Singaporean independent lubricant blender AP Oil posted a strong increase in net profit and lower revenue for the first half of 2020, compared to the first six months of last year.
AP Oil reported that its net profit for the six months ending June 30 increased 23% to 1.3 million Singapore dollars (U.S. $940,500), up from S$1.1 million.
Revenue decreased 5% to S$28 million, down from S$29.7 million. The company attributed the revenue slip mainly to a decrease in trading revenue, offset by higher manufacturing revenue. The company trades base oil, chemicals and other finished products. AP Oil manufactures lubricant and specialty chemicals.
Gross profit decreased by 17% to S$4.3 million, due to a decrease in gross margin by 2 percentage points as a result of lower margin for manufacturing revenue.
The company said that while its companies are classified as essential services by the Singapore Ministry of Trade and Industry, the COVID-19 pandemic’s impact on the global economy presents great challenges to its business, impacting demand for its products.
The blender markets automotive, industrial and marine lubricants under the AP Oil, SIN-O and Polaris brands. It has two blending plants in Singapore and a facility in Vietnam, operated by its joint venture, AP Saigon Petro. The blending plant in Vietnam has production capacity of 25,000 tons per year and 4,000 tons of tank storage for base oil, additives and finished products.