Lanka IOC reports loss of Rs 30 per liter of diesel fuel

Lanka IOC, a subsidiary of Indian Oil Corp. located in Sri Lanka, reported a loss of Rs 111 million (US$1.01 million) in the quarter ending March 2011. The loss reflects the company’s struggles to deal with heavy taxation and government price restrictions. Suresh Kumar, managing director of Lanka IOC, said the company was losing approximately Rs 30 (US$0.67) on every liter of diesel sold, but breaking even on petrol sales. Revenues for the March 2011 quarter were Rs16.2 billion (US$362.15 million). Profits for the full year ending March 2011 were Rs 876 million rupees (US$19.5 million). According to Kumar, the company recently raised diesel prices by nine rupees (US$.20) over Ceylon Petroleum Corp.’s prices, which resulted in a drop in diesel sales by 50 to 60%. (June 1, 2011)