PSO dominates a challenging energy market

Pakistan State Oil (PSO) exhibited exceptional resilience and reported a net profit of PKR 10.3 billion (9MFY22: PKR 64.8 billion) with Earnings Per Share of PKR 21.9. The company’s strong operational performance and strategic thrust helped increase its market share as it continued to display unyielding perseverance and adaptability in the face of ever-changing market conditions. PSO’s Board of Management reviewed the performance of the company and its subsidiary, Pakistan Refinery Limited (PRL), in the meeting held at the PSO head office in Karachi on April 27, 2023. The group collectively posted a net profit of PKR11.8 billion. Nationally, the petroleum demand for white oil plummeted by 19.6%, coupled with a decline of 17.1% in motor gasoline and 24.9% in diesel sales. Furthermore, there was a marked downturn of 32% in the demand for black oil, mainly attributable to a limited furnace oil-based power generation given the reduced demand for electricity across the country. Despite the myriad of challenges faced by the petroleum industry, PSO exhibited unwavering resilience by achieving consistent growth and resolutely maintaining its leading market position in the white oil category. Through its aggressive market penetration strategy, the company was able to increase its market share by a remarkable 2.9% compared to last year and capture approximately 51% of the industry's total volume. The major contributor was diesel in which the company increased its market share by 4.1%, closing the period at 54.4%. With a firm focus on innovation and technological advancement, PSO effectively leveraged its digital capabilities to stimulate growth and optimize efficiency. In line with this, the organization accomplished its objective of integrating and automating 3 of its terminals, namely Keamari Terminal A (Karachi), Machike (Lahore) and Sihala (Rawalpindi), a crucial step towards realizing a fully digital supply chain. Additionally, PSO further bolstered its oversight and planning capabilities by assimilating 700 new retail outlets into its indigenously developed central control system, consolidating its position as a progressive and forward-looking company. PSO further strengthened its infrastructure by rehabilitating 42,000 tons of existing storage and adding another 90,000 tons which are currently under construction. The company also added 22 new outlets at strategic locations to its retail network extending it to a total of 3,525 outlets. Staying true to its corporate values of Caring and Giving, the company demonstrated its commitment to social responsibility by contributing PKR 316 million towards various CSR initiatives including healthcare and wellbeing, education, environment, and social development during the reviewed period. The Board also expressed concern over the mounting trade receivables, notably the 65% increase in receivables from Sui Northern Gas Pipelines (SNGPL) Limited from March 31, 2022. The management is actively pursuing the matter with the concerned authorities for the recovery of outstanding dues. As the nation’s leading energy company, PSO is committed to fuelling the nation and operating with optimal performance for the remaining part of the year. The management expressess sincere gratitude to all its shareholders, employees and customers for their continued support and trust.