The state-owned exploration company had earned a profit of Rs18.25 billion in the same quarter last year.
Earnings per share stood at Rs3.40 in Jul-Sept 2016 compared to Rs4.25 in the corresponding period of previous year.
The board of directors recommended the first interim cash dividend of Rs1.50 per share. It will be paid to the shareholders whose names will appear in the register of members on December 12, 2016.
Topline Securities, Elixir Research and other brokerage houses commented that the financial result was in line with market expectations.
OGDC’s share price, however, fell 1.27%, or Rs1.82, and closed at Rs140.66 with a volume of 997,900 shares at the Pakistan Stock Exchange.
JS Research analyst Nabeel Haroon linked the decline in the stock price with a downturn in crude oil prices in world markets.
“… the exploration and production sector declined to close in the red zone as crude oil prices continued to trade below $50 per barrel due to recent statements from Iraq and Russia, indicating reservations about reduction in the production level,” he said.
According to the company’s profit and loss account, the exploration and prospecting expenditure increased 140% to Rs4.32 billion from Rs1.80 billion.
Nabeel Khursheed of Topline Securities called the cost surge a positive for the company. “In the absence of any dry wells, we attribute this increase to enhanced geophysical survey and outsourced seismic activity. However, we await management clarity in this regard,” he said.
Sales fell 11% to Rs39.56 billion from Rs44.51 billion mainly on account of 14% year-on-year decrease in Arab Light Crude prices to $43 per barrel during the period, he added.
Oil sales in volumetric terms, however, rose 4% on a yearly basis to 40,000 barrels per day. Gas volumes, however, shrunk 5% to 1,074 million cubic feet per day as per provisional numbers.
Other income showed a substantial jump of 27% to Rs5 billion.
“This was mainly on the back of higher income on account of signature bonus (sale of LPG to marketing companies), which stood at Rs1.5 billion in 1QFY17 compared to Rs273 million in the same period of last year,” the analyst said.
Published in The Express Tribune, October 28th, 2016.
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