KARACHI: Listed companies posted their highest-ever quarterly profits in January-March as their earnings grew 33.7 per cent year-on-year to Rs320 billion.

Data compiled by Arif Habib Ltd showed earnings growth was driven by the banking sector. Their bottom lines expanded as a result of the interest rate hike.

The fertiliser sector also helped improve the overall profitability of the listed firms, thanks to higher urea prices coupled with a 17 per cent year-on-year increase in the urea off-take.

The oil and gas exploration sector also posted a noteworthy jump on the back of a significant rise in international oil prices amid the Russian-Ukraine conflict. However, the cement sector posted muted growth whereby the impact of higher retention prices was partially offset by the surge in coal prices.

Bottom lines of firms in the oil and gas marketing sector were aided by hefty inventory gains booked during the quarter.

Textile companies benefitted from the rupee depreciation while the refinery sector remained a beneficiary of inventory gains during the quarter under review.

In January-March, major contributors to the rise in earnings growth include oil and gas marketing companies, whose earnings rose 222pc year-on-year to Rs39.3bn, followed by glass and ceramics (119pc to Rs1.9bn), miscellaneous (97pc to Rs0.8bn), refinery (87pc to Rs5.1bn), textile composite (79pc to Rs9bn), oil and gas exploration (77pc to Rs81bn), textile spinning (46pc to Rs1.5bn), automobile parts (34pc to Rs1.3bn) and commercial banking (28pc to Rs79.2bn).

On a quarter-on-quarter basis, earnings of the listed companies increased 28pc, led by banks (19pc), fertiliser (25pc), oil and gas exploration (28pc), cement (4pc) and power generation (18pc).

Profitability of publicly traded firms in the first nine months of 2021-22 increased 23pc year-on-year to Rs822bn, the research report showed.

The brokerage based its analysis on the companies that constitute the KSE-100 index. It used the earnings data of 86 companies as the remaining (14) companies had yet to release their financial results. These companies represent almost 95pc of market capitalisation.

Published in Dawn, April 30th, 2022