There are industries that seeing benefits in the deterioration of the kwacha against the dollar. These are industries that see exchange gains adding steroids to the bottom line. Oil marketing is one of them thanks to the cost pass-through mechanisms that are in place through the regulator, ERB.
Puma recently published their half-year results for 2020 on SENS through an announcement issued by Kalunga Lutato, company secretary on behalf of the board of the oil marketing company on 22nd September 2020.
Compared to the previous half year’s performance, the company enjoyed a 56.8% increase in profit after tax at half-year 2020 which rose to K80 million Kwacha. The following is the SENS announcement from the company in verbatim.
For the half-year ended 30 June 2020, the Company recorded a profit after tax of K80.064 million compared to K51.028 million recorded in the previous financial year. Volumes were 8% lower than those achieved for the same period last year.
A profit before finance costs, taxation and exchange gains of K148.402 million was achieved for the half-year ended 30 June 2020 compared to K102.479 million for the previous year, while the pre-tax profit was K127.019 million compared to K78.269 million the previous year.
he key highlights of the financial performance for the half-year were as follows:
- Volumes for the year reduced by 8% compared to the previous year. This was primarily due to the impact of Covid-19 pandemic
- During the half-year under review, the Company invested over K26.9 million in capital projects mainly in its Retail Network.
- During the half-year under review, the Kwacha depreciated by about 30% against the United States Dollar from K13.97 at beginning of the year to K18.15 at end of June 2020.
For the period under review, the Board did not propose an interim dividend due to continued liquidity challenges on account of tax receivables yet to be refunded.
Despite the negative effects of the Covid-19 pandemic, the Company has put in place adequate recovery plans to help in achieving its year-end target. The Company is determined to continue with its investment program and is confident to remain a key player in the energy sector. Safety of operations, personnel and customers will remain a key priority.