Ayesha Mudassar

The Oil and Gas Development Company Limited (OGDCL), Pakistan’s largest exploration and production company, posted a 13% increase in net sales, 3% in gross profit, and 7% in net profit during the nine months (July-March) of the ongoing fiscal year 2024, compared with the corresponding period of the previous fiscal, according to WealthPK.

During 9MFY24, the company pushed its revenue up from Rs309.1 billion to Rs348.1 billion. The growth in OGDC's topline resulted in a 3% growth in gross profit; however, gross margins tumbled from 69% in 1QFY23 to 63% in 1QFY24 due to proportionate increase in operating expense. In addition, the company’s net profit rose by 7% year-on-year (YoY) to Rs171.1 billion as compared to Rs159.6 billion in 9MFY23. The earnings per share (EPS) for the nine months of FY24 stood at Rs39.78, representing a 7% rise compared to the same period last year. The rising EPS suggests an increase in the company’s earnings available to shareholders per share.

Oil and Gas Exploration Sector- 9MFY24

Pakistan's oil and gas exploration sector reported an upsurge of 15% in net sales, 12% in net profit, and 19% in earnings per share over the nine months of current fiscal year compared to 9MFY23. The stellar financial performance was largely boosted by enhanced hydrocarbon sales and higher sales prices during the period. During 9MFY24, the listed oil and gas firms collectively posted a net revenue of Rs765.1 billion, a net profit of Rs349 billion, and earnings per share of Rs567.69. The growth in sales successfully overcame the rise in the sector’s expenditures related to taxes, royalties, other charges, and operation costs.

OGDC made the highest contribution of 45% in the total revenue secured by the sector followed by Pakistan Petroleum Limited (PPL) with a sales contribution of 29% in 9MFY24. Mari Petroleum Company Limited (MARI) with a share of 19% and Pakistan Oilfields Limited (POL) with a share of 7% stood third and fourth in the sector’s total sales.

In terms of net profit, OGDC topped again by earning 49% of the total net profit. PPL and MARI added 27% and 15%, respectively, to the sector’s aggregated net profit in 9MFY24. POL made the lowest contribution of 9% to the net profit.

Company Profile

OGDC, a national oil and gas company of Pakistan, was established in 1961 as a Public Sector Corporation before being converted to a Public Limited Company in October 1997. Its primary operations involve exploration, drilling operation services, production, reservoir management, and engineering support. The company remains steadfast in its commitment to harnessing innovative technologies and best practices to further enhance production capabilities, contribute to the nation’s energy needs, and fuel economic growth.

Future Outlook

Moving forward, OGDC will continue to support all of its stakeholders particularly the Government of Pakistan, the Ministry of Energy, the Board of Directors, shareholders, joint venture partners, and employees for delivering upstream growth. While pursuing the strategic objectives, compliance towards environmental protection, health safety protocols, and fiscal discipline will be pivotal in achieving sustainable business development and success.

Credit: INP-WealthPk