Pakistan Oilfields Limited (POL) announced financial results for 3QFY20 wherein the company posted earnings of PKR5.4bn (EPS: PKR18.95), up 64% YoY and 18% QoQ, exceeding expectations on account of higher other income. This takes 9MFY20 profitability to PKR13.9bn (EPS: PKR49.13) up by 25% YoY.

Total revenue for the quarter stood at PKR10.7bn, down by 6% on QoQ basis, as average oil prices tapered by 19% QoQ sequentially. On a YoY basis, however, revenues inched up by 1% YoY largely supported by a weaker PKR that depreciated by 12% YoY while output of oil saw a decline 8% YoY.

Lower operating expenses and amortization charge led to 10% YoY uptick in gross profitability.

Exploration expenses were reported at PKR0.4bn, down 13/67% QoQ/YoYin the absence of dry well during the period. Overall exploration expenditure dropped 40% YoY during 9MFY20.

Other income saw a 2.9x YoY rise during the period to resid eat PKR2.5bn as the company likely booked exchange gains.

As a result, profits for 3QFY20 soared 18/64% QoQ/YoY clocking-in at PKR5.4bn.

For 9MFY20, lower oil prices (down 13% YoY) predominantly kept the topline in check despite PKR devaluation. Revenues were recorded at PKR32.4bn, down 1% YoY. Dip in operating expenses by 10% YoY and exploration expenses by 40% YoY mainly helped bolster profits. (BMA research).