AKD Securities Limited – Off the Analyst’s Desk

Karachi, April 12, 2019 (PPI-OT): APL: Result Review 3QFY19

Attock Petroleum Limited (APL) posted PAT of PkR284mn (EPS:2.86) for 3QFY19, down 80%YoY as volumes declined by 8.9%YoY while inventory losses on the back declining oil prices also played a part. According to our calculation, company incurred inventory losses of ~PkR1.3bn for 3QFY19 against our expectation of PkR750mn.

Sequentially, profit declined by 49%QoQ where higher inventory losses more than offset the gains from higher volumes. For 9MFY19, PAT clocked in at PkR2.4bn (EPS: 23.99), down 44%YoY as inventory losses and decreasing volumes weigh heavily on the profitability.

For 9MFY19, in-line the with the overall industry trend, APL experienced a dismal period where overall sales volumes of the company fell by 25%YoY with furnace oil taking the lead (down 48%YoY).

Looking ahead, growth from retail outlet and storage facilities are expected to supplement earnings in the medium term. Encouragingly, the company has held onto market share in an otherwise tepid demand environment and entrance of new players, where company’s overall market share improved by 2.44pts to 10.7% for 9MFY19.

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