Lanka IOC PLC reported extremely sluggish revenues, resulting in a deeper loss during the three months to June 30, 2020, as the demand for gasoline was at its lowest since much of the quarter remained economically inactive amid COVID-19 lockdowns.

The company reported revenues of Rs.10.7 billion during the April-June 2020 period, down 42 percent from Rs.18.4 billion in the year earlier period, recording perhaps the worst decline in the revenues for the company in a single quarter. 

The company’s share lost 40 cents or Rs.2.38 yesterday to close at Rs.16.40. 

The direct costs, which contain the cost of the imported fuel bill, fell by 37 percent year-on-year (YoY) to Rs.11.3 billion, as the company may have adjusted its orders in line with the easing future demand while the company may have also been able to take advantage of the falling global oil prices. The global oil prices went on a wild ride during the quarter, as the prices turned to negative at one point in mid-April, since the demand sank while the global storage capacity was nearly running out. 

The prices have since recovered with the easing of stay-at-home orders and reopening of factories 
while air travel has also resumed a stoking demand for oil. 

The crude oil prices in the Brent futures exchange have risen to US $ 43.07 a barrel, as of yesterday, while the refined oil prices for petrol, diesel and kerosene, have also surged in the Singapore market to a similar range, except for diesel, which had a price of US $ 48.48, as of July 24.

Lanka IOC is the only other distributor of gasoline and other fuels in the country after the state-owned Ceylon
Petroleum Corporation. 

The company is also into bunkering, bitumen and petrochemicals and is the second largest lubricant marketer in the country. The company reported a net loss of Rs.1.49 a share or Rs.795.5 million for the quarter, significantly expanding from the net loss of Rs.239.2 million in the comparable quarter, last year. 

Indian Oil Corporation Limited has a 75.12 percent stake in Lanka IOC.