KARACHI, Nov 13: Fuel & Energy sector, which commands market capitalization of Rs132 billion or a quarter of all of the market value of listed stocks at the Karachi Stock Exchange, posted net income of Rs20 billion for financial year 2002, a report prepared by stock brokerage firm, IP Securities, has said.

The net income for financial year 2002 (FY02), was down 5 per cent from Rs21 billion the previous year and excluded the KESC’s unaudited results for FY02, wherein the utility had posted mammoth loss of Rs17 billion. Adjusting for the loss, the aggregate income of the sector stood at Rs1.8 billion, compared with Rs4.6 billion in FY01.

Fuel & Energy sector could be placed in sub-sectors of Exploration and Production (E&P) companies; power & electric; oil marketing companies (OMCs); and gas companies. Humaira Zaheer, who follows the energy sector at IP Securities says: “Screening out the sub-sectors, the E&P companies have a 15 per cent share in the fuel & energy sector.”

The analyst points out that during FY02, E&P companies posted aggregate after tax profit of Rs3.5 billion, which represented 7 per cent increase over the taxed profit of Rs3.3 billion in the earlier year. The increase was attributable mainly to higher margins, based on stabilised crude oil prices. Analyst stated that the cash flows of E&P companies had also improved on the back of revision of pricing formula for the refineries to bring prices of the refined products closer to the landed cost concept resulting in strong footing of the local refiners.

The two oil marketing companies—PSO and Shell—remained in the limelight all through the year. Profit after tax at PSO surged 42 per cent to Rs3.18 billion, from Rs2.25 billion in 2001, primarily on account of a 414 per cent increase in non-operating income, while the net income at Shell grew slightly to Rs1.06 billion, compared with Rs1.05 billion in 2001.

Hubco—the trend-setter at the stock exchange—was also the largest company on the sector. Hubco posted after-tax profit of Rs7.3 billion for the year under review, down 33 per cent from Rs10.9 billion the previous year; the 2001 net income being higher on account of reversal of doubtful debts. Power & electric sub-sector made a cumulative loss of Rs 9.7 billion, sharply larger than the loss of Rs 4.9 billion in FY01, but most of it was due to the dismal performance of KESC.

Among gas companies, Sui Southern and Sui Northern, along with Mari Gas, logged in net income of Rs3.7 billion, registering 31 per cent increase over the previous year. That was stated to be mainly due to an increase in gas sales.

Based on income, Hubco topped the list of top ten companies on the fuel & energy sector. It was followed by PSO, POL, SNGPL, SSGC, Shell, Kohinoor Energy, National Refinery, Attock Refinery and Mari Gas.