⚡ Flash Summary

Sui Northern Gas Pipelines Limited (SNGPL) announced its financial results for the third quarter ended March 31, 2025. The company reported a decrease in profit for the period, with earnings per share also declining compared to the same period last year. While revenue inclusive of tariff adjustment saw a decrease, the cost of gas sales also decreased, resulting in a lower gross profit. The company did not recommend any cash dividend, bonus shares, or right shares.

📌 Key Takeaways

• 📉 Revenue inclusive of tariff adjustment decreased to PKR 366.83 billion from PKR 398.60 billion year-over-year.
• ⛽ Cost of gas sales decreased to PKR 324.83 billion from PKR 387.86 billion year-over-year.
• 😟 Gross profit significantly decreased to PKR 42.00 billion from PKR 10.73 billion year-over-year.
• 💰 Other income decreased to PKR 3.47 billion from PKR 10.88 billion year-over-year.
• 💼 Operating profit decreased to PKR 10.72 billion from PKR 15.47 billion year-over-year.
• 💸 Finance costs decreased to PKR 6.40 billion from PKR 9.41 billion year-over-year.
• 😔 Profit before income tax decreased to PKR 4.32 billion from PKR 4.79 billion year-over-year.
• 🧾 Income tax increased to PKR 1.93 billion from PKR 1.09 billion year-over-year.
• 📉 Profit for the period decreased to PKR 2.39 billion from PKR 3.70 billion year-over-year.
• 📉 Earnings per share (basic and diluted) decreased to PKR 3.77 from PKR 5.83 year-over-year.
• ❌ No cash dividend was recommended by the Board of Directors.
• 🏢 Total equity increased to PKR 71.48 billion as of March 31, 2025, compared to PKR 64.19 billion as of June 30, 2024.
• ⚠️ Long term financing from financial institutions (secured) decreased to PKR 16.21 billion from PKR 22.99 billion.
• 💵 Cash and bank balances decreased to PKR (135.61) billion from PKR (109.48) billion.

🎯 Investment Thesis

Based on the Q3 2025 results, a HOLD recommendation is appropriate. The decreased profitability and EPS are concerning, but the company’s efforts to manage costs and maintain equity are positive signs. Further monitoring of the company’s operational efficiency, revenue generation, and response to market challenges is required. A price target cannot be recommended until there is more information and further analysis is completed. Time horizon is 6-12 months.

⚡ Flash Summary

Sui Northern Gas Pipelines Limited (SNGPL) reported its financial results for the year ended June 30, 2025. The company announced a final cash dividend of Rs. 3.00 per share, representing a 30% payout, in addition to an already paid interim dividend of Rs. 0. Revenue decreased to PKR 1,408.55 billion from PKR 1,532.91 billion, while profit after tax decreased to PKR 14.59 billion from PKR 18.98 billion. The company’s financial statements are qualified due to non-compliance with IFRS 14 presentation requirements regarding regulatory deferral accounts.

📌 Key Takeaways

• 💰 Final cash dividend of Rs. 3.00 per share (30%) declared for FY25.
• 📉 Revenue decreased by 8.1% YoY from PKR 1,532.91 billion to PKR 1,408.55 billion.
• 📉 Gross profit increased significantly from PKR 44.41 billion to PKR 80.48 billion, due to decrease in cost of gas sales.
• 📉 Profit after tax decreased by 23.1% YoY from PKR 18.98 billion to PKR 14.59 billion.
• 📉 Earnings per share (EPS) decreased from Rs. 29.92 to Rs. 23.01.
• ⚠️ Auditor’s qualified opinion due to non-compliance with IFRS 14 presentation requirements.
• ❗ Regulatory Deferral Account (RDA) balances are recognized, but presentation doesn’t comply with IFRS 14.
• ❗ Settlement of circular debt is dependent on government resolution of intercorporate balances and gas price increases/subsidies.
• 📅 Annual General Meeting (AGM) scheduled for November 27, 2025.
• ⛔ No bonus or right shares were announced.

🎯 Investment Thesis

Given the decline in profitability, regulatory compliance issues, and dependence on government policies, a HOLD recommendation is appropriate. The company faces significant challenges related to circular debt and regulatory requirements, which could limit its growth potential in the near term. The price target is contingent on the resolution of these challenges and improvements in financial performance.