STO Revenue Jumps 27% to MVR 6.98bn in Q2 2026 Despite Lower Gross Profit
From STO’s Annual General Meeting held on May 16, 2026 | Photo: STO
State Trading Organization (STO) recorded a 27% increase in revenue to MVR 6.98 billion in the second quarter of 2026, driven by higher global fuel prices and strong performance across its non-fuel businesses.
Despite the significant increase in revenue, STO’s gross profit fell 4% to MVR 757 million as higher fuel procurement costs compressed margins.
advertisement
Operating profit also declined 12% to MVR 324 million during the quarter, with lower gross profit and increased provisions for receivables impairment contributing to the decline.
We’ve published our 2026 2nd Quarterly Report.https://t.co/5ygDGNwRX4 pic.twitter.com/dvrMEompw7— STO (@stoplc) July 29, 2026
However, STO’s profit before tax rose to MVR 280 million from MVR 276 million in the first quarter, while earnings per share increased from MVR 245 to MVR 248.
The improvement in pre-tax profit came despite higher working capital financing costs, supported in part by dividend income from subsidiaries. STO recorded net finance income of MVR 11 million during the quarter.
STO’s property, plant and equipment increased to MVR 2.93 billion, reflecting capital expenditure on vessels and vehicles. The company also increased investments in financial assets.
The company’s payables rose to MVR 4.89 billion from MVR 4.25 billion in Q1, mainly due to higher procurement costs and fuel volumes. Receivables declined slightly despite increased sales, indicating improved collection and working capital management.
Total equity increased to MVR 6.08 billion, supported by retained earnings generated during the quarter.
STO generated MVR 382 million in net operating cash flow during Q2. Investing activities recorded a net outflow of MVR 267 million, mainly due to capital expenditure and financial asset placements, while financing activities generated a net inflow of MVR 196 million through additional short-term borrowing to support higher inventory purchases.
Cash and cash equivalents increased by MVR 311 million during the quarter, reaching MVR 862 million as of 30 June 2026.
The company’s debt-to-equity ratio increased from 1.84 in Q1 to 1.93 in Q2, while the current ratio declined from 1.39 to 1.30. The debt service coverage ratio also eased from 1.06 to 1.01, indicating a tighter debt servicing buffer.
STO’s Q2 results highlight the impact of higher global fuel prices on both revenue and margins, while stronger non-fuel operations and subsidiary dividends helped support overall profitability.
