Karachi, February 20, 2025 – Shell Pakistan, now rebranded as Wafi Energy Pakistan Limited, has reported a 44% drop in annual profit for the financial year ending December 31, 2024.
The decline is primarily attributed to higher tax payments and reduced gross margins.
As per the statement of profit or loss submitted to the Pakistan Stock Exchange (PSX) on Thursday, Shell Pakistan recorded a profit after tax of Rs 3.30 billion, significantly lower than the Rs 5.85 billion reported in the previous year. Consequently, earnings per share (EPS) fell to Rs 15.41, compared to Rs 27.34 in 2023.
The board of directors of Shell Pakistan convened on February 20, 2025, to approve the financial statements and discuss dividend payouts. Following the review, the board announced a cash dividend of Rs 5 per share for the year ending December 31, 2024.
Despite the sharp decline in profit, Shell Pakistan’s net revenue showed only a slight dip, decreasing to Rs 428 billion in 2024, compared to Rs 431 billion in the preceding year. However, the company’s gross profit declined notably, reaching Rs 23.54 billion, down from Rs 30.77 billion in the previous year.
On the expenditure side, Shell Pakistan managed to reduce its administrative expenses significantly, bringing them down to Rs 6.7 billion for 2024, compared to Rs 10 billion in the previous year. This cost-cutting effort aimed to offset some of the pressure from declining profits and rising tax obligations.
One of the major reasons for the profit downturn was the sharp increase in tax payments. Shell Pakistan paid Rs 3.85 billion in income tax during 2024, a substantial rise compared to Rs 1.40 billion in the previous year. The higher tax burden directly impacted the company’s bottom line, further squeezing profitability despite stable revenues.
Shell Pakistan has faced several challenges over the past year, including volatile global oil prices, currency fluctuations, and stringent taxation policies. The company has reiterated its commitment to efficiency improvements and strategic cost management to sustain profitability in the coming years.
As Shell Pakistan moves forward under its new branding as Wafi Energy Pakistan Limited, stakeholders will closely monitor how the company adapts to evolving economic and regulatory conditions to maintain growth and profitability in Pakistan’s competitive energy market.