OGDC’s profit soars 89% during Jan-Mar

Net sales rise 25% to Rs45.54b from Rs36.52b

KARACHI: Oil and Gas Development Company’s (OGDC) profit soared 89% to Rs17.58 billion in the quarter ended March 2017 on the back of increased net sales and a notable reduction in the cost of finding new oil and gas reserves, according to a bourse filing on Friday.

The oil and gas exploration and production firm had recorded a profit of Rs9.29 billion in the same quarter of previous year.

Earnings per share (EPS) surged to Rs4.09 in Jan-Mar 2017 from Rs2.16 in the corresponding period of 2016.

The board of directors recommended an interim cash dividend of Rs1.25 per share, which was in addition to the Rs2.50 per share already paid during the ongoing year.

The new entitlement will be paid to the shareholders whose names appear in the register of members on June 15 this year.

OGDC’s stock price improved 0.61%, or Rs0.96, to Rs156.82 with a volume of 2.14 million shares at the Pakistan Stock Exchange (PSX).

Net sales rose 25% to Rs45.54 billion from Rs36.52 billion, according to the profit and loss account sent to PSX.

Market view

Topline Securities’ analyst Nabeel Khursheed said the growth came mainly on the back of higher price of the benchmark Arab Light crude, up 77% to $52.5 per barrel, uptick in hydrocarbon production and normalisation of exploration charges.

“During the quarter, oil volumes improved 11.7% to average 46,800 barrels per day, thanks to additional flow from Nashpa field (30% of OGDC’s total oil production), which contributed incremental production of 3,600 barrels per day,” he said.

In the case of gas production, increased flow from Uch field, up 24% to average 319 million cubic feet per day (mmcfd), lifted OGDC’s output by around 7%, standing at 1,119 mmcfd during the Jan-Mar quarter, he said.

Exploration charges were considerably down by 63% in the quarter under review. “In the corresponding period of last year, exploration charges were significantly higher on the back of aggressive exploration activities,” he said.

In the nine months ended March 31, OGDC’s profit increased 9% to Rs47.59 billion (EPS Rs11.07) from Rs43.49 billion (EPS Rs10.11) in the corresponding period of previous year.

Published in The Express Tribune, April 22^nd, 2017.

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