POL:
Pakistan Oilfields Limited is scheduled to announce its financial results for the period soon, where we expect the company to post a profit after tax of PKR 17,577mn (EPS: PKR 61.92), reflecting a massive decline of 41% YoY. The decrease in the bottom line comes amid: i) hefty exploration costs booked in 1QFY25 due to the high cost of the dry well Balkassar Deep 1A, ii) an 8% YoY decline in average realized oil prices, and iii) a 2% YoY appreciation of the Pak Rupee against the greenback. During 3QFY25, profitability is expected to reach PKR 7,436mn (EPS: PKR 26.19), marking a significant 40% YoY decline. The drop in earnings is attributed to: i) the reversal of the provision for depletion allowance in 3QFY24, ii) a 2% YoY fall in average realized oil prices, and iii) a 7% and 18% YoY reduction in oil and gas production, respectively. Moreover, we anticipate increasing exploration costs by 40% YoY due to higher seismic activity during the period.
MARI:
Mari Energies Limited (MARI) is expected to post earnings of PKR 45,790mn (EPS: PKR 38.14) in 9MFY25, compared to PKR 51,629mn (EPS: PKR 43.00) in 9MFY24, marking an 11% YoY decline. This reduction in profitability is attributable to i) a 2% YoY decrease in the wellhead price of the Mari gas field, ii) the imposition of incremental royalty on the wellhead revenue from the Mari D&P Lease, and iii) appreciation of the PKR against the USD.
On a quarterly basis, net profit for 3QFY25 is projected to rise by 9% YoY, amounting to PKR 15,395mn (EPS: PKR 12.82). The increase in earnings is driven by the higher cost of exploration in the SPLY, which offset the impact of the incremental royalty imposed on the wellhead value of the Mari D&P Lease. Moreover, oil production decreased by 5% YoY, while gas production registered a 9% YoY increase during the quarter. The exploration costs are expected to plunge by 93% YoY to PKR 1,146mn in 3QFY25, owing to higher prospecting expenditure booked in the SPLY.
OGDC:
Oil & Gas Development Company Limited (OGDC) is expected to announce its financial results for 9MFY25 in a few days, where we project earnings of PKR 129,501mn (EPS: PKR 30.11), depicting a decline of 24% YoY. The decrease in revenues is anticipated due to:
i) a 4% and 8% YoY reduction in oil and gas production, respectively, ii) a 10% YoY decline in oil prices, and iii) depreciation of the USD against the PKR. On a quarterly basis, net profit is estimated to clock in at PKR 47,044mn (EPS: PKR 10.94) in 3QFY25, compared to PKR 47,239mn (EPS: PKR 11.12) in 3QFY24, showcasing a dip of 2% YoY. This decline in profitability is primarily attributed to a 4% and 13% YoY reduction in oil and gas production, respectively, coupled with a 6% YoY fall in oil prices. The exploration costs are projected to contract by 13% YoY, reaching PKR 3,024mn in 3QFY25 amid lower costs associated with the dry well (Chak 202-2) incurred during the quarter. Alongside the results, we expect the company to announce a cash dividend of PKR 5.00/share, bringing the total dividend for 9MFY25 to PKR 12.05/share.
PPL:
In the financial results for 9MFY25, Pakistan Petroleum Limited (PPL) is expected to report a net profit of PKR 78,664mn (EPS: PKR 29.91), compared to PKR 96,411mn (EPS: PKR 35.43) in 9MFY24, reflecting an 18% YoY decline. The drop in earnings comes on the back of i) a 10% and 7% YoY fall in oil and gas production, respectively, ii) lower oil prices, and iii) ~2% YoY dip in the wellhead price of Sui. During 3QFY25, profitability is expected to remain stable at PKR 27,751mn (EPS: PKR 10.20). The topline declined by 14% YoY amid a 10% and 4% YoY reduction in oil and gas production, respectively, along with a drop in oil prices. The exploration expenses are projected to decrease by 62% YoY in 3QFY25 due to the absence of a dry well during the quarter. In addition to the results, we expect the company to announce a cash dividend of PKR 2.50/share, taking the total payout for 9MFY25 to PKR 6.50/share.
Courtesy – AHL Research
