POL H1FY25 earnings down 42%

KARACHI: Pakistan Oilfields Limited (POL) announced its financial results for the first half of fiscal year 2025 (H1FY25) on Monday, reporting a profit after tax of Rs10,142 million, with an earnings per share (EPS) of Rs35.73. This represents a significant year-on-year (YoY) decline of 42 per cent, primarily due to higher exploration expenses associated with a dry well during the period.

On a quarterly basis, the company’s net profit for the second quarter of fiscal year 2025 (2QFY25) amounted to Rs7,573 million, with an EPS of Rs26.68, marking a 4.0 percent YoY decrease. Alongside the financial results, POL declared an interim cash dividend of Rs25 per share for Q2FY25, consistent with the dividend issued during the same period last year.

During H1FY25, net sales experienced an 11 per cent YoY decline, settling at Rs30,283 million compared to Rs34,046 million in the same period last year (SPLY). The decline in sales was attributed to a 5.0 percent and 9.0 per cent YoY reduction in oil and gas production, respectively, a 14 per cent YoY drop in average realized oil prices, and a 3.3 percent YoY appreciation of the Pakistani rupee against the US dollar.

In Q2FY25, topline revenues fell by 15 per cent YoY to Rs14,832 million, driven by a 17 per cent YoY decline in average realised oil prices and a reduction of 4 percent and 14 percent YoY in oil and gas production, respectively.

Exploration costs soared sevenfold YoY in H1FY25, reaching Rs8,361 million, largely due to the high costs associated with the dry well Balkassar Deep 1A incurred in the first quarter of FY25. In Q2FY25, exploration expenses stood at Rs626 million, reflecting a 51 percent YoY increase, attributed to higher geological and geophysical costs.

On a positive note, other income witnessed an 8 percent YoY increase, reaching Rs8,372 million in H1FY25, primarily due to higher income generated from cash and cash equivalents, reflecting an improved cash position. In Q2FY25, other income surged by 61 per cent YoY to Rs4,626 million due to the same factors. The company’s effective tax rate stood at 37 per cent in Q2FY25, compared to 39 per cent in Q2FY24.