Lanka IOC back in profits after raising fuel prices
ECONOMYNEXT- Sri Lanka unit of India Oil Company, Lanka IOC Plc, returned to the black with a net profit of 207.3 million rupees in the September 2018 quarter, up from a loss of 176.9 million rupees a year earlier, after it was allowed to raise fuel prices, amidst sharp cost cuts, interim accounts showed.
It reported earnings of 39 cents for the quarter in the quarter. Earnings for the first six months to end September were 85 cents a share on a profit of 453.2 million rupees, up from a loss of 312.1 million rupees a year earlier.
Lanka IOC fell 20 cents to 27.10 rupees on Monday.
Revenue for the September quarter grew 2.1 percent from a year earlier to 25.6 billion rupees, cost of sales fell 1 percent to 24 billion rupees leading to gross profits doubling to 1.5 billion rupees.
In May, the government put in place a formula that would change local fuel prices based on global oil price movements every month.
Selling and distribution expense fell 22.8 percent to 580.2 million rupees from a year earlier, while administrative expenses were down 29.3 percent to 364.2 million rupees.
Finance costs increased over tenfold to 546.2 million rupees from 48 million rupees a year earlier.
Lanka IOC’s assets grew to 40.3 billion rupees from 33 billion rupees at the start of the financial year with increased inventories.
Borrowings, all short-term, increased to 7.1 billion rupees in September from 5 billion rupees in March. (COLOMBO, 29 October 2018)