Mari Energies quarterly profit falls 18% on weaker oil prices

Mari Energies Ltd. net profit fell by 18% in the quarter ended Dec. 31 from a year earlier quarter as weaker oil prices and higher operating costs offset gains from improved gas pricing.

The company said that net profit after tax for the quarter ended Dec. 31 stood at PKR 12.8 billion, or PKR 10.66 per share.

Profit declined 18% from the preceding quarter, when Mari Energies earned PKR 15.6 billion.

Net sales rose 8% year on year to PKR 44.8 billion, remaining broadly flat from the previous quarter. The increase came despite a 13% year-on-year drop in oil prices to an average of $65.4 per barrel, as higher realized prices from fields governed by the PP12 pricing policy supported revenue.

Estimated production during the quarter was about 800 million cubic feet per day of gas and 1,500 barrels per day of oil.
Operating and administrative expenses fell 20% from a year earlier but jumped 44% quarter on quarter to PKR 12 billion.

The company attributed the sequential increase largely to higher security-related costs for operations in sensitive regions.

Exploration expenses declined 50% from a year earlier and 16% from the previous quarter to PKR 1.9 billion, reflecting reduced seismic activity. Finance income dropped 57% year on year and 40% quarter on quarter to PKR 1.0 billion, mainly due to lower interest rates, with average KIBOR falling to about 11.1%.

Mari Energies reported an effective tax rate of about 35% for the quarter, up from 32% in the previous quarter, contributing to the decline in profitability.

For the first half of fiscal 2026, the company earned PKR 28.4 billion, or PKR 23.69 per share, down 6% from a year earlier.

The board declared a cash dividend of PKR 8.30 per share for the quarter and approved an additional investment of PKR 2.5 billion in its subsidiary, Mari Minerals (Pvt.) Ltd.

Looking ahead, the company said earnings could improve as gas offtake has begun to recover. Recent weekly data show record production of about 1 billion cubic feet per day, driven mainly by higher volumes from Mari Development & Production fields. Output from other fields may also rise following the diversion of imported liquefied natural gas cargoes.

In addition, the government has approved the allocation of about 200 million cubic feet per day of Mari Energies’ gas to fertilizer plants, a move expected to support volumes over the medium term.

Despite these positives, analysts said much of the upside is already reflected in the stock price and maintained a neutral view on the company, with a target price of PKR 662 per share.