KARACHI: Pakistan State Oil (PSO) reduced its trade receivables by Rs22.7 billion to Rs414.8 billion in FY26, mainly due to a decline in outstanding amounts owed by government entities, helping the state-owned oil company lower its finance costs by 24 per cent despite continued liquidity pressures.
According to PSO’s FY26 annual report, trade receivables stood at Rs414.8 billion at the end of the financial year, compared with Rs437.5 billion in FY25.
Net receivables from SNGPL, GENCOs and PIA Holding Company stood at Rs357.5 billion. SNGPL remained the largest contributor, with outstanding dues falling to Rs276.1 billion from Rs310 billion a year earlier.
GENCOs owed Rs67.6 billion, while the outstanding amount from PIA Holding Company stood at Rs13.8 billion.
The decline in receivables, coupled with lower discount rates, helped PSO reduce its finance costs by 24 per cent during the year. However, higher operating expenses and taxation limited the impact on overall profitability.
Petroleum Products Segment Drives Gross Profit
PSO’s gross profit increased to Rs99.9 billion in FY26, compared with Rs96.7 billion in the previous year.
Excluding the LNG business, gross profit rose 20.5 per cent to Rs81.9 billion, from Rs67.9 billion in FY25.
The petroleum products segment remained the company’s largest contributor. Net sales increased 11.7 per cent year-on-year to Rs2.41 trillion, while gross profit rose 19.7 per cent to Rs80.8 billion.
Despite the improvement in segment performance, PSO’s overall profit after tax declined 13.1 per cent to Rs20.7 billion.
Other Receivables Rise
PSO’s other receivables increased 20.8 per cent to Rs173.9 billion, primarily due to the recognition of Rs24.2 billion in price-differential claims receivable from the government following the introduction of the Price Differential Claim (PDC) mechanism for petrol and high-speed diesel (HSD).
The company said Rs24.2 billion had already been reimbursed, while efforts were continuing to recover the remaining outstanding amount from the Oil and Gas Regulatory Authority (OGRA) and the government.
Meanwhile, sales tax refundable increased 12 per cent to Rs83.1 billion.
LNG Business Remains Under Pressure
PSO’s LNG segment continued to face challenges, with net sales falling 35.8 per cent to Rs630.6 billion and gross profit declining 37.2 per cent to Rs18.1 billion.
The company attributed the decline primarily to supply disruptions around the Strait of Hormuz, which affected cargo availability and reduced RLNG volumes.
The LNG segment recorded a loss of Rs7.9 billion during FY26.
Storage Capacity Expanded
PSO also continued to strengthen its storage infrastructure, taking total storage capacity to 1.23 million tonnes after rehabilitating around 39,000 tonnes during the year.
The company’s retail network expanded by 92 outlets to 3,688 locations.
For FY27, PSO has identified the White Oil Pipeline, site solarisation and electric-vehicle (EV) charging infrastructure among its key strategic priorities.
Despite efforts to improve liquidity, the company’s short-term borrowings increased 7.9 per cent to Rs384.3 billion in FY26, compared with Rs356.1 billion a year earlier, driven mainly by a significant increase in local-currency borrowings.
