Lanka IOC PLC kicked off the June quarter earnings season with impressive top and bottom-line results, driven by the ongoing recovery in the broader economy, which has increased the demand for fuel.
For the April-June quarter, Lanka IOC reported revenues of Rs. 73.2 billion, a 34 percent increase from the same period last year. This surge reflects heightened mobility and industrial activity, contributing to higher fuel and lubricant sales.
As the second largest player in the Sri Lankan lubricant market, with a little over 20 percent market share, Lanka IOC follows Chevron Lubricant Lanka PLC, which holds a 43 percent share. The company's top-line performance has also benefited from increased bunker fuel sales due to rising global trade and the escalation in the Red Sea, which has prompted more shipping lines to stop for refueling.
In a recent move, Lanka IOC introduced 100 Octane premium gasoline to the market. The company’s senior representatives also met with Power and Energy Minister Kanchana Wijesekera earlier this month to discuss future plans, including fuel stations, tank farm development, and a proposed oil pipeline between India and Sri Lanka.
Lanka IOC reported an operating profit of Rs. 3.44 billion for the quarter, marking a 31.3 percent increase from the same period last year. Earnings per share stood at Rs. 7.09 on total earnings of Rs. 3.08 billion, compared to Rs. 4.59 per share or Rs. 2.45 billion in the same period last year. The company’s share price rose by Rs. 1.00 or 0.84 percent to Rs. 120.50 on July 18.
Investors are optimistic about the company’s future performance, anticipating continued benefits from the ongoing economic recovery. During the quarter, Lanka IOC increased its stocks by about Rs. 3.5 billion to Rs. 29.8 billion and raised its short-term investment portfolio while reducing its cash holdings.
