PPL profit soars 88% as sales grow significantly

Oil and gas exploration firm earns Rs7.10b in Jan-Mar quarter

KARACHI: Pakistan Petroleum Limited’s (PPL) consolidated profit soared 88% to Rs7.10 billion in the quarter ended March 31 on the back of a significant growth in sales, according to a bourse filing on Thursday.

The oil and gas exploration and production company had recorded a profit of Rs3.78 billion in the same quarter of previous year.

Earnings per share (EPS) surged to Rs3.61 in the Jan-Mar quarter from Rs1.92 in the corresponding quarter of last year. PPL’s share price fell 1.81%, or Rs3.04, to Rs164.78 with trading volume of 407,800 shares at the Pakistan Stock Exchange.

The company’s sales rose 31% to Rs24.05 billion from Rs18.38 billion.

“Revenues increased considerably owing to the higher [benchmark] Arab Light Crude price, up 77% year-on-year to $52.5 per barrel, and rise in hydrocarbon production levels,” Topline Securities analyst Nabeel Khursheed said.

Oil production improved 17% to average 17,300 barrels per day, thanks to addition from the Nashpa field (37% of total oil production), up 34%, Adhi field (18% of total oil production), up 16% and additions from Mardankhel and Shadadpur fields (cumulatively 6.5% of total oil production), he said.

Gas production increased 14% to 881 million cubic feet per day (mmcfd) in the quarter with flows from Kandhkot field (23% of total gas production) up 1.9 times to average 202mmcfd and from Shadadpur field (4% of total gas production).

“Although pre-tax profit was up 79%, lower effective tax rate (down 323 basis points to 29%) led to 87% increase in after-tax earnings,” he said.

“We flag long-term volatility in international oil prices, delay in key projects, significant exploration and development costs, unexpected field shutdown and delay in realisation of Sui field pricing as key risks for PPL,” he said.

In nine months ended March 31, the consolidated profit increased 14% to Rs18.12 billion (EPS Rs9.19) from Rs15.85 billion (EPS Rs8.04) in the corresponding period of previous year.

Gas discovered

PPL also announced the discovery of new gas reserves in Sindh. It tested gas flow at 29.2 million standard cubic feet per day at Zafir X-1 well in Gambat South Block in Matiari district of Sindh.

Published in The Express Tribune, April 28^th, 2017.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.