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ANALYSIS OF PERFORMANCE
INDICATORS
Liquidity ratio
The overall liquidity ratio of POL is satisfactory and
geared towards enhanced liquidity with operating
activities generating enough cash to meet majority
of the Company needs including the investments
activities. Increase in ratios from the previous year is
mainly because of cash and bank balances increased
by 20% due to lower operating and exploration cost
paid.
Profitability ratio
The overall profitability (gross profit and net profit)
have increased while other profitability ratio
(EBITDA, ROE and ROCE) have seen decline due
to lower net sales by decrease sales volume and
international crude oil prices as a result of COVID-19.
Activity / Turnover Ratios
POL has seen effective utilization of its assets base
to generate high multiples of revenue consistently.
Operating cycle has been effectively kept in range
by minimal credit sales and improved collection of
receivables.
Investment / Market Ratios
POL core objective is to generate consistent high
returns for its valued shareholders. This is reflected
in steady increase in earnings of the past years and
consistent dividend to its valued shareholders.
POL shares are highly valued by investors and is
considered as a blue chip investment due to high
price earnings ratio.
Economic Value Added (EVA)
Rs in million
2020
2019
Net Profit after tax
16,376 16,872
Invested Capital
40,267 38,071
WACC
16% 18%
EVA
10,0
0
0 9,881
The above outcomes in 2020 in EVA means that the
company is creating value with its invested capital.
Slight decrease in the current year profit is mainly
due to decrease in sales volume and international
crude oil prices as a result of COVID-19.
Free Cash Flows
Rs in million
2020
2019
Cash Flows from
Operating Activities
23,263 21,425
Capital Expenditure
6,737
1,400
Free Cash Flows
16,526 20,025
Free Cash Flows for the current year decreased is
lower due to decrease in net sales by Rs5.5 billion.
Decrease in sales was mainly due to lower sales
volume and international prices as a result of
COVID-19 during the year.
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PAKISTANOILFIELDS LIMITED