Oil and Gas Development Company Limited (OGDC) has reported strong financial results for fiscal year 2026 (FY26), with earnings per share (EPS) increasing 42.8 percent year-on-year (YoY) to Rs. 56.35.
The company also announced its highest-ever annual dividend of Rs. 17 per share for FY26, compared with Rs. 15.1 per share in FY25, marking a 12.6 percent increase.
OGDC’s EPS rose from Rs. 39.5 in FY25, supported by 25 percent and 17 percent YoY growth in oil and gas production, respectively. Earnings were also supported by a one-off reversal of the super tax provision, according to Arif Habib Limited.
During the fourth quarter of FY26 (4QFY26), OGDC posted earnings of Rs. 29.55 per share, nearly three times the Rs. 10 per share recorded in the same quarter of the previous year.
The company reported quarterly net sales of Rs. 149.1 billion, representing a 65 percent YoY increase and a 39 percent rise compared with the previous quarter. According to Topline Securities, the growth was driven by the start of production from the Baragzai field and higher crude oil prices.
For the full fiscal year, OGDC’s revenue increased 12 percent YoY to Rs. 449.2 billion.
The company’s royalty expenses rose significantly during the fourth quarter, increasing 699 percent YoY to Rs. 17.2 billion. Royalties accounted for around 12 percent of net sales.
Exploration costs also increased 2.6 times YoY and 1.8 times quarter-on-quarter to Rs. 10.9 billion in 4QFY26, mainly due to drilling at two dry wells, Chak-203 and Saidpur.
Operating expenditures increased 45 percent YoY to Rs. 50.9 billion during the quarter. OPEX per barrel of oil equivalent stood at $11.6, compared with $10.0 in 4QFY25 and $7.6 in 3QFY26.
OGDC also recorded a Rs. 44 billion tax reversal during the quarter following the Federal Constitutional Court’s decision on the super tax. As a result, the company’s effective tax rate for FY26 declined to 6 percent from 39 percent in FY25.
The company’s receivables recovery ratio improved to 103 percent in 4QFY26 from 86 percent in 3QFY26, reflecting stronger recoveries from Sui companies. The ratio has remained above 100 percent for two consecutive years.
OGDC declared a final cash dividend of Rs. 6 per share for 4QFY26, taking its total FY26 dividend payout to a record Rs. 17 per share. The total payout represents a 30 percent payout ratio, compared with 38 percent in FY25.
The company is currently trading at estimated price-to-earnings ratios of 6.1 times for FY27 and 5.2 times for FY28.
