@Hawk Eye wrote:
The diversification from fuel to other products such as bitumen and other products for automobiles may have made significant change in revenue & GP Margin .The GP margin is improving YoY. Company transformed itself from a Gross Loss situation to Gross Profit from negative 1% to positive 7%. These are achieved by better resource management, product diversifications and the oil prices in international market
Year Revenue GP %
2008/09 47.6Bn -1%
2009/10 50.2Bn -1%
2010/11 51.7Bn 3%
2011/12 60.4Bn 7%
2012/13 75.1Bn 7%
Fuel & Lubricants
LIOC has 102 fully owned petrol stations and 42 franchised stations. 12 Lube Distributors
Lanka IOC also earned USD 118mn as foreign exchange exporting servo lubricants, and also exploring the possibilities to expand to the other South East Asian countries
Sri Lanka’s vision to provide accessibility to all parts of the country and to have a high and quality mobility road network in the country for the transportation of passenger and goods, a distinct emphasis has been given on road development. Road transport has become a priority sector because of the need to restore regionally balanced living conditions and economic opportunities for all Sri Lankans. Various important road infrastructure projects are under way.
New project implementations include
• Construction of expressways and highways,
• Widening of highways,
• Reduction of traffic congestion,
• Road maintenance and rehabilitation,
• Bridge rehabilitation and construction.
All these activities have resulted in increased requirement of bitumen. In 2012 LIOC has been able to cater to the increased market demand for bitumen and has registered a volume growth of 167% during
Lanka IOC has entered into the bunkering fuels business recently in a large way and has made a significant stride in this sector. Supplies are undertaken through nominations received from local shipping agents, shipping agents from overseas, bunker brokers and through direct nominations.
Number of vessels bunkered by LIOC is 60 at the moment
Bunker Fuelling Services – Various Ports in SriLanka
Colombo - Within port and OPL
Galle - Within port and OP
Trinco - Within port and OPL on specific demand
LIOCs GP will have a negative impact if the Oil barrel prices in international market goes up and the distribution prices in Sri lanka not increased accordingly. Oil barrel prices can go up once the demand starts increasing, which can happen once the high spending Economis starts showing positive indicators.
The chances are remote that Srilanka will keep the price down when the oil prices goes up in the world market due to the operational inefficiencies in PETCO.
Therefore the chances to report good results in 2013/14 is very high for LIOC.