Karachi: Oil and Gas Development Company Ltd (OGDC) has announced its financial results for FY24, showing a 7% decline in annual Profit After Tax (PAT) despite a more favorable quarter marked by increased oil prices and dividend payouts. The company’s PAT stood at PKR 209 billion with an earnings per share of PKR 48.59 for the year.

According to AKD Securities Limited, the fourth quarter of FY24 saw OGDC posting a PAT of PKR 37.9 billion, which represents a 42% decrease year-over-year and a 21% decline from the previous quarter. The company also declared a final cash dividend of PKR 4.0 per share, bringing the full-year payout to PKR 10.1 per share, which translates to a 20% payout ratio for FY24.

Net sales for the quarter increased by 11% year-over-year to PKR 115.5 billion, largely due to higher average oil prices, which stood at US$87 per barrel. However, a significant reversal in finance and other income, which amounted to PKR 3.2 billion, negatively impacted earnings. This was notably different from the anticipated negative PKR 12.2 billion, primarily due to impairment charges related to government receivables.

The operating expenses in the final quarter surged by 35% compared to the previous quarter, totaling PKR 36.9 billion, with the per barrel equivalent cost rising to US$9.2. Exploration expenses saw a substantial reduction, down 50% year-over-year to PKR 4.0 billion. The company’s effective tax rate (ETR) for the quarter was 30%, resulting in a full-year ETR of 29%.

AKD Securities maintains a ‘BUY’ stance on OGDC stock, with a target price of PKR 180 per share by June 2025, and forecasts a dividend yield of 10% for FY25.