Mari shareholders have an exceptional year With high sales and the lifting of its dividend distribution cap, things are looking up for Mari
M
ari Petroleum has managed to outdo itself. According to its latest annual report, the 2021 fiscal year has been exceptional to say the least. The company recorded its highest sales at about Rs73 billion. While that is only a leisurely increase of 1.4% from the previous year, it is still impressive considering the dicey economic environment created due to the global pandemic. In fiscal year 2021 the company also clocked its highest net profit margin, standing at 43.1% of sales, or an increase of 3.7% from the previous year to Rs31.4 billion. Furthermore, its gross profit rose by 19% from Rs50.6 billion in 2020, to Rs60.2 billion in 2021 - its highest recorded gross profit yet. And that isn’t even the best news. In a recent decision, the Economic Coordination Committee of the Cabinet approved the lifting of Mari’s dividend distribution cap in February 2021, allowing the company to determine dividend payout in accordance with applicable laws and internal funding constraints. This was a welcome change for all shareholders who had been urging for higher payouts considering Mari’s success, and the new management of the company did not disappoint, doling out a hefty Rs141 dividend per share. It is a sharp contrast from the years between 2015 and 2020, when the average dividend per share had been Rs 5.68.
POWER
It is another feather in the cap of an already successful history. To recall: Mari Petroleum’s genesis was as the Mari Gas Field, which was originally owned by Pakistan Stanvac Petroleum Project, a joint venture formed in 1954 between the Government of Pakistan (with a 49% share) and Esso Eastern Incorporated (a 51% share). The Pakistan Stanvac Petroleum Project first discovered gas in 1957, while production from the field started in 1967. The company changed form, when in 1983, Esso Eastern sold its entire share to the Fauji Foundation. The company was converted into a publicly listed company in 1984, where
Fauji Foundation had 40% shares, the Government of Pakistan had a 40% share, and the Oil and Gas Development Company owned 20% (today, the Government of Pakistan has an 18.4% share, while the other two shareholding remains the same). Initially, the company only operated as a gas production company. But in 2001, the company was granted a license for exploration of oil and gas in addition to production activities. The name of the company was also changed from “Mari Gas Company Limited” to “Mari Petroleum Company Limited in 2012, to reflect its diversified business operations and expanded activities. It became a fully integrated exploration and production (E&P) company in 2013, when it set up its own 3D seismic data acquisition unit and processing centre, instead of outsourcing their work to other E&P companies. The government was keeping note, and extended the Mari lease twice, in 2014 and again in 2019. These incremental steps, and then revamping in the last decade, have paid off. Essentially, the company is now in control of the country’s largest gas reservoir (in terms of remaining reserves), the Mari Gas Field near Daharki, Sindh. It is Pakistan’s second-largest gas producer, with a 21% market share, and the second-largest reserves base.
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