November 14, 2023

Future Energy Source Company Limited (FESCO) for the six months ended September 30, 2023 reported a 3% increase in Revenue totaling $13.77 billion compared to $13.43 billion in the corresponding period last year. Revenue for the second quarter had a 3% increase to close at $7.20 billion compared to $6.97 billion for the comparable quarter of 2022. Year over year, refinery prices have decreased, however, significant growth in litres of fuel sold contributed to the growth in revenues.

Cost Of Goods Sold amounted to $13.05 billion (2022: $13.02 billion).

Consequently, gross profit increased by 77% to $718.51 million compared to $406.25 million for the six months ended September 30, 2022. The company booked gross profit of $379.88 million for the second quarter versus $190.18 million reported for the similar quarter of 2022. FESCO highlighted, “The improvement in gross profit reflects both increasing throughput (measured in litres of fuel sold) and diversification of product offerings (fuel types including LPG) and services (increased retail presence).”

Operating and admin expenses increased by 161% from $130.74 million in 2022 to $340.63 million in 2023. This directly reflects growth in operations, operational scope, asset base and early stage new business costs.

Operating Profit for the six months ended September 30, 2023, amounted to $377.88 million, a 37% increase relative to $275.51 million reported in 2022. Operating Profit for the second quarter amounted to $175.82 million (2022: $124.48 million).

Finance Cost totalled $61.17 million, relative to finance income of $5.57 million reported in 2022.

No taxes were incurred during the period. As such, net profit for the six months amounted to $316.70 million, a 13% increase from the $281.08 million reported in 2022. For the second quarter, net profit was $158.69 million (2022: $129.29 million).

FESCO noted, “In December 2023 the Company expects to open its twenty first (21st) retail service station FESCO Port Maria. We welcome and invite you our valued stakeholders to patronise the station. We hope that all our stations will continue to provide you our valued stakeholders with great fuelling opportunities and services.”

Consequently, Earnings Per Share for the six months amounted to $0.13 (2022: EPS: $0.11), while Earnings Per Share for the quarter totaled $0.06 (2022: EPS: $0.05). The twelve-month trailing EPS was $0.24 and the number of shares used in these calculations was 2,500,000,000.

Notably, FESCO’s stock price closed the trading period on November 14, 2023 at a price of $3.63 with a corresponding P/E ratio of 14.95x.

Balance Sheet Highlights

The company’s assets totalled $4.66 billion (2022: $3.27 billion). The growth in total assets was primarily due to ‘Property, plant and equipment’ increasing 44% to $2.88 billion (2022: $2.00 billion), and ‘Receivables’ growing 129% to close at $964.25 million (2022: $421.63 million).

Shareholder’s equity was $1.62 billion (2022: $1.05 billion), representing a book value per share of $0.65 (2022: $0.42).

The Company also noted the following accomplishments:

• In late August, open its 20th FESCO branded retail service station, FESCO Kitson Town
• Further expand its LPG facilities, fleet, operations and distribution footprint
• Continue its service station network expansion and work-in-progress Capex/investments”

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