Pakistan State Oil Limited (PSO) is scheduled to announce its 3QFY19 result on 19th Apr’19. During 9MFY19, analysts estimate the company to report a PAT of PKR 5.67bn (EPS: PKR 14.48), down by 57% YoY compared to PKR 13.2bn (EPS: PKR 33.80).
This drastic drop in earnings is due to decline in sales volumes of FO and HSD by 73% YoY and 30% YoY along with significant inventory losses and higher finance costs.
On a sequential basis, earnings may clock-in at PKR 1,415mn (EPS: PKR 3.62), significantly down by 70% YoY compared to PKR 4,703mn (EPS: PKR 12.02).
This decline is attributable to massive decline in furnace oil sales by 26% YoY to 0.32mn tons compared to 0.44mn tons in SPLY, HSD sales decreased by 17% YoY owing to intense competition from other oil marketing companies and improvement in electricity generation resulting in lack of demand from captive power generation, increase in finance costs by 56% YoY to PKR 2,972mn on account of increase in borrowings to meet working capital requirements, and expected inventory loss of PKR 1.8bn during 3QFY19 due to change in ex-refinery prices.