PSO raises HSFO price

KARACHI - Pakistan State Oil (PSO) on Friday has increased High Sulphur Furnace Oil (HSFO) price by Rs 1,255 per ton (2.6 percent) to Rs 49,633 per ton. The prices have been increased due to the high demand of the HSFO in the international market that caused change in form of raise on import price. However, the Board of Directors of PSO is scheduled to announce financial results for nine months ended March 31, 2010 on April 22, 2010. The company is expected to earn profit after tax of Rs 7.4 billion with earning per share of Rs 43.29 during the period under review as compared to loss after tax of Rs 9.3 billion with loss per share Rs 54.04 in the same period last year. Extinction of inventory and exchange losses is the main reason which led the bottom line of the Company to jump out of the red zone during the period under review. For third quarter alone, it is expected that the company is to earn net profit to the tune of Rs 2.3 billion with earning per share Rs 13.65 as compared to net profit of Rs 780m with earning per share Rs 4.55 in the corresponding quarter last year. Profitability of the Company in 2nd Quarter Financial Year 2010 jumped due to interest payments on overdue receivables realized to the tune of Rs 2.1b with earning per share impact of Rs 7.96. But the possibility of further realization of interest payments on the overdue receivables from the power sector cannot be ruled out as it poses an upside risk to earnings estimate, so the company is expected to pay interim cash dividends of Rs 5 per share.