Pakistan OMCs: POL imports drop 29.5% in 4MFY23 Past four months have seen the demand for refined petroleum products drop by 21.6% majorly due to higher pump prices, impact due to floods and an overall economic slowdown. A 29.5% decline in POL product imports was witnessed as well in the first four months (Jul-Oct), compared to SPLY, as quantity imported stood at 6.06mn tons during the period vs. 8.6mn tons during 4MFY22 The drop in global POL consumption is being largely offset by increase...
We raise our E&P estimates on higher assumed oil prices, which we now forecast at USD80/70LT per barrel for FY23/24f, as against USD60/60LT earlier. Our earnings estimates have increased by 10-20% on average for these years and we reiterate our Overweight stance on E&Ps. We believe that government’s efforts to resolve the accumulation of circular debt has been underappreciated where stocks have underperformed oil price by 16% in the last 1 year. More positives have risen from currency devalua...
POL reported 1QFY23 earnings of PKR 8.4bn (EPS: PKR 29.59), similar to the previous quarter but 60% higher than last year. The earnings could have been potentially higher had it not been for the astronomical exploration cost of PKR4.5bn (previous high of PKR2.8bn during 2QFY15). Key highlights: * Net sales jumped 44% YoY to PKR 16.0bn during 1Q as high oil prices and PKR devaluation continued adding towards topline gains. * Operating cost declined 16% QoQ as most workover jobs were carr...
POL announced highest ever annual profit of PKR25.9bn (EPS: PKR 91.37) in FY22, gaining from high oil prices and PKR devaluation. Earnings were highest in 4Q at PKR 8.44bn (EPS: PKR 29.73), where most part of PKR devaluation helped in terms of Fx gains despite super tax, also aiding with a healthy final payout of PKR 50/share. POL conducted a corporate briefing session today to discuss various contours of its FY22 performance and provide outlook. FY22 was a year of lower oil (-11% YoY) and ga...
POL announced highest ever annual earnings of PKR 25.9bn (EPS: PKR 91.37) for FY22 as higher oil prices and PKR devaluation continued to impact positively. The 4Q earnings are also at an all-time high of PKR 8.44bn (EPS: PKR 29.73). High Fx income gains during the quarter kept the effective tax rate at a modest level during the year, where ETR dropped to 30% from 35% last year. The company announced final DPS of PKR 50, in-line with our estimates, taking total payout of FY22 to PKR70/share. ...
* The super tax is expected to reduce earning of E&P Universe by 34% QoQ to PKR46bn despite topline rejoicing from higher oil prices and PKR devaluation during the period. * Both OGDC's and PPL's payout will be impacted by the tax as well as the fine of USD187.5mn each to TCC as the long-standing dispute of Reko Diq was reconstituted. However, POL will likely emerge with a hefty payout of PKR 50.00/share where Fx gains will overcome super tax impact. * We remain positive on the imp...
As per latest PPIS data, overall 2P Gas reserves in Pakistan have declined c.5% to 19.9tcf as of December 2021, down from c.20.95tcf by June 2021. Total 2P Oil reserves have declined c.10% to c.222.9mmbbl, from c.249.0mmbbl as of June 2021. KEY HIGHLIGHTS OF THE CHANGES IN HYDROCARBON RESERVES: * Substantial changes in Oil reserves of OGDC: Total Oil reserves of the fields operated by OGDC have fallen 23% to 82.8mmbbl as of December 2021. Among the large assets, oil reserves of Nashpa, Kunna...
Pakistan Oilfields Ltd (POL) has posted net profits of PKR5.6bn (EPS PKR19.96) for 2QFY22, up 8% qoq and 88% yoy, which is in line with our EPS estimate of PKR20.04. It takes 1HFY22 net profits to PKR10.9bn (EPS: PKR38.48), up 64% yoy. The payout of PKR20.0/sh is also in line with our expectations. KEY HIGHLIGHTS FOR 2QFY22 RESULTS: * Net Sales have clocked in at PKR12.6bn, up 14% qoq and 44% yoy. Oil and gas production were flat qoq at c.5,600bpd and c.72mmcfd, respectively (though down 11%...
HIGHER OIL PRICES TO KEEP EARNINGS ELEVATED * We estimate our E&P cluster to post near-record combined net profits of c.PKR57bn, up 69% yoy (flat qoq), thanks mostly to multiyear high crude oil prices and continuous PKR devaluation. The results should be accompanied by good payouts from all companies. * Compared with the previous quarter, gas production was mostly flat (but up 4% for OGDC), while oil production fell 5% qoq on average due to depletion at major assets across our coverage....
