Business

OGDC’s profit surges 46% to Rs134 billion

Earnings grow due to spike in oil prices coupled with rupee depreciation

Our Correspondent September 24, 2022

This comes at a time when company profits are coming under pressure. PHOTO: fb.com/OGDCL

KARACHI:

Oil and Gas Development Company’s (OGDC) net profit jumped 46% to Rs133.78 billion in the fiscal year ended June 30, 2022, due to a spike in oil prices at the world markets and rupee depreciation, as its volumetric production decreased during the year.

The company had booked a profit of Rs91.53 billion in the prior fiscal year 2020-21, according to the profit or loss accounts dispatched to the Pakistan Stock Exchange (PSX) on Friday.

Accordingly, the earnings per share increased to Rs31.11 in the year under review compared to Rs21.28 in the previous year.

The company’s board of directors recommended a final cash dividend of Rs2.5 per share; this is in addition to the interim dividends already paid at Rs4.75 per share during the year. The new entitlement will be paid to those shareholders whose names will appear in the register of members on October 7, 2022.

OGDC’s share price dropped 0.58% (or Rs0.43) to close at Rs73.33 with a 4.15 million share turnover.

The company’s net sales also surged 40% to Rs335.46 billion the year under review compared to Rs239.10 billion recorded in the prior year.

The sales increased “on account of a surge in oil prices by 71% year-on-year given a resumption of oil demand internationally and Pakistani rupee depreciation against the US dollar by 10% year-on-year,” said Muhammad Iqbal Jawaid, an Analyst at Arif Habib Limited, in a post-result commentary.

“However, oil and gas production dipped by 4% and 6% year-on-year, respectively.”

Oil and gas exploration cost fell 10% to Rs15.58 billion given that five wells were found dry during FY22 compared to eight wells found dry in FY21.

Other income spiked three-time to Rs46.57 billion in FY22, compared to Rs13.97 billion in FY21, “due to recognition of exchange gains,” he said.

In the fourth quarter (April-June FY22) alone, OGDC’s net profit dropped 14% to Rs21.74 billion (earning per share of Rs5.05) “due to the imposition of super tax during the quarter.”

Published in The Express Tribune, September 24^th, 2022.

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