Lanka IOC records stellar performance in 1Q

6 August 2022 12:57 am - 9 - {{hitsCtrl.values.hits}}

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Despite the operational challenges stemming from forex crisis, inflation and higher global oil prices, Lanka IOC PLC reported robust performance for the quarter ended June 30, 2022 (1Q23) with significant growth in revenue and profits.

The company said its revenue increased by 196 percent year-on-year (YoY) to Rs.49.93 billion. The Sales volume of the company also increased to 139,762 MT from 135,354 MT on YoY basis.

The cost of sales for the quarter was Rs.34.4 billion compared to Rs.16 billion a year ago as a result of the steep rise in international oil prices.

The company reported earnings of Rs.18.64 per share for the quarter under review on net profit of Rs.9.93 billion compared to earnings of 51 cents a share or Rs.273 million in the corresponding quarter of the previous year.
However, Lanka IOC said the sudden devaluation of currency from Rs.299 to Rs.367 per US$ coupled with extremely high borrowing costs, raised its finance expenses during the quarter to Rs.1.79 billion as against Rs.123 million a year ago.

“The company ventured into a new line of business of selling diesel directly to export houses, tourism services providers registered under Sri Lanka Tourism Development Authority, licensed telecommunication service providers and power generation companies, against remittance in US dollars. The collection in US$ eliminated the exchange rate risk and allowed sale of fuel to industries at a predetermined price,” Lanka IOC Managing Director Majoj Gupta said.

“On the other hand, it met the essential fuel requirement of innumerable industries which are responsible for livelihoods of millions of employees and their dependent family members. It is beyond imagination to believe the repercussion in case fuel requirements were not met on time.

I am so indebted to my workforce at Trincomalee Terminal who have had round the clock operation of the terminal for more than 3 weeks with limited resources to supply fuel not only to industries but also to ensure supply of 7500 MT of diesel to CPC for onward dispatches for essential services,” he added.

Gupta also said the company’s bunkering business has registered exceptional performance, amid the exchange gain in view of depreciation of the currency, as sales take place in US$.
He further said the revision in retail prices (RSP) for auto-fuel in line with the pricing formula has been beneficial for the company.

“RSP revisions played a crucial role in circumventing the price volatility in the international oil market to a large extent. The bottom-line of the company has also been transformed by exceptional performances by Lubricants, Petrochemicals and Bitumen. We are extremely grateful to CBSL authorities and Ministry of Power and Energy, GoSL for their continuous support,” Gupta said.

Comments - 9

Almon Saturday, 06 August 2022 07:18 AM

If IOC makes such huge profits then why is CPC making massive losses? Something is really rotten. It has been prove that CPC employees were taking large overtime payments even during Jun/Jul when there were hardly any shipments reaching Sri Lanka and no distribution of fuel. Successive governments have given jobs to their supporters and overstaffed CPC. Purchasing of fuel is full of corruption and underhand deals. Institutions like CPC, CEB, Sri Lankan Airlines drag the economy to its knees.time to private these loss making SOE's urgently to stop the bleeding

Marie Saturday, 06 August 2022 08:07 AM

LIOC reporting a robust performance and CEYPETCO reporting colossal losses. Aragalaya Youth, a crying situation for a “system change”. Take up the challenge.

Covey Saturday, 06 August 2022 08:08 AM

It shows that IOC is making good profit with efficient operations while CPC is making a huge losses with inefficient and corrupted operations. cPC need to be privatized soon

Redundant Saturday, 06 August 2022 08:09 AM

The great invention CPC sell same products and same price, yet it cannot break even, leave alone making huge profits. Does it indicate a significant feature which is a well known secret. Look into the percentage of staff expenses, and you are the winner. Does the CPC carry redundant staff? Are they henchmen accumulated after each election by winning political parties? You hit the jackpot!

maha Saturday, 06 August 2022 08:29 AM

IOC makes consecutive profit while CPC make losses in the same market, selling at fix prices. The Loss has to bear by the public being CPC Govt entity. Why people in this country against privatization ?

Tissa Fernando Saturday, 06 August 2022 10:07 AM

This means thst they are selling the fuel with very high margins. Big mistake to give thus to another country.

LUCKY Saturday, 06 August 2022 10:21 AM

This is the perennial problem with all our Govt/ Corporation/Boards etc that drags our economy down. No work done, strike at the drop of a pin, highly overstaffed with lotus eaters, paid salaries and bonus when operating at a loss, and all are happy until a crises exposes it all. You can't blame the call for a system change !

tilak Saturday, 06 August 2022 11:36 AM

This is the reason all loss making state institutions like, CEB, CPC, Sri Lankan Airlines etc should be privatized.

DGee Saturday, 06 August 2022 12:19 PM

IOC makes such big profits but CPC at loss because of costs on idling refinery, costs of big labor force and other wasteful expenses due to politicization etc. Minister should get independent expert group to study to see how CPC can be made profitable.

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Lanka IOC records stellar performance in 1Q

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