Qudsia Bano

Pakistan Refinery Limited (PRL) reported a remarkable 28% year-on-year (YoY) growth in its revenue for the third quarter of 2023 (3QCY23). The company earned Rs93.37 billion, up from Rs73.11 billion in the same period last year. This shows PRL’s strong performance and market position. The gross profit of PRL witnessed an outstanding increase, reaching Rs8.93 billion, a staggering 457% YoY growth from Rs1.61 billion in the third quarter of 2022. This substantial surge in gross profit underscores the company's efficiency in managing costs and optimising its production processes, contributing significantly to its overall financial health. Additionally, PRL reported other income of Rs752 million, reflecting a 6% YoY growth from Rs710 million in the corresponding quarter of the previous year. This diverse income stream indicates the company's ability to generate revenue from various sources, further strengthening its financial resilience. The pre-tax profit for the third quarter of 2023 stood at an impressive Rs7.47 billion, demonstrating a remarkable 482% YoY increase compared to Rs1.28 billion in the third quarter of 2022.

This significant surge in profit-before-taxation underscores PRL's strategic decision-making and effective financial management, positioning the company for sustained success in a dynamic market environment. The after-tax profit for the same period saw a substantial increase, reaching Rs4.48 billion, marking a commendable 336% YoY growth from Rs1.03 billion in the corresponding quarter last year. This surge in profitability is indicative of PRL's ability to navigate challenges and capitalise on market opportunities effectively. The earnings per share (EPS) for 3QCY23 also witnessed an impressive growth, reaching Rs7.11, a notable 336% YoY increase from Rs1.63 in the same period last year. This metric is a key indicator of the company's ability to generate value for its shareholders, showcasing the positive impact of PRL's operational efficiency and strategic decision-making, reports WealthPK.

Pakistan Refinery Limited (PRL) experienced a noticeable decline in its gross profit margin, plummeting from 10.60% in FY22 to a mere 2.79% in FY23. This substantial reduction signals potential challenges in the company's cost management or pricing strategy. The net profit margin of PRL also plummeted from 6.57% in FY22 to 0.70% in FY23. This downturn in profitability raises concerns about the company's ability to translate its revenue into bottom-line earnings. The EPS growth exhibited substantial volatility, with a sharp decline of 85.47% in FY23 following an exceptional growth of 1,213.16% in the previous fiscal year. This fluctuation suggests a degree of instability in PRL's earnings performance.

About the company

Pakistan Refinery Limited was incorporated in Pakistan as a public limited company in May 1960. The company is engaged in the production and sale of petroleum products. The company is a subsidiary of Pakistan State Oil Company Limited (PSO).

Credit: INP-WealthPk