Transmission of Half Yearly Report for the Period Ended December 31, 2024

02 | FOR THE HALF YEAR ENDED DECEMBER 31, 2024

Report to Shareholders

For the six months ended December 31,2024

The Board of Management of Pakistan State Oil Company Limited (PSO) is pleased to present the condensed unconsolidated and consolidated interim financial statements for the six months ended December 31, 2024 (1HFY25) of the company and the group.

Exhibiting strength in the face of challenging market conditions, PSO posted a profit after tax of PKR 11.2 billion for 1HFY25 (1HFY24: PKR 7.7 billion) with earnings per share of PKR

1. Furthermore, the company attained gross sales of PKR 1.74 trillion (1HFY24: PKR

1. trillion). The Group posted a profit after tax of PKR 9.1 billion for the period (1HFY24:
   PKR 12.2 billion) translating into earnings per share of PKR 19.48 after incorporating
   Pakistan Refinery Limited (PRL) loss for the period.

The global economy is poised for a period of steady, yet subdued, growth. According to the International Monetary Fund (IMF), global real GDP growth will hold steady at 3.3% in both 2025 and 2026.

Economic recoveries in Brazil, the UK, and other countries are underpinning this stability. However, regional disparities remain a concern, with some economies thriving while others lag. A notable bright spot is China, where growth forecasts have been revised upward from 4.5% to 4.6% for 2025, driven by effective policy interventions and robust economic data. In comparison, the US economy is expected to experience a period of relative stability, with forecasted growth rates of 2.8% in 2024 and 2.7% in 2025.

Despite recent recoveries, global growth is expected to face headwinds in the second half of the year. The Eurozone and Central Eastern Europe remain vulnerable, with lingering weaknesses in manufacturing and trade. On a positive note, supply chain stabilization has helped tame inflation, with global headline inflation projected to decline to 4.2% in 2025 and 3.5% in 2026. This downward trend is driven by the resolution of supply-side issues and the impact of central banks' monetary tightening.

FOR THE HALF YEAR ENDED DECEMBER 31, 2024 | 03

The energy market witnessed significant developments, with average dated Brent crude oil prices dropping from $85.5 in H1FY24 to an average of $77.6 in H1FY25, a 9% decline from the same period last year. The Energy Information Administration (EIA) forecasts an average Brent crude price of $74 per barrel in 2025, indicating a stable outlook.

In contrast, the auto sector showed a positive sign with car sales surging 69% YoY to 9,820 units in December 2024, compared to 5,820 units in the same period last year. This remarkable growth was fueled by declining interest rates, and lower inflation.

The IMF reaffirmed its 3% growth projection for Pakistan in FY25, stressing the need for sustained structural reforms to maintain economic momentum amid ongoing challenges. Looking ahead, the IMF forecasts Pakistan's GDP growth to accelerate to 4% in 2026. Meanwhile, inflation is showing signs of easing, attributed to effective fiscal consolidation and monetary tightening. These efforts demonstrate Pakistan's advances in restoring macroeconomic stability.

The petroleum industry showcased remarkable resilience and adaptability in the first half of the fiscal year, deftly navigating a volatile market landscape. Particularly, Mogas sales surged 6% YoY, while diesel sales posted an impressive 8.9% YoY growth. In contrast, black oil sales plummeted 36% YoY, primarily driven by the power sector's sustained shift away from furnace oil. These divergent trends highlight the sector's agility in responding to shifting market dynamics and evolving consumption patterns.

During 1HFY25, PSO maintained its market leadership, demonstrating strength and agility despite unfavorable market conditions. The company maintained a strong presence in the white oil segment, achieving total sales of 3,610 KMT with a market share of 47.1%. In the diesel segment, PSO secured a 48.1% market share, with sales reaching 1,660 KMT. Its MoGas portfolio captured a 41.5% market share, recording total sales of 1,601 KMT. The company also strengthened its leadership in the jet fuel segment, securing a 99.1% market share with total sales of 326.8 KMT.

FY25 marked a significant milestone for PSO as the company achieved its highest-ever LPG sales. Monthly sales surged to a record growth of 22.3%, reaching 5.2 KMT in December 2024, compared to 4.25 KMT in December 2023. Sales reached an unprecedented 27.56 KMT during 1HFY25, reflecting a growth of 10.02%, compared to 25.04 KMT in 1HFY24.

To support sustainable growth and enhance operational efficiency, the company continued to prioritize infrastructure upgrades, including the rehabilitation of 3 lubricant tanks, adding 3 KMT of capacity at Keamari Terminal B (KTB) and Lubricant Manufacturing Plant A (LMPA) facilities. A further expansion is underway, with 4 additional tanks being rehabilitated to increase storage capacity by 7 KMT. At its Faqirabad depot, the company expanded its storage capacity by 25 KMT for PMG and HSD fuels, following the construction of 2 new storage tanks.

