping revenue, rising expenses

October 18, 2024 (MLN): Pakistan Refinery Limited (PSX: PRL) suffered a substantial loss of Rs2.35 billion [LPS: Rs3.73] for the quarter ended September 2024, compared to a positive bottom line of Rs4.48bn [EPS: Rs7.11] reported in the same quarter last year.

According to the profit and loss account, the loss is attributed to a 12.1% drop in sales.

Furthermore, the cost of sales did not decrease by an equivalent amount compared to sales, which worsened the gross profit by 99.4%, resulting in a gross profit of Rs56.35m.

The gross margins worsened to 0.1% as compared to 9.6% in SPLY.

During the review period, PRL experienced an additional setback, with other income contracting by 19.2% to Rs608.25m in Q3 CY24, down from Rs752.29m in the SPLY.

On the expense side, the company's selling expenses rose 29.9% YoY to Rs194.66m, while administrative expenses surged 44.3% YoY to Rs398.95m.

Likewise, other operating expenses spiked 100.2% YoY to Rs1.78bn.

The company’s finance cost marked a decline of 7.6% and stood at Rs826.89m as compared to Rs895.26m in SPLY.

On the tax front, the company received a tax credit worth Rs187.88m against the Rs2.99bn paid in the corresponding period of last year.

To sum up, declining sales combined with a significant increase in operating expenses weighed heavily on the company this quarter, resulting in a severe loss.

Amount in thousand except for EPS

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