OGDC Faces 9.3% Profit Decline in FY 2020-21, Rubbishes Rumors of CEO Resignation

The Oil and Gas Development Company (OGDC) reported a 9.3% decline in its profit, earning Rs. 91.5 billion in the Fiscal Year 2020-21 as compared to Rs. 100.9 billion in the FY 2019-20. Announcing its financial results of FY 2020-21, the company explained that the contraction in profits was due to a decline in finance and other incomes. OGDC, however, claimed to be the largest profit-making organization in the country. It further announced a final cash dividend of Rs. 1.5 per share, taking the total dividend during FY 2021 to Rs. 6.9 per share. The firm revealed that the net sales of the company went up from Rs. 232.9 billion in 2019-20 to Rs. 239.1 billion in the FY 2020-21, marking an increase of 2.65%. The finance cost of the company dived to Rs. 2.2 billion in FY 2020-21 compared to Rs. 3 billion in FY 2019-20. During FY 2020-21, finance and other incomes took a hit as they plunged 60% to Rs. 14 billion. The company had received Rs. 33.8 billion under this head in FY 2019-20. Meanwhile, against the backdrop of rumors and media reports about the purported resignation of Shahid Salim Khan, Managing Director/CEO Oil & Gas Development Company Limited (OGDCL), the company made it clear and confirmed that Shahid Salim Khan was performing duties and providing leadership to the company. According to a press release issued by OGDCL, the latest discovery of Wali Well in district Lakki Marwat was one of the major discoveries with significant reserves not seen in the past decade. The statement underlined that Shahid Salim Khan had been focussing on the company’s governance and internal controls since he assumed office. “A comprehensive exercise was initiated for policy reform and organizational restructuring to manage the business and operations in line with international best practices. The reforms are now in the implementation phase and will bring enhanced efficiency and effectiveness,” said the company statement. OGDCL stated that Shahid Salim Khan had conveyed his intention to resign as MD/CEO due to personal and health reasons, but the Board had yet to consider and conclude the matter. According to the press release, issued to reject the rumors and ‘unsubstantiated media reporting’ on this issue: “The OGDCL Board has always reposed full confidence in the abilities and competencies of Shahid Salim Khan. The incumbent will meanwhile continue to perform his functions.”