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Feb 03, 2018 / 19:13

Petrolimex reports after-tax profit lower than expected

Vietnam National Petroleum Group (Petrolimex)’s consolidated net revenue reached VND155 trillion (US$6.8 billion), an increase of 26%, according to the group’s latest report on 2017 business result.

As such, Petrolimex recorded it after-tax profit at VND4 trillion (US$175 million), reducing VND1.1 trillion (US$48 million) year-on-year. 
 
Petrolimex recorded it after-tax profit at VND4 trillion (US$175 million).
Petrolimex recorded it after-tax profit at VND4 trillion (US$175 million).
In 2017, total consolidated net revenue from Petrolimex’s subsidiaries in all business fields (petroleum, gas, petroleum transportation, design, construction, insurance, mechanism) accounts for VND155 trillion (US$6.8 billion), up 26% compared to the same period of last year. 

The increase in revenue is mainly thanks to the global average price of crude oil in 2017 at US$50.85 per barrel, up 17.4% over 2016 (US$43.30 per barrel).

In spite of an increase in revenue, rising prime cost has led to a reduction in profit at Petrolimex’s affiliates and consortiums, resulting in the group’s pre-tax profit at VND4.8 trillion (US$210 million), reducing VND1.4 trillion (US$61 million or 22.6%) comparing to 2016. 

Consequently, Petrolimex’s after-tax profit reached VND4 trillion (US$175 million), reducing VND1.1 trillion (US$48 million) or 22.6% over the last year. Petrolimex has contributed VND38.3 trillion (US$1.68 billion) to state budget, increasing 16.3% year-on-year. 

The group had set target for 2017 of reaching consolidated revenue at VND143 trillion (US$6.2 billion), in which consolidated pre-tax profit would be VND4.7 trillion (US$206 million), according to the annual shareholder meeting in 2017. That said, the company has exceeded 4% of the original target. 

By the end of 2017, Petrolimex’s total assets reached VND66.5 trillion (US$2.9 billion), increasing VND12 trillion (US$526 million) compared to the year’s beginning. The group’s inventory value is estimated at VND12.7 trillion (US$55.7 million), 1.5 times higher than at the year’s beginning and accounts for 20% of total assets. 

At present, Petrolimex’s share changes hand at VND89,000 (US$3.9) per share, equaling the price to earnings (P/E) 30 ratio. Currently, the share is receiving great attention from investors with sharp increase of 20% in value for the first month of 2018. 

Petrolimex posted positive business results in 2015 and 2016. In 2015, the group’s pre-tax profit experienced strong growth at VND3.7 trillion (US$162 million), 10 times higher than the number in 2014 at VND321 billion (US$14 million). Out of this number pre-tax profit from petroleum-related activities accounted for VND2 trillion (US$87 million). 

In 2016, total consolidated pre-tax profit set new record at VND6.3 trillion (US$276 million), in which pre-tax profit from petroleum-related activities contributed VND3.9 trillion (US$171 million). 

This year, Petrolimex will step up effort in replacing A92 petrol by E5 bio-fuel nationwide on the basis of the Prime Minister’s decision No.53 on November 2012, in which promulgating a roadmap for application of ratios for blending biofuels with traditional fuels, as well as Decision No.49 dated September 2011, providing the roadmap for application of exhaust emission standards to manufactured, assembled and imported brand-new cars and motorbikes. 

On the other hand, following the Prime Minister’s instruction on restructuring Petrolimex, the group will divest all state funds in banking sector.