KARACHI: Pakistan Petroleum Limited (PPL) reported a 26 percent year-on-year (YoY) decline in earnings for the second quarter of FY26, with profit after tax clocking in at Rs20.3 billion, broadly in line with market expectations. On a quarter-on-quarter (QoQ) basis, earnings remained largely flat, edging up 1 percent.
The YoY drop in profitability was primarily attributed to lower hydrocarbon production and softer oil prices during the period.
For the first half of FY26, cumulative earnings stood at Rs40.4 billion, marking a 21 percent YoY decline.
Net sales for 2QFY26 were reported at Rs61.2 billion, reflecting a marginal 1 percent YoY increase and an 8 percent rise compared to the previous quarter. The sequential improvement was driven by a modest recovery in oil and gas production volumes.
Royalty expenses amounted to Rs9.0 billion during the quarter, remaining flat YoY while increasing 5 percent QoQ. Royalty expense accounted for 15 percent of net sales, consistent with previous quarters.
Exploration costs fell sharply by 74 percent YoY to Rs1.3 billion, largely due to the absence of a dry well expense that had impacted the same quarter last year.
Operating expenditures (OPEX) rose significantly to Rs16.1 billion, up 32 percent YoY and 18 percent QoQ. On a per-barrel-of-oil-equivalent (BOE) basis, OPEX increased to US$5.7, compared to USD4.9 in 1QFY26 and USD5.1 in 2QFY25.
Other income declined 59 percent YoY to Rs3.6 billion, mainly due to lower interest rates. The effective tax rate (ETR) for the quarter stood at 37 percent, compared to 35 percent in the preceding quarter and 27 percent in 2QFY25.
Alongside the results, the company announced a cash dividend of Rs2 per share for 2QFY26, bringing the total payout for 1HFY26 to Rs4 per share.
Copyright Business Recorder, 2026
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