Shell Pakistan Limited (PSX: SHEL) announced its financial performance for the first quarter of 2023, which was severely impacted by the ongoing economic crisis in the country The earnings of the company turned crimson in 1QFY23 versus similar period last year – from a profit after tax of Rs2 billion, the company posted a loss of Rs4.6 billion.

The decline in earnings came on the back of unprecedented devaluation of the Rupee, rising inflation and macroeconomic uncertainty. The currency lost its value by 27 percent in 1QCY23 that brought massive exchange losses for the SHEL – this can be seen from the rise in other expenses by more than four times during the first quarter on a year-on-year basis.

Also affecting the profitability was the finance cost that grew by over three times in 1QCY23. The company’s director’s report highlights that the company continues to bear the burden of overdue legacy receivables of Rs5.3 billion from the Government of Pakistan.

However, the company’s topline remained robust primarily due to rising prices and also due to the company’s growth in of the lubricant segment. Even in the retail segment – renamed as the Mobility segment – continued to maintain market share despite the volumetric and macro-economic headwinds. Revenues for SHEL were seen climbing by 31 percent year-on-year in 1QCY23.