Gas & Oil Pakistan Limited ('GO' or 'the Company') was incorporated as an unlisted public limited company in 2012 under the erstwhile Companies Ordinance, 1984 (now called the Companies Act, 2017). The Company acquired an OMC license in 2014 and commenced operations in Punjab in 2015, with subsequent expansions in Sindh, Khyber Pakhtunkhwa (KPK), Gilgit Baltistan (GB), and Balochistan. The Company began its operations by providing logistics services to other oil marketing companies. It steadily built a strong logistics network that has evolved into a vital service provider for major Oil Marketing Companies (OMCs). The Company is primarily engaged in marketing and selling petroleum products (POL). Currently, the Company operates the second largest retail network of ~1,329 stations, including ~75 company-operated company-owned (COCO) sites. To support the constantly growing retail network, the Company maintains numerous storage sites located throughout Pakistan. These sites hold a total storage footprint of ~87.5K MT for HSD and ~81.4K MT for PMG, including a dedicated storage facility at Fauji TransTerminal Limited, with a capacity of ~36.3K MT. This enables the Company to effectively and efficiently capture its widespread customers. The Company's profile has been uplifted by the induction of Aramco.

The Company is ~40% owned by Aramco, while the remaining (~60%) shares are held by Mr. Khalid Riaz, his family, and friends. As Aramco, headquartered in Saudi Arabia with an operational history of more than 90 years, holds a considerable equity stake in the Company, the ownership is expected to remain stable. The sponsors have extensive industry experience with a significant concentration in oil & lubricant trading and distribution & transportation to OMCs in the international and local market. The Company is set to reap benefit from the sponsors vast expertise and operational capabilities. The sponsors have a firm financial footing. Aramco is rated A+ by Fitch, with an adjusted net income of ~$ 76bln and free cash flows of $ 57.9bln in 9MCY25.

The Board of Directors (BoD) comprises ten members, out of which four Directors are the representatives of Aramco. There are two Independent Director on the BoD. Overall composition of the BoD ensures diverse experience and knowledge, along with the requisite independence in the decision-making process. The Chairman of the BoD, Mr. Tariq Kirmani, has 47 years of multifaceted experience in the domestic and international corporate sectors. Mr. Nader D. Al Douhan is the Director of DS International Retail at Aramco, and holds over 25 years of experience in downstream, upstream, and corporate services. Other representative Directors of Aramco, Mr. Abdul Aziz, Mr. Usman Hamid and Mr. Davide Crespi also carry diversified experience of more than two decades. The induction of the Directors representing Aramco has strengthen the BoDs strategic oversight and policy formation process. The BoD meets on a quarterly basis with complete attendance and comprehensive documentation of minutes. Two BoD Committees, namely the Board Audit Committe (BAC) and Board HR and Compensation Committee (BHRCC), monitors the operations effectively. These Committees meet on a quarterly basis with adequate attendance. Minutes of the Committee meetings are recorded and documented adequately. The External Auditors of the Company, M/s. PKF FRANTS has expressed an unqualified opinion on the financial statements for the period ended Dec-24. The firm is QCR-rated and listed on the SBP panel.

The Company's operations are divided into three primary functional areas: i) Operations, ii) Finance, and iii) Sales. Each department is managed by a department head who reports directly to the CEO. He then reports to the Board, that makes pertinent decisions. While, the Head of Internal Audit & HR functionally reports to the respective Board Committees, and administratively to the CEO. Mr. Khalid Riaz, the Company's CEO, has been associated with GO for more than a decade. He has an overall experience of over three decades. Lately, Mr. Zahid Zuberi has joined as the Company's CFO, with an overall professional experince of ~3 decades. Mr. Zahid's appointment has been done in consensus with Aramco. Overall, the average experience of the senior management is of around three decades, reflecting a good management profile. The management team comprises seasoned professionals, each bringing a range of expertise in their respective fields. GO has constituted two management committees, including i) Procurement and ii) Credit. These Committees meet on a quarterly basis, and the minutes of these meetings are recorded and documented adequately. Anticipating the need for enhanced management efficacy, as Aramco joins in, management-level committees may add-in. The senior management receives a daily performance report on operations for optimal monitoring. The Company’s operating environment has now been upgraded to SAP S/4HANA. This has effectively integrated with all the departments and ensures proper financial and operational control. The Company operates an in-house internal audit department to oversee risk management, control, and governance processes. Furthermore, the quarterly are also reviewed by the external auditor This ultimately enhances business practices by establishing standard operating procedures (SOPs).

The Company has captured ~13% market share based on the sale of POL products as of Aug-25. The Company generates revenue from MS (~49%), followed by HSD (~50%) and HOBC (~1%). During CY24, the Company reported an increase of ~36.1% in net revenue to ~PKR 327.8bln (CY23: 240.9bln), primarily due to volume-driven growth. Gross margins declined to ~5.4% (CY23: ~10.5%) due to increased procurement costs. Similarly, the operating margin dropped to ~3.6% (CY23: ~8.4%) due to the trickle-down effect. On the other hand, the Company's net margins rose to ~1.0% (CY23: ~0.7%) due to low finance costs (CY24: ~PKR 8.2bln, CY23: ~PKR 11.3bln), which was an impact of reduced borrowing. During 9MCY25, the Company reported revenue of ~PKR 450.6bln, reflecting continued volume-driven growth. Gross margin clocked in at ~3.6%, driven by competitive pricing dynamics and higher discounting strategies to build volumes. Resultantly, the net profit margin remained stable at ~0.7%, in line with the Company’s focus on sustaining market penetration. The Company booked a profit of ~PKR 3bln in 9MCY25. GO holds a customer-centric strategy with a contemporary vision well-aligned with Aramco, which is a well-positioned global giant in the energy sector, managing upstream operations, downstream operations, and energy transition. This strategic introduction has considerably improved the Company's supply chain and overall financial health. Going forward, the Company's revenues are expected to grow as depicted by an uptick in volumes. Similarly, profitability will also improve, while margins are expected to remain sustainable. Overall, the Company's performance is anticipated to improve.

