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Shell Pakistan swings to profits in Q1

April 22, 2021 (MLN): Shell Pakistan Limited (SHEL) returned to profitability in the first quarter ended March 31, 2021, gaining Rs 1.95 billion in net profits (EPS: Rs 11.17), against losses of Rs 4.33 billion (LPS: Rs 28.03) in the same period a year earlier.

The move to profits was helped by a 22% YoY rise in the net sales due to 26% higher volumes which were distorted by the COVID-19 outbreak in the same period last year, wrote Muhammad Saad Ali, Head of research at Intermarket Securities (IMS). As a result, the gross profits of the company surged by 5.34x YoY to Rs 3.99 billion during the said period.

The company’s earnings were further strengthened by a decrease in other expenses as they came down by 92.6% YoY to Rs 124 million.

Other income of Rs 1.4 billion points to exchange gains, in line with IMS estimate. This emanates from a 5% PKR appreciation against the USD. The research highlighted that without these gains (Rs 4.6 per share after-tax), the headline EPS would be at least half the actual result.

As per the financial statement issued by the company, the other positive highlights include a 36.6% YoY decrease in finance cost.

Meanwhile, the effective tax rate came down by 10% YoY to Rs 212 million during 1QCY21.

Financial Results for the quarter ended March 31, 2021 ('000 Rupees)

 

Mar-21

Mar-20

% Change

Sales

 60,346,721

 49,309,716

22.38%

Other revenue

 186,292

 104,724

77.89%

Sales tax

 (9,290,051)

 (7,504,663)

23.79%

Net revenue

 51,242,962

 41,909,777

22.27%

Cost of products sold

 (47,254,277)

 (41,163,967)

14.80%

Gross profit

 3,988,685

 745,810

434.81%

Distribution and marketing expenses

 (1,724,745)

 (1,747,045)

-1.28%

Administrative expenses

 (1,313,529)

 (1,315,789)

-0.17%

Other expenses

 (124,093)

 (1,667,284)

-92.56%

Other income

 1,423,753

 72,784

1856.13%

Operating profit/(loss)

 2,250,071

 (3,911,524)

Finance costs

 (274,263)

 (432,451)

-36.58%

Share of profit of associates – net of tax

 185,267

 248,228

-25.36%

Profit /(loss) before taxation

 2,161,075

 (4,095,747)

Taxation

 (212,638)

 (236,715)

-10.17%

Profit/ (loss) for the period

 1,948,437

 (4,332,462)

Earnings/(loss) per share – basic and diluted (Rupees)

 11.17

 (28.03)

 

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Posted on: 2021-04-22T13:25:00+05:00

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