February 23, 2026 (MLN): Oil & Gas Development Company Limited (PSX: OGDC) reported a net profit of Rs73.02 billion for the half year ended December 31, 2025, down 11.5% from Rs82.46bn in the same period last year.

Earnings per share declined to Rs16.98 from Rs19.17 in H1 FY2025.

The company’s net sales decreased 6.6% YoY to Rs192.83bn from Rs206.42bn, showing lower overall revenue generation.

Cost of sales, including royalty and operating expenses, resulted in a gross profit of Rs103.46bn, down 18.8% YoY from Rs127.41bn in the prior period.

Gross profit margins contracted to 53.6% from 61.7%, indicating margin pressure amid declining revenues and sustained costs.

Operating expenses rose 24% YoY to Rs65.74bn, while transportation charges slightly declined 6% to Rs1.08bn. Exploration and prospecting expenditure surged 51% to Rs11.90bn, contributing to higher cost absorption. General and administrative expenses increased 19.6% YoY to Rs4.54bn.

Other income, comprising finance and miscellaneous gains, fell sharply 42% to Rs26.94bn from Rs46.58bn last year, dampening overall profitability.

Finance costs eased 17.6% to Rs2.42bn, providing modest relief. Workers’ profit participation fund expense declined 28.9% to Rs5.84 billion.

The company’s share of profit in associates rose 11.1% to Rs5.17bn, partially offsetting the decline in core operations.

Profit before income tax dropped 28.9% to Rs110.86bn from Rs155.82bn, while taxation declined 48.4% to Rs37.84bn.

The lower tax charge helped cushion the impact of weaker operational performance, resulting in a net profit decline of 11.5%.

OGDC declared an interim cash dividend of Rs4.25 per share (42.5%) for Q2 FY2026, in addition to the previously paid interim dividend of Rs3.50 per share (35%).

Despite the YoY decline in profits, OGDC’s operational resilience and continued dividend payouts highlight strong cash generation and shareholder value.

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