The refinery segment saw a respite towards the end of FY15 in shape of improving currency stability and gross refining margins and spreads. Improvement in GRMs is the key in a refinerys financial performance.
However, the improvement was cut short in the first three months of FY16 due to currency depreciation, sliding crude oil price, and falling margins.
The performance of Attock Refinery Limited (PSX:ATRL) in 1QFY16 was highlighted by its non-refinery operations; the refinery displayed a decline of about 50 percent year-on-year in its revenues due to falling prices, and the refinery was also able to lessen the losses for the period.. The performance of National Refinery Limited (PSX: NRL) in 1QFY16 was better than ATRL as the refinery finally entered into positive zone.
In 2QFY16 the market was expecting no surprises from the refineries of Attock group along with extension of losses in the coming quarters.
But it would not be wrong to say that both the refineries rebounded to decent significant earnings improvements despite a decrease in top line.
ATRL was able to post an EPS of Rs12.07 per share in 1HFY16 against loss per share of Rs6.46 in 1HFY15, while NRL was able to put forth an EPS of Rs37.07 in 1HFY16 versus loss per share of Rs0.61.
The refineries look forward to the materialisation of their expansion and up-gradation plans, particularly that of Attock Refinery Limited, which include enhancement of crude oil processing capacity, captive power plant generation capacity, and installation of Naphtha Isomerization Unit and Diesel Hydro desulphurization Unit.
Comments
Comments are closed.