As part of its customer-centric strategy, PSO propelled a significant expansion of its retail network, marked by the milestone achievement of 3,610 outlets nationwide equipped with 111 remodeled convenience stores. This strategic upgrade elevated the customer experience, introducing an extensive range of services and amenities tailored to meet the evolving needs of the company's customers, ultimately fueling growth in its retail business.

04 | FOR THE HALF YEAR ENDED DECEMBER 31, 2024

PSO continued its digital transformation journey to boost operational efficiency through focused initiatives and infrastructure enhancements. A notable accomplishment in this regard was the successful deployment of Dispensing Unit Controllers (DUCs) at 50 additional retail locations, expanding coverage to 1,200 sites and enabling seamless data management and real-time network monitoring.

The company raised the bar in retail excellence with the launch of VIBE, its pioneering concept convenience store in Karachi, redefining the retail experience and setting new standards for customer satisfaction.

In a strategic move to streamline logistics and fuel supply operations for the national railway network, PSO partnered with Pakistan Railways to launch refueling services at 8 key locations, including Pipri and Faisalabad.

Making a significant impact on the lives of countless Pakistanis, PSO contributed PKR 130 million to various charitable organizations, addressing pressing needs across healthcare, education, youth development, community empowerment, and environmental sustainability.

PSO remained committed to ensuring a reliable fuel supply across Pakistan, maintaining optimal stock levels to support economic growth. To drive business excellence, the company focused on strategic initiatives such as digitization, automation, and process optimization, while also pursuing targeted capacity expansions to enhance its financial and operational performance.

In tandem, PSO is prioritizing customer-centric innovations, introducing value-added services to boost customer satisfaction, while also advancing strategic, long-term projects designed to generate substantial shareholder value and sustainable growth.

The circular debt crisis remains a major challenge to PSO's financial performance. As of December 31, 2024, the company's receivables stood at PKR 467 billion, with a substantial PKR 340 billion owed by SNGPL. To mitigate this financial strain, the company is actively collaborating with the government to explore viable solutions and resolve the longstanding circular debt issue.

We would like to extend our sincere gratitude to our employees, stakeholders, and business partners for their ongoing support. We would also like to thank the Government of Pakistan, particularly the Ministry of Energy (Petroleum Division), for their guidance and collaboration in navigating these challenges.

FOR THE HALF YEAR ENDED DECEMBER 31, 2024 | 05

Independent Auditor's Review Report

To the Members of Pakistan State Oil Company Limited

Report on Review of Condensed Unconsolidated Interim Financial Statements

Introduction

We have reviewed the accompanying condensed unconsolidated interim statement of financial position of Pakistan State Oil Company Limited ("the Company") as at December 31, 2024 and the related condensed unconsolidated interim statement of profit or loss, condensed unconsolidated interim statement of comprehensive income, condensed unconsolidated interim statement of changes in equity, and condensed unconsolidated interim statement of cash flows, and notes to the condensed unconsolidated interim financial statements for the six-months period then ended (here-in-after referred to as the "Condensed Unconsolidated Interim Financial Statements"). Management is responsible for the preparation and presentation of these condensed unconsolidated interim financial statements in accordance with accounting and reporting standards as applicable in Pakistan for interim financial reporting. Our responsibility is to express a conclusion on these condensed unconsolidated interim financial statements based on our review.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of condensed unconsolidated interim financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed unconsolidated interim financial statements are not prepared, in all material respects, in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting.

Emphasis of Matter

We draw attention to note 11.3 to the accompanying condensed unconsolidated interim financial statements which describe in detail matter relating to overdue receivables on account of Inter- Corporate circular debt. Our conclusion is not modified in respect of this matter.

06 | FOR THE HALF YEAR ENDED DECEMBER 31, 2024

Other Matter

The figures of the three-month period ended December 31, 2024 and December 31, 2023 in the condensed unconsolidated interim statement of profit or loss and condensed unconsolidated interim statement of comprehensive income have not been reviewed and we do not express a conclusion on them.

The engagement partner on the audit resulting in this independent auditor's review report is Inam Ullah Kakra.

KPMG Taseer Hadi & Co.

Chartered Accountants

Islamabad

Date: February 24, 2025

UDIN: RR202410202iDb0ZFIdC

FOR THE HALF YEAR ENDED DECEMBER 31, 2024 | 07

Condensed Unconsolidated Interim Statement of Financial Position

As at December 31, 2024

------------- (Rupees in '000) -------------

The annexed notes 1 to 27 form an integral part of these condensed unconsolidated interim financial statements.

Ahmed Jamal Mir

-

08 | FOR THE HALF YEAR ENDED DECEMBER 31, 2024