AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Karachi: Pakistan Petroleum Limited (PPL) reported a decrease in its earnings for the first quarter of the fiscal year 2026, with earnings per share (EPS) falling 15% year over year to Rs7.38. The decline was primarily attributed to reduced hydrocarbon production.
The company’s net sales for the quarter were Rs56.8 billion, marking a 14% drop compared to the same period last year. However, there was a 10% increase from the previous quarter, likely due to a rise in crude oil prices, which averaged $71 per barrel in the first quarter of FY26, up from $69 in the fourth quarter of FY25. Sequentially, PPL’s oil and gas volumes increased by 6% and 7%, respectively.
Exploration expenses saw a significant decline, dropping to Rs633 million, a 58% reduction year over year and 84% quarter over quarter. This decline was attributed to the absence of dry well costs during the quarter.
Operating expenses for the quarter were recorded at Rs13.7 billion, an 8% decrease from the previous year. The reduction was linked to a decline in hydrocarbon production and sales amid curtailment. The operating expense per barrel of oil equivalent (BOE) stood at $5.05, compared to $7.84 in the first quarter of FY25 and $4.36 in the fourth quarter of FY25.
Other income also fell by 68% year over year to Rs2 billion, influenced by lower interest rates. On a quarter-over-quarter basis, other income decreased by 57%, likely due to exchange losses following the appreciation of the Pakistani rupee from Rs283.76 to Rs281.32 against the US dollar.
The effective tax rate for the quarter was 35%, down from 39% in the first quarter of the previous fiscal year but higher than the 32% recorded in the fourth quarter of FY25.
PPL also announced a cash dividend of Rs2 per share for the quarter, translating into a payout ratio of 27%, up from 23% in the same quarter last year.
Analysts maintain a “buy” stance on PPL, noting that the company is trading at an estimated price-to-earnings ratio of 7.3x for FY26 and 6.3x for FY27.