Pakistan Oil Fields Ltd Reports 9% Decrease in Profits for Q1 FY21

Pakistan Oilfields Limited (POL) announced its results for the first quarter of FY 2020-21

The company registered a decline of 9.5% in its profit to Rs. 3.628 billion for the quarter, as compared to Rs. 4 billion in the corresponding period last year. The company didn’t announce any final cash dividend for the month of September 30, 2020

The drop in profitability was due to lower Arab Light prices along with reduced oil and LPG production. However, higher dollar indexation and growth in gas production has provided some support to profitability.

Brokerage Arif Habib Limited in their research note said,

The net sales in 1QFY21 dropped by 9.44% year on year, clocking-in at Rs. 9.21 billion in contrast to Rs. 10.17 billion during the same period last year on the back of a 2% year on year decline in oil and gas production each and 24% year on year plunge in average realized oil prices owed to weak oil demand internationally.

The exploration costs declined by a massive 80% to Rs. 76 million as compared to Rs. 376 million in the same period last year amid a fall in seismic activity during the period vis-à-vis higher seismic activity at TAL Block in SPLY, it added.

Other income during the period under review was reported at Rs. 303 million as compared to Rs. 467 million in the same period last year, down 35 percent year on year, on account of exchange loss on foreign currency rates.

Earnings per share of the company decreased to Rs. 12.78 as compared to Rs. 14.12.

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