Oil and Gas Development Company Ltd (OGDC) announces Q3 financial results
Insight Research has just released an update on Oil and Gas Development Company Limited’s recent quarterly results. Here are the important points from the OGDC earnings announcement:
Performance Overview
In the third quarter of fiscal year 2024 (3QFY24), Oil and Gas Development Company Limited (OGDC PA) reported a Profit After Tax (PAT) of approximately PKR47.8 billion, translating to an Earnings Per Share (EPS) of PKR11.1. This represents a 26% decrease year-over-year (YoY) from PKR64.6 billion (EPS: PKR15.0) in the same period last year. The decline was primarily driven by lower other income and muted foreign exchange (FX) gain. However, the result surpassed expectations, largely due to lower operating costs and higher other income than anticipated.
Revenue Growth
Despite challenges, OGDC recorded a 6% YoY increase in revenue for 3QFY24, attributed to PKR devaluation and increased oil production. However, revenue declined by 2% sequentially (quarter-over-quarter, QoQ) due to lower oil prices.
Cost Analysis
Operating costs surged by 32% YoY to approximately PKR26.8 billion in 3QFY24. However, there was an 18% QoQ decrease in operating costs, reflecting operational efficiencies during the quarter.
Other Income Fluctuations
OGDC experienced a notable 54% YoY decline in other income, totaling around PKR17.3 billion, mainly due to the absence of FX gains recorded in the same period last year. Nevertheless, other income increased by 57% QoQ, showing a positive trend.
Exploration Expenses and Taxation
Exploration expenses decreased by 18% YoY in 3QFY24, likely attributed to no dry well expenses during this period. The taxation charge for the quarter stood at 41.2%, compared to 35.2% YoY and -2.9% QoQ. It’s noteworthy that OGDC recorded a tax reversal in 2QFY24 due to a one-off tax adjustment of depletion allowance.
Dividend Announcement
In addition to the financial results, OGDC announced a cash dividend of PKR2.0 per share for 3QFY24, bringing the total cash dividend for the first nine months of fiscal year 2024 (9MFY24) to PKR6.1 per share, compared to PKR5.8 per share in the same period last year.
| OGDC – PKRmn | 3QFY24 | 3QFY23 | 2QFY24 | YoY | QoQ | 9MFY24 | 9MFY23 | YoY |
|---|---|---|---|---|---|---|---|---|
| Net Sales | 112,789 | 105,913 | 115,234 | 6% | -2% | 348,164 | 309,148 | 13% |
| Royalty | 12,975 | 12,654 | 13,798 | 3% | -6% | 40,426 | 36,129 | 12% |
| Operating Costs | 26,799 | 20,338 | 32,550 | 32% | -18% | 87,244 | 59,629 | 46% |
| Transportation Charges | 654 | 590 | 674 | 11% | -3% | 1,937 | 1,345 | 44% |
| Gross Profit | 72,361 | 72,330 | 68,212 | 0% | 6% | 218,557 | 212,044 | 3% |
| Other Income | 17,271 | 37,446 | 11,018 | -54% | 57% | 44,540 | 65,184 | -32% |
| Exploration Expenses | 3,475 | 4,246 | 2,395 | -18% | 45% | 8,501 | 10,895 | -22% |
| Admin Expenses | 1,915 | 1,600 | 2,432 | 20% | -21% | 6,546 | 3,865 | 69% |
| Finance Cost | 1,821 | 1,201 | 1,750 | 52% | 4% | 5,253 | 3,485 | 51% |
| Profit Before Tax (PBT) | 81,286 | 99,772 | 72,141 | -19% | 13% | 239,601 | 252,621 | -5% |
| Taxation | 33,478 | 35,145 | -2,117 | -5% | N/A | 68,498 | 92,981 | -26% |
| Profit After Tax (PAT) | 47,808 | 64,627 | 74,258 | -26% | -36% | 171,104 | 159,640 | 7% |
| Earnings Per Share (EPS) | 11.1 | 15.0 | 17.3 | – | – | 39.8 | 37.1 | – |
| Dividend Per Share (DPS) | 2.0 | 1.8 | 2.5 | – | – | 6.1 | 5.8 | – |
Disclaimer
The information in this article is based on research by Insight Research. All efforts have been made to ensure the data represented in this article is as per the research report. This report should not be considered investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.
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