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Last Updated : 2024-04-23 22:35:00
Chevron Lubricants Lanka PLC, the local unit of US-based multinational, posted a net profit of Rs.525.90 million for its second quarter ended June 30, 2017 (2Q17), recording a 34 percent decline compared to the corresponding period last year, due to lower sales.
Earnings per share (EPS) for the quarter fell to Rs.2.19 from Rs. 3.34 year-on-year (YoY).
Revenue was down 19 percent YoY to Rs.2.28 billion, while cost of sales was kept down to Rs.1.26 billion, a decline of 16 percent YoY. Operating profits fell 32 percent YoY to Rs.701.20 million.
This is the third quarter in a row where Chevron Lanka reported depressed profits.
It appears that the slowing down of vehicle imports, the liberalization of the lubricant sector and intense competition in the marketplace are taking dent on the company’s top and
bottom lines.
Sri Lanka’s lube market is said to be Rs.24 billion in size and Chevron Lanka is said to be controlling little over 40 percent of the market. With the liberalization of the sector last year, a lot of new players, small in scale, have entered the market. Meanwhile, the total assets of the firm were Rs.5.49 billion as at June 31, compared to Rs.7.05 billion at the start of the financial year 6 months ago, due to a fall in cash and cash equivalents. In return, a significant portion of trade and other payables were settled.
Net assets per share increased to Rs.16.20 compared to Rs. 16.09 within this time frame as well. For the first half of 2017, Chevron’s net profit fell 25 percent YoY to Rs.1.35 billion. EPS deteriorated to Rs.5.62 from Rs.7.45.
Revenue for the 6 months fell 9 percent YoY to Rs.5.40 billion, while cost of sales fell 4 percent YoY to Rs. 2.97 billion.
Chevron Ceylon Limited owns 51 percent of the shares in the firm, with the rest of the shares distributed widely among minority shareholders.
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