KARACHI: Oil and Gas Development Company Limited’s (OGDCL) profit improved 6% to Rs63.80 billion in fiscal year 2016-17 (FY17) on the back of notable increase in net sales, income from sources other than its core businesses and lower exploration costs, according to a bourse filing on.
The effective tax rate increased to 28.42% (Rs25.34 billion) from 25.50% (Rs20.53 billion) in FY16.
In the preceding fiscal year, the oil and gas exploration and production firm had booked a profit of Rs59.97 billion.
Accordingly, earnings per share enhanced to Rs14.83 from Rs13.94 in the previous year.
The company’s board of directors has recommended a final cash dividend of Rs2 per share. This is in addition to interim dividends already paid at Rs4 per share. The new entitlement will be paid to the shareholders whose names will appear in the register of members on October 18, 2017.
OGDCL’s share price inched up Rs0.06 to Rs154.01 with a volume of 1.19 million shares at Pakistan Stock Exchange (PSX).
Net sales enhanced 5.50% to Rs171.82 billion from Rs162.86 billion last year.
The growth in net sales in rupee-value came from “crude oil production surging by 8% year-on-year and average oil prices rising 19% year-on-year,” Taurus Research said in its post-result comments to its clients.
According to the profit and loss accounts of the firm at PSX the firm booked other income at Rs16.02 billion, up 9% from Rs14.70 billion last year.
The other income is usually derived from company’s bank deposits, equity investment and exchange rates.
“The higher profit is attributable to higher than estimated topline (net sales) and lower than expected exploration cost, despite being partially offset by higher effective tax rate than expected.” Elixir Research analyst Sharoon Ahmed said.
The exploration and prospecting expenditure dropped 9% to Rs13.26 billion from Rs14.54 billion in FY16, according to profit and loss accounts.
The finance cost reduced 12% to Rs1.51 billion from Rs1.71 billion.
Research FCEL added that OGDCL gas production declined to 1,054 million cubic feet per day in FY17.