AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Islamabad: Oil and Gas Development Company Ltd (OGDC) declared its highest ever cash dividend despite a 19% year-on-year decline in annual earnings. The company reported earnings of PkR40.3 billion (EPS: PkR9.37) for the fourth quarter of fiscal year 2025, a 6% increase compared to the same period last year. This slightly surpassed analyst forecasts, primarily due to a lower effective tax rate. Full-year earnings reached PkR169.9 billion (EPS: PkR39.50). A final cash dividend of PkR5.0 per share was announced, bringing the total fiscal year 2025 payout to PkR15.05 per share (38% payout ratio), up from PkR10.10 per share in fiscal year 2024.
Net sales for the fourth quarter decreased by 22% year-on-year to PkR90.3 billion, mainly due to lower hydrocarbon output and a decline in average oil prices. Oil production dropped by 12% to 28.7 thousand barrels per day, while gas production fell by 11% to 637 million cubic feet per day.
Operating costs decreased by 3% to PkR35.8 billion. Exploration expenditures increased slightly by 1% to PkR4.1 billion, driven by drilling activities at Bettani Deep-1, Baragzai X-1, Faakir-1, and Chak263-1, along with 2D and 3D seismic surveys. Finance income experienced a significant turnaround, reaching PkR17.1 billion compared to a loss of PkR3.2 billion in the same period last year, primarily due to the absence of a loss on modification of TFC receivables recorded in the previous year.
Cash and short-term investments decreased by 21% year-on-year to PkR206 billion. Trade receivables saw a continued downward trend, ending the quarter at PkR614 billion, down 3% compared to the same period last year. Gas revenue collection for the fiscal year is estimated at 110%, a substantial improvement from 75% in fiscal year 2024. The effective tax rate for the fourth quarter was 28%, resulting in a full-year rate of 39%. AKD Securities maintains a ‘BUY’ rating on OGDC with a December 2025 target price of PkR371 per share and a 7% dividend yield forecast for fiscal year 2026.