Mari Petroleum (MARI): 4QFY19 EPS Rs62.0, up 64% YoY, Stellar growth (Above expectations)
- Mari Petroleum (MARI) posted a stellar growth of 64% YoY in earnings clocked in at Rs62.0 per share.
- Earnings beat street consensus on the back of lower exploratory and operating expenditures.
- The company posted revenue growth of 32% YoY to Rs15.94bn (vs. our expectations of Rs15.96bn), despite the decline in gas production by around 4% YoY. Higher revenue is attributable to the gradual unwinding of discount applicable on the Mari field coupled with rupee devaluation.
- The exploration cost of Rs735mn was much below our expectations of Rs1.55bn. We expected a higher cost on account of the seismic acquisition of Bannu West and Sukkur block.
- Operating expenditures remained on lower side at US$1.6 per BOE vs. last 8-quarter average of US$1.93. We await for release of annual filings to further look into these accounts.
- Finance income went up to Rs625mn (+126% YoY) during 4QFY19 due to higher rate of return on local deposits.
- Risk: We flag 1) inability to meet set benchmark of incremental production to avail higher pricing, 2) slowdown in demand from customers, and 3) lower than anticipated international oil prices as a key risk to company’s earnings and valuation.
Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.
Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.
Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.
JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).
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