The Company's financial risk is gauged through its working capital management, the Company's ability to build a suitable interest cover, and its capital structure. GO has worked on its working capital management as reflected by an improved net working cycle to ~20 days in CY24 (CY23: ~30 days). This improvement primarily stems from a notable increase in trade payable days from ~37 days in CY23 to ~51 days in CY24, highlighting improved credit terms for product import provided by Aramco. Stable receivable days (CY24: ~35 days, CY23: ~34 days) further strengthen the Company's working capital cycle. While inventory turnover days increased to ~36 days (CY23: ~33 days), it was primarily due to a significant increase in the Company's inventory levels (CY24: ~PKR 49bln, CY23: ~PKR 16bln) to support its enhanced operations. As of 9MCY25, inventory days stood at ~36 days, consistent with CY24. Trade receivable days improved to ~27 days, reflecting faster cash conversion, while trade payable days posted at ~48 days, remaining close to CY24 levels. Consequently, net working capital days stood at ~15 days, demonstrating strengthened operational efficiency. The Company has parked trade debts amounting to ~PKR 52.8bln as of 9MCY25 on its balance sheet. These mainly pertains to receivables from government entities, corporate customers and dealers. However, the growth in these receivables, which is about ~44% compared to CY24, is substantially slower than the annualized revenue growth, of about ~85%, reflecting GO’s disciplined focus on working capital management. Ths is strengthed by the implementation of a Board-approved credit policy and is expected to rationalize further as we move ahead. To further finance its working capital requirements, the Company now plans to issue a Short-Term, Rated, Unsecured, Privately Placed Sukuk of ~PKR 10bln, with a green shoe option of ~PKR 4bln. The Company has managed to expedite its interest coverage. As of CY24, the Company reported FCFO at ~PKR 13.2bln, reflecting a slight decline of ~3.65% (CY23: PKR ~13.7bln). This decline in FCFO was primarily driven by a reduced impact of finance cost reported at ~PKR 7bln (CY23: ~PKR 11bln). Nevertheless, the Interest Coverage Ratio improved to ~1.7x in CY24 (CY23: ~1.3x), attributed to declining finance costs. As of 9MCY25, the Company reported FCFO of ~PKR 9bln, remaining aligned with the cash flow profile relative to CY24 when adjusted for period length. Finance cost amounted to ~PKR 4.9bln, lower compared to the CY24 full-year figure, resulting in an improved interest coverage of ~2.3x. As we advance, improvements in coverage are anticipated and supported by lower interest rates, resulting in reduced finance costs. The Company reported a significant change in its leverage. As of CY24, the leverage ratio of the Company declined to ~49.5% (CY23: ~72.9%). The Company's total equity rose to ~PKR 32.4bln for CY24 compared to ~PKR 18.4bln for CY23, primarily due to the right issue, which raised the equity of the Company by ~10.6bln. Whereas, borrowings decreased to ~PKR 31.7bln in CY24 (CY23: ~PKR 49.6bln); majorly concentrated with STBs ~PKR 24bln in CY24 (CY23: ~PKR 40.4bln) for working capital management. As of 9MCY25, the Company reported shareholders’ equity at ~PKR 35.4bln, showing continued strengthening of the equity base. Total borrowings increased to ~PKR 56.5bln, owing to higher short-term financing utilized for expanded operations. This resulted in a leverage ratio of ~61.5%, higher than CY24 due to increased working capital borrowings. Capital adequacy of the Company is expected to remain strong, going forward. 

Gas and Oil Pakistan Limited ('GO' or 'the Company') is set to issue a Short-term, Rated, Unsecured, Privately Placed Sukuk with an issue size of up to PKR 10,000mln, inclusive of a green shoe option of PKR 4,000mln. The tenor is Up to 6 months from the date of drawdown. The instrument is unsecured and carries an expected profit rate of 6MK + 0.4%. The proceeds from the Sukuk will be utilized to finance the Company's working capital requirements. Profit will be paid at maturity, and the principal redemption will be in bullet at the expiry of the tenor.

The Sukuk is an unsecured instrument.

There are no additional credit enancement features attached with the instrument. Hence, the rating of the instrument is aligned with the rating of the issuer. The issuer has strong cashflow base, which is expected to provide substantial cover against the repayment of the principal and interest amount. As per the projections shared by the management, the proceeds of the instrument will improve the Company's working capital management. Majority of the Company's current assets constitute self liquidating inventory and receivables, which are expected to provide much needed liquidity at the time of maturity of the instrument. As represented by the management, there is significant cushion available in the short term borrowing lines as of today, which provides extra comfort.