Blender Hi-Tech Lubricants reported strong rebounds in net profit and operating profit for its lubricants segment in the quarter ended Sept. 30, while sales revenue jumped 21% despite myriad economic challenges in the Pakistan market.
Its lubricants segment was profitable during the quarter “notably despite all odds,” the company said in its earnings report, and it described market challenges in Pakistan. “While the Pakistani rupee has shown some signs of recovery, we anticipate that economic challenges such as depressing [gross domestic product] growth, extremely higher finance costs, high inflation, increased commodity prices, higher taxation and limited foreign exchange availability for imports will continue to persist,” the company said. “These factors have adversely impacted consumption as a result of significant pressure on consumers’ disposable income.”
The company’s lubricants segment net profit improved to Rs 7.2 million (U.S. $25,000), compared to a Rs 289.6 million net loss, for the quarter, which is the first of its fiscal year.
The segment’s profit from operations rebounded to Rs 135.3 million in the quarter, improving from an Rs 158.2 million loss from operations.
Net sales revenue from contracts with customers rose 21% to Rs 1.6 billion, compared to Rs 1.3 billion. Overall gross sales revenue for the company was also up, by 7%, to Rs 5 billion.
“The increase in revenue can be attributed to growth across our lubricant product portfolio, especially local blended items, complemented by a favorable product mix, demand generating activities and competitive pricing,” the company said.
As a whole, the company posted an Rs 56.7 million net loss, much smaller than a Rs 280.3 million net loss. Profit from operations improved to Rs 181.3 million in the quarter, compared to an Rs 210.4 million loss from operations. “Our operating profit also improved as a result of localization of raw and packaging materials and other operating cost control measures,” the company said.