Pakistan Refinery Limited (PSX: PRL) posted a significant net loss of Rs2.35 billion for the quarter ended September 2024, translating to a loss per share (LPS) of Rs3.73. This marks a sharp decline from the profit of Rs4.48 billion [EPS: Rs7.11] recorded in the same quarter last year.
The loss was primarily driven by a 12.1% drop in sales, which decreased to Rs82.10 billion in Q3 CY24 compared to Rs93.37 billion in Q3 CY23. Despite the reduction in revenue, the company’s cost of sales only fell by 2.8%, amounting to Rs82.04 billion. This mismatch led to a 99.4% plunge in gross profit, which stood at just Rs56.35 million, down from Rs8.93 billion in the previous year.
Gross margins also deteriorated drastically, shrinking to a mere 0.1% from 9.6% in the same period last year (SPLY).
Other income decreased by 19.2%, dropping to Rs608.25 million from Rs752.29 million in Q3 CY23, further contributing to the weak financial performance. Meanwhile, selling expenses surged by 29.9% year-on-year (YoY) to Rs194.66 million, and administrative expenses rose sharply by 44.3% YoY to Rs398.95 million.
In addition, other operating expenses saw a substantial increase of 100.2%, doubling to Rs1.78 billion in Q3 CY24 from Rs890.98 million in the same period last year.
One bright spot was a 7.6% reduction in the company’s finance cost, which decreased to Rs826.89 million from Rs895.26 million in Q3 CY23. On the tax front, PRL received a tax credit of Rs187.88 million compared to the Rs2.99 billion paid in the same quarter last year.
Overall, the combination of declining sales and rising expenses resulted in a net loss of Rs2.35 billion for PRL in Q3 2024, a stark reversal from the profit achieved in Q3 2023.
Financial Snapshot (Q3 CY24 vs Q3 CY23):
- Sales: Rs82.10 billion (down 12.1% YoY)
- Cost of Sales: Rs82.04 billion (down 2.8% YoY)
- Gross Profit: Rs56.35 million (down 99.4% YoY)
- Selling Expenses: Rs194.66 million (up 29.9% YoY)
- Administrative Expenses: Rs398.95 million (up 44.3% YoY)
- Other Income: Rs608.25 million (down 19.2% YoY)
- Other Operating Expenses: Rs1.78 billion (up 100.2% YoY)
- Finance Cost: Rs826.89 million (down 7.6% YoY)
- Net Loss: Rs2.35 billion (compared to a profit of Rs4.48 billion YoY)
- Earnings / Loss Per Share: Rs(3.73) compared to Rs7.11
