Pakistan State Oil Company Limited (PSO) is scheduled to announce its 9MFY23 financial result on 27th Apr’23, where we expect the company to post a profit after tax of PKR 10,960mn (EPS: PKR 23.34), down by 83% YoY.

The gross margins are projected to plunge by 396bps YoY to 2.02% amid inventory losses during 9MFY23. In addition to this, sales volume of petroleum products plummeted by 20% YoY (MS, HSD, and FO down by 15%, 19%, and 45% YoY, respectively).

On a quarterly basis, the net profit is expected to reduce by 56% YoY owed to fall in inventory gains. Gross margins are anticipated to settle at 4.86% in 3QFY23 against 7.73% in SPLY given lower offtake in lieu of higher retail prices of MS and HSD coupled with lower inventory gains (clocking in at ~PKR 5.9bn during the quarter). The overall sales volumes plummeted by 28% YoY in 3QFY23.

On a QoQ basis, the company’s profitability turned green one more time owing to i) revision in OMC margins of MS and HSD, and ii) increase in ex-refinery prices (resulting in inventory gains in 3QFY23 compared to inventory loss in 2QFY23).

Courtesy- AHL Research