KARACHI, Sept 29: Sui Southern Gas Company (SSGC) declared a cash dividend of 15 per cent i.e. Rs1.50 per share for the financial year ended June 30, 2005. The company earned an after tax profit of Rs1.013 billion as compared to Rs0.997 billion the previous year.
This was announced in a meeting of the Board of Directors of SSGC held here on Thursday. The meeting was presided over by SSGC Chairman Aitzaz Shahbaz. The board reviewed and approved the audited accounts of the company for the year 2004-05.
The board was informed that during the year under review, company’s gross sales increased to Rs62.51 billion as compared to Rs54.45 billion in 2003-04, up by 15 per cent. Gas sales volume grew to 337,638 mmcf as compared to 318,068 mmcf the previous year, showing a rise of six per cent. The increase in volume was mainly on account of increased demand from the cement, fertilizer and other industries as well as domestic customers.
According to a press release, sales to the power sector constituted 46 per cent of the total sales. KESC again was the major customer and accounted for 28 per cent of company’s sales.
The company’s cost of gas per mmcf increased by about 13pc as a result of increases in well-head prices as well as changes in the supply-mix, in favour of the more expensive fields.
During the year under review, SSGC extended its transmission and distribution network by 1,424km and the customer base by 78,578. A total of 233 new towns and villages in Sindh and Balochistan were provided gas this year. Two major pipelines laid in Balochistan this year connected towns of Ziarat and Kalat to the SSGC network and brought urban convenience to villages and “killies” in the area. At the same time the 116km pipeline from Hyderabad to Karachi, part of the Nawabshah to Karachi pipeline project was completed on time and well within budget.
The transmission and distribution cost as a percentage of revenue was reduced from 7.4 to 7.3 per cent and financial charges were brought down by about Rs133 million, compared to the corresponding period last year. Earnings per share increased to Rs1.51 as against Rs1.49 last year. This is despite the pressures on account of disallowance of various charges by Ogra.
During the year 2004-05, CAPEX (capital expenditure) amounted to Rs6.2bn, which is a significant increase over the previous year, and Rs4.7bn was capitalized as additions to the fixed asset base. This resulted in additional return, which was largely offset by excess UFG or Unaccounted for Gas due to line losses and theft during the year under review.
For the year, Ogra issued its final determination of revenue requirements of Rs55,142 million, as against the company’s claim of Rs55,994 million, resulting in shortfall of Rs852 million. A major item contributing to reduction in revenue requirement was UFG for which the authority determined Rs694 million being excess of UFG over the target of six per cent.
To meet the rising gas demand, the company has imitated an LNG project, which will bring additional gas supplies of 300 to 500 mmcfd from 2009-10 onwards.
