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Daily Times of Pakistan: Shell’s profits plummet by 77 percent

Tuesday, August 07, 2007

KARACHI: The profit after tax of Shell Pakistan Limited plunged by 77 percent to Rs 706.659 million in the financial year 2006-07 as against 3.147 billion in the previous year, according to a notice of Karachi Stock Exchange.

The board of directors of the company approved the financial results of the company for the year under review on Monday.

The board announced cash dividend of 80 percent for its shareholders for the financial year ended June 30, 2007.

The earnings per share declined to Rs 12.90 in the said year from Rs 57.44 a year earlier. The profit before tax went down to Rs 327.923 million during the year from Rs 1.493 billion in the last year. The sales of the company plummeted to Rs 130.129 billion in the year from Rs 132.129 billion in the last year.

Chairman and CEO Shell Pakistan Limited Zaiviji Ismail Bin Abdullah said the cash flow constraints resulting from overdue government receivables is the greatest challenge faced by the company. The timely recovery of these receivables is paramount to sustaining the viability of this company, he added. Analysts said that market share of Shell Pakistan Limited (SPL) dropped to 14 percent from 18 percent in fiscal 2006-07, but they noted that earning per share is still impressive in the market.

The distribution costs of the company stood at Rs 3.366 billion in the year as against Rs 2.710 billion during the last year before. Administrative and marketing expenses decreased to Rs 2.036 billion from Rs 2.086 billion in the previous year.

Farhan Mehmood, an analyst at JS Research, said the inventory losses gripped the oil marketing company in 2006, due to which its annual revenue declined substantially. Besides, high financial expenses also affected the earning of the company, he said. staff report

http://www.dailytimes.com.pk/default.asp?page=2007%5C08%5C07%5Cstory_7-8-2007_pg5_4

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