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ISLAMABAD: Shell Pakistan Limited (PSX: SHEL), now rebranded as Wafi Energy Pakistan Limited (WEPL), has reported a sharp decline in its annual profitability, with profit after tax dropping to Rs3.3 billion for the year ending December 31, 2024, compared to Rs5.8 billion in 2023. This represents a significant decrease of over 43%, reflecting the company’s challenging business environment over the past year.
It is important to note that the 2023 financial results included a one-time income of Rs10.7 billion related to the waiver of Shell Group liabilities. This income made a substantial impact on the previous year’s profitability, making the decline in 2024 appear even steeper.
Despite the drop in earnings, Wafi Energy Pakistan Limited announced a cash dividend of Rs5 per share (50%) for its shareholders. The company’s financial performance was affected by multiple factors, including fluctuations in global oil prices, economic uncertainties, and regulatory challenges within Pakistan’s energy sector.
The results come amid a major ownership transition, with Wafi Energy Holding Limited, an established Saudi company and affiliate of the Asyad Group, acquiring an 87.78% majority stake in the company. While the name has officially changed to Wafi Energy Pakistan Limited as of January 13, 2025, the Shell brand will remain in Pakistan through retail and brand licensing agreements, with Wafi Energy serving as the exclusive brand licensee.
The Board of Directors highlighted key business developments across various sectors. The Lubricants division expanded its market share with the Helix and Advance brands. In the mining sector, the company secured a premium win in the Saindak Gold and Copper mining project and established an exclusive partnership in the Thar Coal Project. Meanwhile, the Mobility business continued its expansion, adding 16 new sites and rebuilding nine existing ones. The convenience retail segment also saw strong growth, recording a 28% year-on-year increase.
Analysts suggest that while the acquisition may bring strategic shifts, the declining profit signals potential challenges ahead. Market observers will closely watch how Wafi Energy Pakistan navigates these hurdles and whether its new policies will help restore financial stability in the coming years.