Pakistan Oilfields Ltd (POL PA) has posted an unconsolidated net profit of PKR5.3bn (EPS PKR18.52) for 1QFY22, up 38% qoq and 45% yoy, which is higher than our EPS estimate of PKR17.13. Key deviations from our estimates are lower Opex and Finance cost, but these are partly offset by higher-than-expected exploration and amortization expenses. KEY HIGHLIGHTS FOR 1QFY22: * Net Sales have clocked in at PKR11.0bn, up 22% qoq (20% yoy), where both oil and gas production were higher by a mere 2% qo...
PKR WEAKNESS AND HIGHER OIL PRICES TO ELEVATE EARNINGS * Despite flattish to mildly lower production, our E&P Universe is expected to post cumulative net profits of PKR56.4bn for 1QFY22, up 31% qoq and 36% yoy – thanks to higher oil and gas prices and sharp PKR devaluation. Notably, the incremental earnings emanated largely from PKR weakness. * As per PPIS data, gas production for all three companies in our coverage rose about 3% qoq, even though some large assets depicted sharp decline...
StockSmart Weekly Review In contrast to last week, the outgoing week saw immediate reaction of investors in form of panic selling over Pakistan’s reclassification to MSCI Frontier index. The average daily turnover declined by 6.7%WoW to 400mn shares where as the benchmark KSE-100 index slipped 562pts, declining by 1.2%WoW to close at 46,636pts over rising concerns of the upcoming IMF review and continues decline of PkR-US$ parity where th...
AKD Daily Pakistan Oil & Gas: Cracks depict a mixed trend POL product cracks for 4QFY21 remained mixed - where for HSD, cracks declined to USD3.36/bbl despite underlying crude benchmarks inching higher (Arab Light during the period average at USD76/bbl up 11%QoQ) on the back of increasing demand amid tight supply. RON92 cracks stood at USD4.39/bbl, increasing by 300.5/54.5% YoY/QoQ as individual activity across the major economies increase post improving vaccination rates. To note, average...
Pakistan Oilfields (POL): * POL plans to drill four wells in FY21. This includes an exploratory well in DG Khan and other wells in non-operated blocks of Adhi and Tal. Among these wells, MOL is planning to drill an exploratory well, named Razgir, in the hitherto untapped KOT region of Tal block. * Disruption at Tal block: Mardankhel-4 well continues to be disrupted by security issues, while production of Mamikhel South is contingent on the government's approval for 2012 PP gas price for...
MODERATE CHANGES IN OVERALL HYDROCARBON RESERVES PPIS recently updated the 2P reserves of oil and gas in Pakistan. Overall Gas reserves, by June 2021, are down 1.2% to c.20.95tcf – compared to the level in December 2020. Oil reserves, however, have declined c.6.5% to c.249mmbbl, from c.266mmbbl in December 2020. KEY HIGHLIGHTS OF THE CHANGES IN HYDROCARBON RESERVES: * Significant upgrade at Sui (Operator, PPL): Gas reserves of Sui have been upgraded by 26% from the level in December 2020 to ...
Pakistan Oilfields Ltd (POL) has posted an unconsolidated net profit of PKR3.8bn (EPS PKR13.41) for 4QFY21, up 30% qoq and 57% yoy, in line with our EPS estimate of PKR13.26. This takes the FY21 net profits to PKR13.4bn (PKR47.14/sh), down 18% yoy. POL has also announced a final dividend of PKR30/sh, taking the full-year payout to PKR50.0/sh (payout ratio of 106%), while we had expected a final DPS of PKR22.0. KEY HIGHLIGHTS FOR 4QFY21: * Net sales have clocked in at PKR9.0bn, down 4% qoq bu...
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
We estimate cumulative profits of our E&P Universe to rise by c.12% qoq to PKR43.7bn for 4QFY21, where revenues are expected to grow by c.4% qoq only. The expected earnings growth is majorly driven by the lack of exchange losses and lower exploration expenses. Production growth for the three E&Ps we cover remained divergent during 4Q. OGDC maintained its oil and gas production levels; while PPL and POL saw nearly 5% qoq decline, because of a turnaround at Gambat South and continued depletion ...
A director at Pakistan Oilfields bought 37,000 shares at 384.830PKR and the significance rating of the trade was 57/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years c...
Pakistan Oilfields Ltd (POL) has posted an unconsolidated net profit of PKR2.9bn (EPS PKR10.31) for 3QFY21, down 3% qoq and 46% yoy, much below our EPS estimate of PKR14.8 and consensus expectations. This takes the 9MFY21 net profits to PKR9.6bn (PKR33.74/sh), down 31% yoy. Deviations from our estimate are many: (i) lower revenues, (ii) higher Opex, (iii) greater exchange losses and (iv) abnormally high effective tax rate. KEY HIGHLIGHTS * Net Sales have clocked in at PKR9.5bn, up 8% qoq bu...
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