Page 116 - Pakistan Oilfield Limited - Annual Report 2022

114
PAKISTAN OILFIELDS LIMITED
Analysis of Performance

Indicators

Profitability ratio Economic Value Added (EVA)

The overall profitability (gross profit, net profit,
EBITDA, ROE, and ROCE) have seen increasing Rs in million
mainly due to higher sales and other income 2022 2021
during the year. Net profit after tax 25,935 13,382
Invested capital 51,063 39,362
Liquidity ratio WACC 19.50% 19.50%

The overall liquidity ratio of POL is satisfactory EVA 15,980 7,071
and the Company has sufficient cash and bank The above outcomes in 2022 in EVA means that
balances. In the current as well as last year, net the Company is creating value with its invested
cash flows from operating activities is positive. capital. Increase in the current year’s profit is
Increase in ratio from the previous year is mainly mainly due to higher sales and other income (due
because of higher receipts from customers. to higher markup rates and higher exchange gain

Activity / turnover ratios on foreign currency bank balances).

POL has seen effective utilization of its assets Free cash flows
base to generate high multiples of revenue
consistently. Operating cycle has been effectively Rs in million
kept in range by minimal credit sales and 2022 2021
improved collection of receivables. Cash flows from

Investment / market ratios operating activities 27,906 19,479
Capital expenditure 4,570 1,733
POL core objectives are to generate consistent Free cash flows 23,336 17,746
high returns for its valued shareholders. This
is also reflected from its steady increase in Free cash flows for the current year increased
earnings of current/past years and consistent due to higher sales. Cash flow from operating
dividend to its valued shareholders. activities increased mainly due to higher receipts
from customers.
POL shares are highly valued by investors and is
considered as blue chip investment due to high
price earnings ratio.