Byco Petroleum Reports Gross Profit of Rs 1.7 Billion For 1Q18, Despite Challenging Environment
• Increase in international oil prices and Pakistani rupee’s depreciation pushed quarterly profit lower to Rs 0.07 per share.
• The Isomerisation unit was successfully placed into service in the current quarter and is contributing positively to the company’s profitability.
Karachi: Pakistan’s leading Oil Refining Company, Byco Petroleum Pakistan Ltd. (BPPL) today announced results for its first quarter ended September 30, 2018. The company’s gross sales increased by 61% to Rs 66.4 billion from Rs 41.4 billion in the same quarter last year. The net turnover increased by 71% to Rs 53.7 billion from Rs 31.4 billion a year earlier. However, this growth was largely driven by higher crude oil prices and an increase in the value of the U.S. dollar against the Pakistani rupee.
Byco Petroleum generated a gross profit of Rs 1.7 billion in the first quarter of 2018, down from a profit of Rs 2.3 billion in the first quarter of 2017. The operating profit was Rs 1.3 billion as compared to Rs 1.9 billion in the year-ago quarter. The net profit for the second quarter was Rs 397 million, or Rs 0.07 per share, down from a profit of Rs 1.2 billion, or Rs 0.23 per share, in the corresponding period last year. The dip in earnings was due to the tough market conditions in Pakistan’s oil refining sector witnessed in the first quarter. The 4% increase in the international crude oil prices and 6% decline in the value of the Pakistani rupee had a negative impact on Byco Petroleum’s gross refining margins (GRMs) and profits. Furthermore, the consumption of High Speed Diesel (HSD) also remained considerably weak in August 2018 which pushed the company’s throughput volumes lower.
Byco Petroleum is optimistic about the company’s future, particularly as the Isomerisation unit has been placed into service. The operations of the Isomerisation unit, which converts Naphtha into Premium Motor Gasoline, commenced in the current quarter by Byco Isomerisation Pakistan (Private) Limited, which is a wholly owned subsidiary of BPPL. The successful commissioning of the Isomerisation unit will have a positive impact on Byco’s refining margins.
Although Byco Petroleum is not immune to the industry-wide challenges, the company has much more to accomplish and is confident in its ability to create value for its shareholders, customers, and all other stakeholders.
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