LAUGFS Gas powers its way to profitability in 1H

Tuesday, 3 November 2020 01:12 - - {{hitsCtrl.values.hits}}

LAUGFS Gas Executive Chairman W.H.K. Wegapitiya

LAUGFS Gas Plc (LGL) has bounced back to profit in the first half of FY21 thanks to a strong second quarter.

As per interim results released yesterday, LGL posted a Group pre-tax profit of Rs. 189 million in the first half of FY21 as against a loss of Rs. 155.3 million. In FY20, the Group suffered a Rs. 1.84 billion loss.

After tax profit in the first six months ended 30 September 2020 was Rs. 221.7 million in comparison to a loss of Rs. 241 million. In FY20 the after tax loss was Rs. 1.7 billion.

Investors yesterday reacted positively to LAUGFS results with voting share price up over 6% to Rs. 18.10 and non-voting gaining by 10% to Rs. 13.

LGL’s first half top line saw 13% growth to Rs. 14.6 billion. In FY20 revenue was Rs. 27.2 billion. First half operating profit was Rs. 1.39 billion s against Rs. 1 billion a year earlier.

In the second quarter revenue was up by31% to Rs. 8.85 billion. Gross profit was down by 4% to Rs. 1.6 billion but higher operating income and better management of selling and distribution expenses, administrative expenses and gain in foreign currency helped to boost operating profit by 31% to Rs. 1 billion.

Pre-tax profit in 2Q was Rs. 394 million, a substantial 235% increase from a year earlier whilst after tax profit saw a massive leap to Rs. 401.5 million from Rs. 21 million in 2Q of FY20.

LGL’s Group assets as at 30 September 2020 were Rs. 41 billion, up from Rs. 38 billion a year earlier. Liabilities have declined as well with non-current component down from Rs. 18.5 billion to Rs. 17 billion and current component from Rs. 18.4 billion to Rs. 23 billion. LGL however continues to be saddled with Rs. 2.3 billion in retained losses as at 30 September 2020.

In the first quarter of FY21, LGL reported a loss of Rs. 180 million, though lower in comparison to Rs. 266 million a year earlier. Revenue was down by 6% to Rs. 5.7 billion.

LGL’s transportation and logistics business segment performed outstandingly with revenue more than doubling to Rs. 1.4 billion and reporting a profit of Rs. 292 million as against a loss of Rs. 352 million in 1H of FY20.

Trading revenue almost tripled to Rs. 11.3 billion whilst profit amounted to Rs. 51 million up from Rs. 22.7 million in 1H of FY20.

Energy segment saw revenue decline to Rs. 10.8 billion from Rs. 12.6 billion and suffered a loss of Rs. 164 million as against a profit of Rs. 48 million.