Meghna Petroleum posts profit growth despite lower revenue

Despite a slight decline in sales, Meghna Petroleum Ltd posted higher profits year-on-year in the October-December quarter of the current fiscal year – thanks to its cost control and the increase in investment income.

The company’s managing director, Mir Saifullah-Al-Khaled, told The Business Standard: “Operating income fell due to a sharp decline in heating oil sales and the absence of revenue from the company with local fractionation plants”.

Meghna Petroleum’s fuel oil supply to power plants fell by 40,000 tons year-on-year in the October-December quarter, with private sector power plants importing the fuel themselves in 2021.

As Meghna alone imported and supplied 40% of fuel oil in 2020, the decline hurt its revenue the most, he said.

Meghna has also lost revenue because private sector fractionation plants – which produce gasoline and kerosene from condensate and resell them either to Meghna or to its competitors Jamuna Oil and Padma Oil – have ceased operations. due to regulatory decisions from October to December. of 2021.

Its chief executive expects business with the fractionation plants to pick up sooner, while he’s not much hope for private sector power plants to buy a lot of fuel oil from them unless there’s a regulatory obligation.

Its sales of petroleum products fell to Tk 56.23 crore in the October-December quarter from Tk 59.06 in the same quarter a year ago.

However, the state-owned fuel distributor managed to reduce its administrative, sales and distribution expenses, as well as its financial expenses, which resulted in posting Tk 30.83 crore in operating profit from Tk 28 .58 crores of Tk in the same quarter of 2020.

In addition, its non-operating income, mainly income from its investments of more than Tk 1,800 crore in term deposits and other securities, increased to more than Tk 65 crore from Tk 58.3 crore.

Its net profit after tax for the last three months of 2021 rose to Tk 70.4 crore from Tk 61.7 crore a year ago.

Quarterly earnings per share (EPS) rose to Tk 6.51 from Tk 5.7 a year ago.

For the first half of the financial year (July-December), Meghna Petroleum posted 12.74 Tk in EPS, against 12.24 Tk a year ago.

The net asset value per share of the company amounted to Tk 172.64 at the end of December.

Shares of Meghna Petroleum closed down 0.1% at Tk 208.5 each on Sunday on the Dhaka Stock Exchange.