October 26, 2021
The country's most dynamic energy company, Pakistan State Oil (PSO), convened its 45th Annual General Meeting on October 26, 2021 at its head office in Karachi. In light of COVID-19 precautions, the meeting was held virtually to safeguard the health of employees and shareholders.
Chairman, Board of Management (BOM), PSO - Mr Zafar I. Usmani presided over the meeting with Chief Executive Officer & Managing Director PSO - Syed Taha and other BOM members. Senior company officials and the finance team were also present at the meeting.
As economies continued to reel from the impact of the pandemic on a global scale, PSO beat all odds and announced a record breaking gross revenue of PKR 1.4 trillion and highest ever profit after tax of PKR 29.1 billion for the financial year 2020-21 (FY21) after a loss after tax of PKR 6.5 billion in the preceding year. The net profit translated into a healthy earning per share of PKR 62.07 vs. loss per share of PKR 13.77 in FY20.
PSO continued to dominate the energy landscape, exhibiting an outstanding growth of 21.9% in liquid fuels over last year with volumes reaching 9.2 million tons, attaining a market share of 46.3% in FY21 compared to 44.3% in FY20. The company also achieved its highest ever volume of 7.6 million tons in the white oil segment despite the shrinking jet fuel and kerosene oil industry, with a market share of 45.2% in FY21 vs. 44% in FY20 i.e. a growth of 120 basis points (bps).
An all-time high record was also set in motor gasoline achieving volumes of 3.5 million tons, an increase of 21.2% from FY20, translating into market share of 41.3% vs. 38.7% last year - an increase of 260 bps. PSO made a strong closing in Hi-Cetane Diesel as well, achieving a volumetric growth of 21.1% vs. industry growth of 17.5%, translating into volumes of 3.7 million tons in FY21. The volumes contributed in regaining market share, bringing it to 47.2% vs. 45.8% in the preceding year i.e. an increase of 140 bps. PSO attained a volumetric growth of 53.2% in black oil with volumes of 1.7 million tons and a market share of 51.7% vs. 46% in FY20.
With a focus on innovation and technology, PSO continued to enhance its digital capabilities, undertaking numerous pioneering initiatives such as the launch of Pakistan's first digitally integrated oil storage & dispatch terminal in Karachi and becoming the first public sector entity to launch e-procurement through SAP Ariba. In line with GOP's clean and green initiative, PSO was the first OMC to upgrade the country's fuel standard from Euro 2 to Euro 5. PSO's first EV charging facility - Electro was also launched in Islamabad.
The company fast tracked infrastructural projects to gain operational efficiency adding 174,000 tons of new and rehabilitated storages. PSO imported 4.9 million tons of white oil products, an all-time high since the inception of the company and also played a pivotal role in the LNG sector, entering into another agreement with Qatar Petroleum under G2G arrangement to supply an additional 3 million tons of LNG for a period of 10 years.
As a responsible corporate citizen, PSO, through its PSO CSR Trust extended support of PKR 102 million in the fields of healthcare, education, community-building, environment and disaster relief nationwide.
Responding to a query about receivables, CEO & MD PSO informed shareholders that BOM and the company's management are working with GOP on recoveries and PKR 25.8 billion were recovered from the Power Sector along with late payment surcharge income in the preceding year while reducing finance cost by Rs. 3.2 billion (24%).
On a query regarding the company's sustainability, Chairman BOM PSO informed that sustainability is the cornerstone of PSO's long-term corporate strategy as the company transforms into an integrated energy company focused on delivering solutions for customers by harnessing technology, exploring low carbon energy alternatives, diversifying, starting new ventures and redesigning its internal architecture.
Responding to a query about the lubricant business, CEO & MD PSO informed that the company prioritized high margin products in FY21 adding significant revenues with a volumetric growth 11.3% in lubricants. He added that a robust strategy is in place to further enhance the lubricant business in FY22. On a question posed regarding the LPG business, he informed that the company is working with local producers to increase allocation and stimulate volumetric growth.
Based on the outstanding financial and operational performance, the company declared a final cash dividend of PKR 10/- per share (100%) which is in addition to the interim cash dividend of PKR 5/- per share (50%) already paid for financial year 2020-21. The dividend for the financial year stands at PKR 15/- per share (150%).
All the resolutions submitted for shareholders' approval were adopted. The meeting concluded with a vote of thanks to employees, stakeholders, business partners, members of the Board of Management and the Government of Pakistan, especially the Ministry of Energy (Petroleum Division), for their support and guidance.