PSO powers ahead as profit skyrockets, debt melt away

October 28, 2025 (MLN): Pakistan State Oil (PSO) has posted a remarkable turnaround in its financial performance, with profit after tax (PAT) soaring over fivefold to Rs11.18 billion during the quarter ended September 2025, compared to Rs1.86 billion in the same period last year.

The surge in profitability was underpinned by sustained operational efficiency, robust gross margins, and a sharp reduction in finance costs.

The oil marketing giant’s gross profit jumped 36% YoY to Rs33.73 billion, despite a 6.7% decline in net sales to Rs771.9 billion amid lower product prices.

Improved inventory management, efficient receivable recovery, and controlled operating expenses supported the strong bottom-line growth.

Finance costs nearly halved to Rs6.94 billion, reflecting PSO’s significant debt reduction and improved liquidity position.

PSO’s latest financials also highlight an impressive 105% cash collection during 1QFY26, marking the seventh consecutive quarter where recoveries exceeded 100% of RLNG sales.

Since December 2023, the company’s receivables have fallen by Rs122 billion to Rs426 billion, accompanied by an equivalent Rs122 billion reduction in debt, which now stands at Rs324 billion.

This twin decline in receivables and debt underscores PSO’s concerted efforts to de-leverage and enhance its financial resilience.

The company’s over-100% recovery ratio, particularly in the RLNG segment, reflects strengthened collection systems and improved payment discipline among its clientele.

The consistent improvement in liquidity and balance sheet health not only reinforces PSO’s operational stability but also provides a strong foundation for sustained profitability and future energy investments.

As the energy giant continues to navigate a challenging economic and regulatory environment, analysts and investors view its latest performance as a strong indicator of enduring financial momentum and strategic execution.

The management’s aggressive receivable recovery drive and prudent cost control have positioned the company for sustainable growth amid Pakistan’s evolving energy dynamics.

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