Pakistan State Oil (PSO), the largest oil marketing company in Pakistan, has announced its financial results for the Q1 2019-20.
PSO reported a profit of Rs. 3.53 billion, down by 15.55% as compared to a profit of Rs. 4.18 billion earned in the same quarter last year. The major reason for the reduction in profits was a significant increase in finance cost on account of higher discount rates set by the State Bank of Pakistan.
The company witnessed a 17.5% increase in sales, reaching Rs. 329 billion in Q1 2019 due to a surge in petrol prices and an increase in sales volumes as compared to Rs. 280 billion sales in the the same period last year. Despite stiff competition, PSO continued to lead the downstream oil market with an increased overall market share of 46.6% as compared to 40.1% last year.
The finance cost increased 44.51% to Rs. 2.63 billion due to higher reliance on short-term borrowings as compared to Rs. 1.82 billion for Q1 last year. Other income increased by nearly 63% to Rs. 1.58 billion in the period under review from Rs. 970 million. The jump was due to higher mark-up on delayed payments.
During the quarter, PSO’s receivables from the power sector decreased by Rs. 8.9 billion whereas receivables from Sui Northern Gas Pipelines Ltd increased by Rs. 2.4 billion. Earnings per share of the company decreased to Rs. 9.02 from Rs. 10.69.