PSO FY26 profit surges over 2x

September 25, 2026 (MLN): Pakistan State Oil Company Limited (PSX: PSO) reported a 2.2x surge in its consolidated net profit for the fiscal year ended June 30, 2026, reaching Rs31.58bn compared to Rs14.24bn in the preceding year.

Alongside the financial results, the board recommended a final cash dividend of Rs10 per share.

Reflecting this bottom-line performance, basic and diluted earnings per share (EPS) for the year expanded to Rs54.29, up from Rs35.03 in FY25.

The primary catalyst behind the performance was a 37% expansion in gross margins alongside a significant reduction in debt-servicing costs.

Net sales dipped slightly by 3% year-on-year to Rs3.21trn, compared to Rs3.32trn in FY25.

However, a 4% contraction in the cost of products sold (falling to Rs3.08trn) enabled gross profit to expand to Rs133.25bn compared to Rs97.15bn in the prior year.

On the operational front, overheads expanded across major heads.

Distribution and marketing expenses rose 8% to Rs23.81bn, administrative expenses grew 16% to Rs10.44bn, and other expenses expanded 27% to Rs8.35bn.

Coupled with a 25% drop in "other income" (Rs18.31bn), operating overheads rose to Rs42.59bn.

Below the operating line, PSO gained significant debt-servicing relief.

Finance costs plummeted by 21% to Rs29.71bn (down from Rs37.41bn in FY25). Driven by gross margin gains, lower finance charges, and a 46% reduction in statutory levies/minimum tax differentials (falling to Rs7.34bn), profit before taxation surged 116% to Rs71.80bn.

The company absorbed a higher corporate taxation charge of Rs40.22bn for the year (up 111% from Rs19.03bn in FY25).

Supported by 37% gross margin growth, a 21% cut in borrowing charges, and reduced statutory levies, Pakistan State Oil Company Limited securely closed the fiscal year with its consolidated net profit reaching Rs31.58bn.

PSO's receivables fell by Rs40bn on a quarter-on-quarter basis as of June 2026, with the recovery ratio standing at 105% for the fourth quarter of FY26, reflecting an improvement in the company's collection efficiency during the period.

On a cumulative basis, receivables have shrunk by Rs133bn since December 2023  the last time gas prices were revised  bringing the outstanding balance down to Rs415bn as of June 2026.

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