Oil & Gas Exploration Companies: MARI GAS COMPANY LIMITED - Year Ended 30-06-2003
This gas exploration company's performance in both sales and production has reached new height. But exploration expenditure was much lower than preceding year's which would translate into simpler term as low exploration activity.
The outstanding balance of trade debts is reduced sharply to Rs 876.51 million from Rs 1978.38 million by 55.6%.
The amount due from the associated undertaking Fauji Fertiliser Company increased to Rs 252.8 million from Rs 201.92 million in the previous by 25%.
The company continued uninterrupted supply of gas throughout the year to all its customers namely, Fauji Fertiliser Company Ltd, Engro Chemical Pakistan Limited, Sui Southern Gas Company Ltd and Water and Power Development Authority (WAPDA).
The gas supply to fertiliser companies remained the same during the year whereas gas supply to WAPDA for power generation was enhanced to 110 MMSCF per day from 90 MMSCF per day with effect from November 2002.
The company's pre-tax profit crossed the billion rupee threshold from less than half a billion rupees last year.
Mari Gas Company Ltd is a public limited company incorporated in Pakistan having its registered office and head office at Islamabad.
The Mari Gas field was discovered in 1957, then, as the largest gas field of Pakistan with a proven reserve of 9.7 TCF covering an area of 968 sq KM.
The company was listed at Karachi Stock Exchange in 1994. Its shares are listed on all stock exchanges of the country.
The company is principally engaged in drilling, exploration, production and sale of natural gas.
According to the table of categories of shareholders as at June 30, 2003, Fauji Foundation has the largest stake in its equity, to the extent of 40%.
The government of Pakistan owns 20% of its stock. Another 20% of the stock is held by Oil & Gas Development Company Ltd NBP (Trustee Department: NIT) holds 8.22% of its stock. Its 2365 individual shareholders' aggregate shareholding works out to 8.23% of its total 36.75 million shares of Rs 10 each.
At present the share in the company is trading at the market value of Rs 79 per share which is nearly 8 times of its par value. During the last 52 weeks, the price of Mari Gas Company appreciated by 120.4% to Rs 97 from Rs 44 per share.
The address of its field office is Daharki District Ghotki in the province of Sindh.
For the financial year ended June 30, 2003 the actual production of gas increased to 156.291 BSCF from 149.573 BSCF natural gas produced in the preceding financial year.
The company's development and production of natural gas leases remain the same at 969.3 sq kilometre's since 1994.
The ultimate recovery of proven reserves at 6,309 BSCF remain the same since 1995-96. The cumulative production of natural gas upto the financial year 2002-03 has been recorded at 1359 BSCF.
This would mean that the cumulative production of gas has been attained at 21.5% of the "ultimate recovery of proven reserves." Since 1997-98, number of producing wells remained without increase/decrease at 64.
It has been stated in the Annual Report under review, that the company is proceeding ahead with the plans for bringing the already drilled six deep wells on stream.
The company has working interest share in the following exploration licences: (i) Ziarat Exploration License 100% as operator (ii) Jharmat Exploration Licenses 25% as J.V. Partner (iii) Manchar Exploration License 22.5% as J.V. Partner.
The company continues to acquire interest in different blocks.
During the year under review, the company posted net sales at Rs 2436.17 million as compared to net sales at Rs 1681.26 million posted in the preceding year showing sharp increase of 44.9%.
Royalty increased by 44.9% and operating expenses also went up by 23.1%. Exploration expenses were down by 43% evidencing the exploration activities were low.
The operating margin got tremendous boost from 23.47% in the preceding years to 34.06% during the year under review. Profit before taxation shot up by 161.1% to Rs 1052.35 million from Rs 402.98 million in the preceding year.
The company posted net profit after taxation at Rs 829.88 million and announced cash dividend at 30% in line with last year's pay out rate.
The directors informed that the company continues to pursue its evaluation of potential sedimentary basins of the country to identify new exploration areas as well as assessing prospects and negotiating terms for company's participation in the already awarded blocks through farm in arrangements with other companies.
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Performance Statistics (Million Rupees)
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30 June 2003 2002
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Share Capital-Paid-up: 367.50 367.50
General Reserves: 2.05 2.05
Undistributed Percentage
Return Reserve: 120.72 92.27
Profit & Loss Account: 1,458.48 951.16
Shareholders Equity: 1,948.75 1,412.98
L.T. Debts: 784.70 1,008.90
Deferred Income Tax: 228.88 -
Decommissioning Cost: 1,285.27 -
Other Deferred Liabilities: 27.87 78.95
Current Liabilities: 2,452.42 2,890.75
Fixed Capital Expenditure: 3,566.37 1,915.39
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L.T. Loans, Advances
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Deposits & Prepayments: 8.09 7.30
Current Assets: 3,153.43 3,468.89
Total Assets: 6,727.89 5,391.58
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Sales, Profit & Pay Out
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Sales-Net: 2,436.17 1,681.26
(Less)-Royalty: (304.18) (209.95)
Operating (Expenses): (806.32) (654.98)
Exploration (Expenditure): (175.69) (308.69)
Operating Profit: 1,149.98 507.67
Other Income: 81.74 94.45
Financial (Charges): (113.09) (177.92)
(Depreciation) & Amortisation: (337.79) (229.23)
Profit Before Taxation: 1,052.35 402.98
Profit After Taxation: 829.88 394.58
Dividend Cash @ 30%(2002: @ 30%): (110.25) (110.25)
Earnings Per Share (Rs): 17.58 10.75
Share Price (Rs) Dated 05.03.2004: 79.00 -
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Financial Ratios
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Price/Earning Ratio: 4.43 -
Book Value Per Share: 53.03 38.45
Price/Book Value Ratio: 1.49 -
Debt/Equity Ratio: 29:71 41:66
Current Ratio: 1.29 1.20
Asset Turn Over Ratio: 0.36 0.31
Days Receivables: 131 429
Operating Profit Margin (%): 47.20 30.20
Net Profit Margin (%): 34.06 23.47
R.O.A. (%): 12.33 7.31
R.O.C.E. (%): 19.41 15.77
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"Considering the nature of the company's business, information regarding capacity has no relevance. The actual production of gas for the year ended June 30, 2003 was 156.291 BSCF (2000: 149.573 BSCF)."
COMPANY INFORMATION: Chairman: Lieutenant General Syed Muhammad Amjad (Retd); Chief Executive: Lieutenant General Muhammad Afzal Janjua (Retd); Director: Qaiser Javed; Company Secretary: Khurram Khan; Registered Office/Head Office: 21-Mauve Area, 3rd Road, Sector G-10/4 Islamabad; Karachi Office: D-87, Block-4, Kehkashan Clifton (Sindh) Karachi 75600; Field Office: Daharki, District Ghotki (Sindh).
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