PSO’s Q1 profit soars 17-fold on higher sales, margins

KARACHI: Pakistan State Oil Co Ltd (PSO), the country's largest oil marketing company, reported a more than 17-fold increase in its net profit for the first quarter of the current fiscal year ending September, driven by higher sales and improved margins.

The company posted a net profit of Rs21.89 billion rupees for the July-September period, compared with Rs1.198 billion in the same period last year, according to a statement issued on Friday.

Earnings per share rose to 46.62 rupees from 2.55 rupees a year earlier. "PSO has showcased its unwavering determination and resilience by achieving remarkable milestones in the first quarter of the financial year 2023-2024. In this period, PSO reported an unprecedented quarterly profit after tax of Rs21.89 billion, resulting in an impressive earnings per share of Rs46.62," the statement said. "Additionally, PSO achieved its highest ever quarterly gross sales of Rs976 billion.

The statement said the company's Board of Management (BoM) reviewed the group’s performance for the first quarter ended September 30, 2023. The group also posted its highest ever Q1 net profit after tax of Rs23.99 billion, translating into earnings per share of Rs51.10.

PSO said it increased its market share in the white oil segment, which includes diesel and gasoline, by 4.3 percentage points to 53.1 percent, despite a decline in product consumption due to inflation, slow growth, and rising oil prices.

Notably, PSO’s market share in diesel and gasoline increased by 4.5% and 4.2% respectively, reaching 55.0 percent and 47.9 percent. "The black oil segment faced a challenging quarter with a 63 percent decline in sales due to low furnace oil-based power generation, however, PSO maintained its leadership in black oil segment with a market share of 29.6 percent at the end of the quarter."

PSO rehabilitated 24 thousand tons of existing storages at Sihala and Zulfiqarabad during the period in an effort to further strengthen the company’s robust supply chain and infrastructure. Additionally, the construction of 91 thousand tons of new storages is currently underway at Faqirabad, Faisalabad, and Mehmoodkot.

"PSO utilised its digital capabilities to propel growth and enhance operational efficiency by successfully automating an additional 2 terminals at Mehmoodkot and Shikarpur, taking the total to 5," the statement added.

The statement said the company's board is actively engaged in settlement discussions with the pertinent authorities to address challenges posed by mounting trade receivables, high borrowing costs, and escalating finance costs.

"The company aims to achieve this through a multifaceted approach, including digitization and automation, process re-engineering, bolstering operational reliability and capacity, enriching customer experience with value-added services, and generating shareholder value through long-term strategic projects and plans."

During the period, the company contributed over Rs30 million to various CSR initiatives focused on healthcare, education, environment, community building, and disaster relief.