Kicking off the June quarter earnings season, Lanka IOC PLC reported some solid top and bottom-line performance for the three months, riding on the ongoing recovery in the broader economy which requires, literally more fuel to help accelerate.

The company reported revenues of Rs.73.2 billion in the April – June quarter, up 34 percent from the same period last year, reflecting that increased mobility is helping the company to pump more fuel.

The recovery seen in the industrial activity in the country too is helping to drive up the sales for both its fuel and also lubricants.

Lanka IOC PLC is the second largest player in the Sri Lankan lubricant market with little over 20 percent market share after Chevron Lubricant Lanka PLC which commands a 43 percent share.

The bunker fuel sales are also visibly driving the top-line of the company due to increased global trade, and specifically due to the escalation in the Red Sea which prompted the shipping lines to stop for refueling.
While the reported top-line cannot capture, the company earlier this month introduced 100 Octane premium gasoline to the market.

Earlier in the month, the company’s top representatives called on the Power and Energy Minister, Kanchana Wijesekera and discussed a host of things including their plans on fuel stations, tank farm development and proposed oil pipeline between India and Sri Lanka.

The company reported an operating profit of Rs.3.44 billion for the quarter, up 31.3 percent from the same period last year.

The company meanwhile reported earnings of Rs.7.09 a share on total earnings of Rs.3.08 billion compared to earnings of Rs.4.59 a share or Rs.2.45 billion in the same period last year.

The company’s share ended Rs.1.00 or 0.84 percent higher at Rs.120.50 yesterday (July 18).
Investors expect the company to continue to do better in the coming quarters benefiting from the ongoing economic recovery.

The company increased its stocks by about Rs.3.5 billion to Rs.29.8 billion in the three months.
The company raised its short term investment portfolio while reducing its cash during the same period.