Pakistan State Oil Company Limited (PSO) announced its financial result for 9MFY19 whereby the company declared a Profit After Tax (PAT) of PKR 5.93bn (EPS: PKR 15.15) compared to PKR 13.23bn (EPS: PKR 33.80) in 9MFY18, depicting a decline of 55% YoY.
On a sequential basis, earnings clocked-in at PKR 1,677mn (EPS: PKR 4.29), down by 64% YoY while up by 24x QoQ.
Along with the result, the company announced a cash dividend of PKR 5.00/share compared to PKR 10.00/share in SPLY.
Topline of the company settled at PKR 247bn during 3QFY19, up by 9% YoY compared to PKR 226bn in 3QFY18.
Despite decline in volumes, sales increased on account of higher prices of petroleum products. During 3QFY19, total volumetric sales plunged by 14% YoY and 1% QoQ (FO and HSD sales dropped by 26% YoY / 3% QoQ and 17% YoY / 11% QoQ) to 1.80mn metric tons.
The company posted a gross profit of PKR 7.89bn whereby gross margins arrived at 3.20% in 3QFY19 compared to 4.50% in the prior year.
Given noteworthy fluctuation in ex-refinery prices, we estimate an inventory loss of PKR 1.0bn was recognized during the quarter.
Other operating income decreased by 55% YoY and 44% QoQ to PKR 942mn. We reckon that decline in other income is on the back of lower markup on delayed payments in the period under review.
Meanwhile, increase in finance costs by 53% YoY and 44% QoQ to PKR 2,920mn is owed to higher reliance on borrowing to meet working capital requirements.
The company booked effective taxation at 52% (1% W.H.T on sale of RLNG) in contrast to 36% in 3QFY18.