OGDC’s profit falls 9.3% to Rs91.5b

Decline comes on back of drop in finance and other income

KARACHI:

The Oil and Gas Development Company (OGDC) reported a 9.3% contraction in its profit to Rs91.5 billion in fiscal year 2020-21 primarily due to decline in finance and other income.

The oil exploration firm had reported a profit of Rs100.9 billion in fiscal year 2019-20.

Earnings per share of the company declined to Rs21.28 in the year under review compared to Rs23.47 in FY20, according to a notice sent to the Pakistan Stock Exchange (PSX) on Tuesday.

Alongside the result, the company announced a final cash dividend of Rs1.5 per share taking the total dividend during FY21 to Rs6.9 per share.

Net sales of the company inched up from Rs232.9 billion in fiscal year 2019-20 to Rs239.1 billion in fiscal year 2020-21, an uptick of 2.65%.

“The growth in sales comes on the back of hike in oil prices by 3% on a year-on-year basis and increase in oil production by 2% given resurgence in global demand,” said Arif Habib Limited analyst Muhammad Iqbal Jawaid in a report.

The firm’s operating expenses witnessed a rise of 7.42% to Rs70.2 billion in the previous fiscal year. The company had spent Rs65.3 billion under this head in 2019-20.

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Similarly, the transpor-tation charges surged 10% from Rs1.59 billion in FY20 to Rs1.76 billion in the year under review.

The oil company’s exploration cost fell 5% to Rs17.3 billion in the previous fiscal year from Rs18.2 billion during fiscal year 2019-20.

Finance cost also dived to Rs2.2 billion in FY21 against Rs3 billion in FY20.

During the year, finance and other income took a hit as it plunged 60% to Rs14 billion. The company had received Rs33.8 billion under this head in FY20.

“Other income plunged due to fall in interest income from cash and cash balances,” said Iqbal.

General and administrative expenses also decreased from Rs5 billion to Rs4.7 billion in FY21.

During the day, the share price of the oil company
fell by Rs1.23 to close at Rs83.39 with 7.35 million shares changing hands at the PSX.

Published in The Express Tribune, September 29^th, 2021.

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