KARACHI: Sui Southern Gas Company (SSGC) released the much-awaited financial results for the year ended June 30, 2017, posting a consolidated profit of Rs1.47 billion against a loss of Rs5.86 billion in the preceding year.
The turnaround in earnings was realised with a massive cut in gas development surcharge, gas losses, operating losses and finance cost and a significant boost to the other operating income, according to a bourse filing.
SSGC reported earnings per share of Rs1.67 for the year compared to a loss per share of Rs6.65 in the preceding year, according to a notification sent to the Pakistan Stock Exchange (PSX) on Monday.
SSGC’s share price improved 2.47%, or Rs0.56, and closed at Rs23.20 with trading in 2.77 million shares at the PSX.
“We believe SSGC has recorded a one-time gain of around Rs5-7 billion on account of revised UFG (unaccounted-for-gas or line losses) benchmark of 2.6% under local conditions over and above the technical benchmark of 4.5%,” Topline Securities said in post-result comments. “This enhanced the company’s UFG allowable (to be recovered from end-consumers) benchmark to 7.1% for FY13-16.”
SSGC was allowed a UFG of 6-6.1% for FY13-16 as per a study conducted by KPMG, it recalled. The gas utility’s net sales surged 13% to Rs156.67 billion after it paid a lower gas development surcharge of Rs4.68 billion in FY17 compared to Rs44.78 billion in the previous year.
Gas losses dropped 29 times to Rs850.74 million compared to Rs24.82 billion following the UFG adjustment.
Operating losses fell to Rs2 billion compared to Rs28.36 billion. Finance cost plummeted to Rs1.69 billion compared to Rs2.61 billion.
On the other hand, other operating income rose to Rs6.55 billion compared to Rs2.72 billion. It, however, recorded a massive plunge in other non-operating income to Rs7.18 billion compared to Rs23.35 billion last year.
Published in The Express Tribune, January 8th, 2019.