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Yetebaberut Beherawi Petroleum (YBP) registered a lower profit over the last fiscal year 2011/12 when compared to the previous fiscal year.
At the 8th Shareholders General Assembly the company held at the Hilton Addis on January 3, 2013, the Board of Directors reported a 5.5 million birr net profit after tax, 12.5 million birr down from the previous fiscal year report which stood at 18.7 million. The company sold 262.1 million litre gas and 1.72 million litre oil and collected 4.5 billion birr. This has shown an increase of 1.5 billion birr or 31 percent when compared to last year’s performance.
The gross profit the company made stood at 32.8 million birr. This has shown a 13 million birr decrease or 31 percent from the 2010/11. The profit from gas sale, 262.1 million litre, was only 39.5 percent while the profit from the sale of lubricant oil, 1.7 million litre, stood at 60.5 percent.
The reason for the decrease in profit is attributed to employees’ salary increment; increase in the cost of rental houses, the increase in the price of pumps, spare parts, etc.
“We have sold much more products than the previous fiscal year. However the profit is much lower,” Tsega Asamere, Chairman of Board of Directors of YBP told Capital.
The chairman also complained the profit margin companies are allowed to make is very little. “The profit margin is made while the price of oil is 3.50 birr. Today the average price for diesel and kerosene is 16 birr and benzene is 19 birr,” he said. “For instance we used to buy 100,000 litre oil with 350,000 birr. We are buying the same amount of oil at 1.9 million birr today. However the profit stood at the same level for both investments.” Tsega, who says the price of gas in Ethiopia compared to other countries is low, is hopeful that the government will review the profit margin as per the industry’s long time and persistent request. He said the margin increase would be only in cents which wouldn’t challenge buyers.
Back in 2008 the then Ministry of Trade and Industry (MoTI) had rejected a proposal presented by oil companies saying there is no need to review the profit margin.
Established by 21 shareholders with 5.2 million birr capital eight years ago, the company has planned to increase sales from 4.5 billion birr to 7 billion birr, total income from 31.2 to 58.2 million birr, and the paid up capital from 100 million birr to 200 million birr. It initially had only 7 stations. Currently it has 81 stations and this number is due to rise to 103 by June 2013.