Karachi: Pakistan Petroleum Limited (PPL) announced a notable increase in its annual earnings for fiscal year 2024, despite facing higher operating costs in the fourth quarter. The company’s full-year earnings reached PkR115.4 billion, reflecting a 19% year-on-year growth, with a final cash dividend of PkR2.50 per share.

According to AKD Securities Limited, PPL’s fourth-quarter earnings were marked by a 12% increase compared to the same period last year, totaling PkR17.85 billion. This rise came amidst the implementation of a retrospective super tax that had impacted earnings in the prior year. The fourth quarter also saw a final dividend, culminating in a total annual payout of PkR6.0 per share, which is double the payout ratio from the previous year.

However, the fourth quarter earnings were dampened by a 24% year-on-year decline when excluding tax impacts. This was primarily due to lower revenues, which dropped by 11% year-on-year to PkR64.7 billion, and heightened operating expenses that escalated by 30% to PkR17.3 billion. The decrease in revenues was partly attributed to potential adjustments in Sui gas volumes and a decrease in production due to supply disruptions in the domestic network, which are still under review for further clarity.

Other income for the quarter showed a significant increase, driven by higher returns on financial assets, contributing positively to the quarter’s financial results. The company’s effective tax rate for the quarter stood at 36%, with the full-year rate at 28%.

AKD Securities maintains a ‘Buy’ rating on PPL’s stock, with a target price of PkR155 per share by June 2025, indicating a 34% potential upside from its last closing price.