Corporate results: OGDC’s profit falls 31%, remains above market expectations

Company announces profit of Rs59.97b in FY16 compared to Rs87.24b in FY15

KARACHI: Oil and Gas Development Company’s (OGDC) profit was down 31% in fiscal year ended June 30 due to sluggish sales, lower other income and increased exploration expenditure, according to a bourse filing Wednesday.

The company booked a profit of Rs59.97 billion in the year under review as compared to Rs87.24 billion in the preceding year. This translated into earnings per share at Rs13.94 against Rs20.29 last year, the company said in a notification to the Pakistan Stock Exchange.

Board of directors has recommended a final cash dividend at Rs2 per share. The entitlement will be paid to the shareholders whose names will appear in the register of members on October 18, 2016. This will be in addition to interim dividends already paid at Rs3.2 per share.



Brokerage houses including Elixir Research, Invest and Finance Securities and Topline Securities said in their post-result comments that the result announcement was higher than their estimates and stock market expectations.

The company’s share price increased by Rs1.66 and closed at Rs141.82 with a turnover of 881,000 shares.

The rally is partly attributed to the result and the finding of significant oil and gas reserves in Khyber-Pakhtunkhwa by the firm.

Meanwhile, net sales of the firm declined 21% to Rs162.86 billion in the year against Rs210.62 billion in the preceding year.

Accordingly, the gross profit (excluding royalty, operating expenses and transportation charges) fell 33% to Rs87.88 billion from Rs131.96 billion last year.

The other income declined by 23% to Rs14.70 billion from Rs19.18 billion last year.

The exploration and prospecting expenditure rose 25% to Rs14.54 billion from Rs11.62 billion. The finance cost reduced by 33% to Rs1.71 billion from Rs2.55 billion.

The company’s earnings from associated firm doubled to Rs2.18 billion from Rs1.04 billion.

Published in The Express Tribune, August 25^th, 2016.

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