Sri Lanka’s LIOC profits grow with cheap oil, pricing formula

ECONOMYNEXT- The Sri Lanka unit of the Indian Oil Company said its net profits were 938 million rupees in the March 2019 quarter, up from a 92 million rupee loss from a year, with lower oil prices making up for lower sales.

Lanka IOC’s (LIOC) basic earnings per share were 1.76 rupees, while the firm’s share was 40 cents higher at 17.80 rupees in intra-day trading on Wednesday.
Revenue for the March quarter was 18.5 billion rupees, down 22.2 percent from a year earlier, while cost of sales fell 28 percent to 23.8 billion rupees, leading to gross profits of 1.4 billion rupees, up 258.3 percent.
During the March quarter, a price-reflective formula was in place, compared to a year earlier, when the government was implementing fixed prices.
Oil prices had plunged in November and December 2018 after the US said it would not impose sanctions against Iran trading oil, and prices had remained below the previous year in the months since.
Meanwhile, LIOC’s finance income fell 50.3 percent to 125.9 million rupees while finance cost fell 80.8 percent to 29 million rupees.
The firm’s borrowings as at March 31, 2019 fell to 2.3 billion rupees from 5 billion rupees a  year earlier.
Its assets fell to 28.2 billion rupees from 32.9 billion rupees with the unwinding of short-term investments, although the firm was seen stockpiling low-priced oil. (Colombo/May09/2019-SB)

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