Pakistan Refinery results
August 22, 2006An informative article of Pakistan Refinery’s results today and the outlook for next year from Bloomberg.
By Haris Zamir
Aug. 22 (Bloomberg) — Pakistan Refinery Ltd., the nation’s third-largest oil processor, posted a 22 percent decline in full-year profit because inventory gains fell. Net income decreased to 1.34 billion rupees ($22.5 million),or 53.80 rupees a share, in the 12 months ended June 30, from 1.72 billion rupees, or 69 rupees, a year earlier, the Karachi-based refiner said today in a statement to the stock exchange.Sales increased 37 percent to 60.96 billion rupees. The company is expected to report a further 5 percent fall in profit in 2007 before the declining trend is reversed, said
Mohammad Fawad Khan, a research analyst at KASB Securities who had forecast full-year profit at 1.36 billion rupees, or 54.60 rupees a share.
Pakistan Refinery’s shares, which have fallen 17 percent this year, declined 5 percent to 308.70 rupees on the Karachi Stock Exchange at 1:19 p.m. local time after the earnings announcement. The company plans to issue one share for every five held for the year ended June 30, it said. In the year ended June 30, 2005, the company paid a full-year cash dividend of four rupees a share.
In the year ending June 30, 2007, profit will decline because of a month-long plant shutdown in August for routine maintenance,Khan said. From 2008, the refiner will benefit from a supply deficit in the industry, which will keep capacity utilization above 90 percent, Khan said in a report released on Aug. 7.
"Pakistan Refinery enjoys strong operating efficiencies in the form of low processing cost and well-controlled production
losses,'’ Khan said. Crude oil for September was at $72.46 a barrel, up 1 cent, in after-hours electronic trading on the New York Mercantile Exchange at 10:16 a.m. in Singapore. Prices today are 11 percent higher than a year ago.
Pakistan Refinery is ranked second by return on equity among 12 Asian refiners by Merrill Lynch & Co., after Thailand’s PTT Pcl, a state-controlled oil and gas company. Pakistan Refinery’s return on equity is 31.1 percent, higher than the Asian average of 20.58 percent, Merrill Lynch, which has a "buy'’ recommendation on the stock, said in a report released on Aug.4. Pakistan’s cost of importing oil increased 67 percent to $6.66 billion in the year ended June 30, the Federal Bureau of Statistics in Islamabad said in a statement last month. Pakistan imports about 85 percent of the oil it uses.
