Attock Petroleum Limited (APL) announced its financial result for FY21 whereby the company declared a Profit After Tax (PAT) of PKR 4.9bn (EPS: PKR 49.43) compared to profit of PKR 1.0bn (EPS: PKR 10.13) in FY20. On quarterly basis, profit clocked-in at PKR 1,255mn (EPS: PKR 12.61) compared to earnings of PKR 138mn (EPS: PKR 1.38) in 4QFY20 and PKR 1,518mn (EPS: PKR 15.25), respectively. Along with the result, the company also announced a cash dividend of PKR 24.5/share, taking FY21 payout to PKR 27.0/share

Result Highlights

·        Topline of the company settled at PKR 53bn for 4QFY21, up by 52% YoY due to growth in overall sales volume by 19% YoY (Furnace Oil volumes increased by 30% YoY) and higher prices of petroleum products in the period under review. During FY21, topline registered a decline of 6% YoY due to lower selling prices of petroleum products.

·        The company posted a gross profit of PKR 2,315mn in 4QFY21 compared to gross profit of PKR 955mn. We view noteworthy changes in ex-refinery prices that resulted in inventory gains of PKR 400mn in 4QFY21 compared to inventory loss in same period last year. During FY21, company recognized inventory gains of PKR ~1.5bn.

·        Meanwhile, finance costs dropped by 35% YoY to PKR 304mn is owing to decline in interest rates.

·        The company recorded effective taxation at 29.8% in 4QFY21 compared to 45.7% in SPLY.

Recommendation

Currently, we have a ‘BUY’ call on the stock with our Dec’21 target price of 441.5/share.

Courtesy – AHL Research