Oil and Gas Development Company’s (OGDC) profit after tax soared 87% to Rs35.3 billion in October-December 2021 owing to an exponential surge in other income.
According to a notice sent to the Pakistan Stock Exchange, the oil and gas exploration firm had reported a profit of Rs18.9 billion in the same period of 2020.
Earnings per share of the company rose from Rs4.39 in the October-December quarter of 2020 to Rs8.20 in the quarter under review.
In addition to the result, the company announced a cash dividend of Rs2 per share, which took the total payout to Rs3.75 per share in the first half of fiscal year 2021-22.
Net sales of the enterprise rose to Rs79.6 billion in October-December 2021 against Rs54.6 billion in the same quarter of 2020, a jump of 46%. Arif Habib Limited analyst Muhammad Iqbal Jawaid said that net sales climbed up on account of 83% year-on-year hike in oil prices and 8% year-on-year rupee depreciation against the dollar.
“On the other hand, gas production registered a dip of 2% year-on-year,” he said.
The firm witnessed 8% uptick in its operating expenses that rose from Rs16.4 billion in the October-December quarter of 2020 to Rs17.8 billion in the same period of 2021.
During the quarter under review, OGDC’s transportation charges came in at Rs654.7 million, which was 7.94% higher than Rs606.5 million in the same quarter of previous year.
Exploration cost skyrocketed 103% to Rs4.6 billion. The company had paid Rs2.3 billion under the same head in the corresponding period of 2020.
The exploration cost swelled owing to a dry well (Seni Gumbat) found during the quarter, the analyst said.
Other income of the company recorded a big jump as it increased from Rs639.7 million in October-December 2020 to Rs10.4 billion in the same period of 2021.
“Other income in 2QFY22 inflated 16 times year-on-year given exchange gain on currency devaluation tagged with higher interest income on cash and cash equivalents,” said the analyst.
Published in The Express Tribune, February 24th, 2022.
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