LOTCHEM Positive earning likely in 2QCY15 – WE Research

LOTCHEM: Positive earning likely in 2QCY15 On back of increased primary margins, the bottom-line of LOTCHEM is anticipated to post a profit after taxation (PAT) of Rs 323 million (EPS: Rs 0.21) in 2QCY15 versus a loss after taxation (LAT) of Rs 147 million (LPS: Rs 0.10) in 2QCY14. The primary margin of PTA/PX reached $120/ton in 2QCY15. On a cumulative basis however the company would show marginal profit due to lower primary margins where PAT to total Rs 17 million (EPS: Rs 0.01) in 1HCY15 as against LAT of Rs431 million (LPS: Rs 0.28) in 1HCY14. Further, the significant drop in other income would also dent the bottom-line. The net revenue of the company is expected to decline by 35% YoY in 1HCY15 to Rs 16,119 million versus Rs 24,804 million in 1HCY14.

PPL: Lower crude oil prices weigh high on earnings Likewise other companies of the oil & gas sector, FY15 proved to be a depressing year for PPL too where we expect that the bottom-line of the company to witness a decline of 26% YoY due to heavy decline in crude oil prices. The PAT of the company is likely to total Rs 37,919 million (EPS: Rs 19.23) in FY15 as against a PAT of Rs 51,417 million (EPS 26.08) in FY14. Along with lower crude oil prices, the bottom-line would also affected by decline in gas production and impairment of loss on investment in PPL Europe E&P Limited. However, the expected rise in other income would have a positive impact on profitability. The average international crude oil prices dropped 32% YoY during the year to $72/barrel as against $106/barrel in FY14. The gas production of the company reduced by 5% YoY in FY15 to 730mmcfd owing to lower production from Kandhkot, Mazarani, Sui, and Tal blocks. On the other side oil production grew by 18% YoY to 15kbpd in FY15 on back of increased production from; Adhi, Hala, Nashpa, and Tal blocks. The corporate results are likely to be accompanied with a final cash dividend of Rs4.5/share in addition to the already paid cash dividend of Rs4.5/share during 9MFY15.

Read the complete report below

[embeddoc url=”http://104.238.172.60/ifm/wp-content/uploads/2015/08/we-research-12th-aug15.pdf” viewer=”google”]