Pakistan Oilfields Limited (POL) and Pakistan Petroleum Limited (PPL) will announce FY15 results on Thursday, August 13, 2015 and Monday, August 24, 2015 respectively.

Earnings of POL and PPL are expected to plunge for FY15 as well as for 4QFY15. Declining trend of crude oil prices is likely to pull earnings down significantly for FY15 and 4QFY15. Furthermore, imposition of an additional 3% super tax on earnings for FY15 is expected to plunge earnings downwards as well. We expect POL to post earnings of PKR 1,475m (EPS: PKR 6.23) and to payout PKR 20/share for 4QFY15. Further, we expect PPL to post earnings of PKR 5,743m (EPS: PKR 2.91) and to payout PKR 3.5 /share for 4QFY15.

POL: FY15 EPS expected at PKR 37.38; 4QFY15 EPS expected at PKR 6.23:

Pakistan Oilfield Limited (POL) will announce its FY15 results on Thursday, August 13, 2015. We expect the company to post profit after tax of PKR 8,842mn (EPS: PKR 37.38) for FY15, down by 31.4%YoY as compared to PKR 12,887mn (EPS: PKR 54.48) for FY14. On Quarterly basis, 4QFY15 earnings of POL are estimated to stand at PKR 1,475mn (EPS of PKR 6.23) down substantially by 47% as compared to the PKR 2,785mn (EPS of PKR 11.77) for the same period last year. We expect POL to announce a cash dividend of PKR 20/share taking FY15 total payout to PKR 35/share.

POL’s topline is expected to decline substantially by 29.7%YoY to PKR 6,528mn for 4QFY15 and 13%YoY for FY15 due to the declining trend in crude oil prices. Gross profit for 4QFY15 is expected to decline by 30.9%YoY to PKR 3,015 mainly due to surge in operation cost by 9.6%YoY to 2,231mn. Finance cost is expected to decrease by 27.6%YoY to 160mn and other income is expected to increase by 44%YoY to 289mn for 4QFY15.

Furthermore, Earning for 4QFY15 is expected to plunge owing to increase in exploration cost by 67.7%YoY to 480mn. Due to the face of lower oil prices. We have incorporated the impact of 3% super tax on profit before tax for the whole year in the last quarter earnings calculation, owing to which we are expecting POL to book additional amount of PKR 373mn in taxes, reducing EPS by PKR 1.58.

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