The Attock Petroleum Limited (PSX: APL) is engaged in the downstream petroleum business of the country, and is part of the only integrated oil and gas group in the country - Attock Oil Group. It was incorporated in 1998.

The firm's product portfolio consists of lubricants, commercial and industrial fuels. In the fuel category, the OMC markets and supplies fuels to manufacturing industry, armed forces, power producers, government/semi-government entities, FMCG companies, developmental sector, agricultural customers etc. APL's key commercial and industrial fuels marketed include: high speed diesel, motor spirit, jet fuel, kerosene oil, asphalt, furnace oil, light diesel oil and lubricants. In the lubricants category, the company offers a range of lubricants which include both automotive and industrial grades blended with base oils and additives.

APL has a huge storage, transportation & retail outlet network. Apart from facilitating export of naphtha to the Middle East, Far East and South Asia, APL also exports petroleum products to the neighbouring country Afghanistan.

Past Performance

The imposition of certain restrictions on the export of petroleum products to Afghanistan in FY13 was one of the key reasons that affected the profitability of the oil marketing companies in terms of foreign exchange earnings. FY13 saw only a three percent increase in overall petroleum trade in the country. The muted sale volumes came mostly from the decrease in furnace oil despite the rising motor spirit (petrol) volumes.

In the same year, APL witnessed a commendable growth in the number of retail outlet during FY13 with 52 new outlets. The core revenues of the oil marketing company moved up by eight percent year-on-year, but the earnings were eaten by overrun in administrative expenses and finance cost.
APL's bottom line diluted in FY13 due to higher operating expenses and unlike the gross margins that improved slightly year on year, the net margin tanked. Overall in FY13, company's earnings contracted by five percent, year-on-year. In FY14, the industry was able to increase its sales volumes by nine percent year-on-year. APL was able to increase its market share from 9.3 percent in FY13 to 10.1 percent in FY14 due to its better product sales growing by 19 percent year-on-year in FY14.

Largely driven by retail volumes growth, the oil marketing sector was in the limelight in FY14 after the improvement in the liquidity and rising petroleum product consumption in the country. From the financial perspective, FY14 was a modest year for the firm. Firm's net revenue rose by an impressive 25 percent in FY14 versus FY13, which was due to increase in volumes sold, and a jump in international oil prices.