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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