Oil and Gas Development Company Limited (OGDCL), Pakistan’s largest exploration and production (E&P) company, reported a profit-after-tax (PAT) of Rs41.44 billion for the quarter ended December 31, 2024 (2QFY25), reflecting a 44% year-on-year decline from Rs74.26 billion in the same period last year.
According to the company’s latest financial statements released on Friday, earnings per share (EPS) dropped to Rs9.63, compared to Rs17.27 in the same period of the previous year (SPLY). The decline in earnings was primarily driven by lower sales and a higher tax burden during the quarter.
Despite weaker profits, the board of directors approved an interim cash dividend of Rs4.05 per share (40.5%), in addition to an earlier interim dividend of Rs3 per share (30%) announced earlier in FY25.
OGDCL’s net sales declined by nearly 13% YoY to Rs100.4 billion in 2QFY25, compared to Rs115.2 billion in the same period last year. This drop in revenue weighed on the company’s gross profit, which fell by 10% to Rs61.6 billion.
Adding to cost pressures, exploration and prospecting expenses surged by over 68% YoY, further straining the company’s earnings. Additionally, OGDCL’s share of profit from associates fell by 57%, reaching Rs1.4 billion from Rs3.3 billion in SPLY.
Despite the earnings drop, the company benefited from a sharp 89% surge in other income, which rose to Rs20.86 billion in 2QFY25 from Rs11.02 billion in SPLY.
Moreover, OGDCL’s profit margin improved to 61.3%, compared to 59.2% last year, reflecting operational efficiency despite revenue contraction.
OGDCL’s profit before tax stood at Rs72.7 billion, reflecting a marginal 1% increase from Rs72.1 billion in the same period last year. However, the company paid Rs31.3 billion in taxes during the three-month period, significantly reducing its net earnings.
OGDCL was incorporated on October 23, 1997, following the corporatization of the state-run Oil and Gas Development Corporation, which was originally established in 1961. The company remains Pakistan’s largest E&P firm, responsible for exploring, developing, and producing oil and gas resources across the country.
