The management of Attock Petroleum Limited (APL) held a corporate briefing session on 7th Nov’24 to discuss the FY24 financial result and future outlook.
Brief Takeaways
§ APL reported a profit after tax (PAT) of PKR 14bn (EPS: PKR 111.09) for FY24, up 11% YoY.
§ As of Jun’24, APL has a total storage capacity of 210k tons and operates over 800 retail sites, with 32 new outlets added during this period.
§ The company plans to expand storage capacity with new facilities in Rawalpindi and Port Qasim, with capacities of 10.0k tons and 18.7k tons, respectively.
§ The management highlighted that the company’s efficient inventory management has resulted in lower inventory losses compared to the industry.
§ In response to a question on OMC margins, the management shared that OGRA has recommended increasing OMC margins by PKR 1.35/ltr on both MS and HSD. However, the company believes the margin increase should be higher and is currently discussing with the government to link it to inflation.
§ The management acknowledged that competition is intensifying due to mergers and acquisitions by foreign companies. Despite this, the management is confident that the company’s performance will remain intact. Moreover, APL is considering acquiring local companies to increase its market share.
§ The company expects to officially commence its LPG project in Jan’25 with a capacity of 300 MT, focusing on industrial customers for LPG sales in the beginning.
§ Regarding the line-fill cost in finance income for FY24, the management explained that this is a leftover pipeline stock cost received by the company. OGRA has established a mechanism that includes stock value and interest rates. With this mechanism in place, the cost will recur every quarter.
§ The company is engaged with the government on the EV policy. The management stated that the policy should offer incentives for the OMC industry, and a tariff incorporating the company’s costs and margin should be determined.
§ The government has instructed OMC companies to establish EV stations along the Peshawar to Karachi Motorway. For this purpose, the company is considering forming joint ventures with other companies.
§ Regarding de-regulation, the management shared that the company is in regular discussions with the government, but no decisions have been made yet.
Courtesy – AHL Research
