Top SOEs see profits slide 15% to Rs622b as governance fails

[Samlee]

ISLAMABAD:
The combined profitability of Pakistan's top 15 state-owned companies decreased last year to a mere Rs622 billion, and there was only one firm with annual profits exceeding Rs100 billion, according to a new report by the Ministry of Finance.

The report, which has been approved by a cabinet committee, also pointed out serious flaws in the governance structures of all the public sector companies, including the ineffectiveness of their boards. It added that there was weak oversight by audit and risk committees of these boards. According to the State-Owned Entities (SOEs) report for the fiscal year 2024-25, the total profits earned by Pakistan's top 15 public sector companies amounted to just Rs622 billion. These were 5% or Rs30 billion lower than the preceding year.

The report has been approved by the Cabinet Committee on State-Owned Enterprises and is in the process of ratification by the federal cabinet. The Ministry of Finance has not yet officially released the report. It has also commented in detail on the effectiveness of SOE boards. The boards are mostly incomplete and template-driven; there is no assessment of board effectiveness and there is no measure of oversight quality, commented the Central Monitoring Unit of the Ministry of Finance, which prepared the report.

It added that there was weak accountability of boards, while decision-making was also found to be ineffective.

The remarks made by the finance ministry reflect poorly on governance during Prime Minister Shehbaz Sharif's government. These boards are mostly filled with loyalists or used to accommodate favoured individuals.

PM Sharif had decided that all bureaucrats who were members of different boards, in their official or private capacity, would not retain more than Rs1 million in board fees and had directed them to surrender the surplus amount to the government. However, the bureaucracy later compelled the prime minister to withdraw the decision.

The finance ministry stated in the report that boards have 50% independent representation, but there is weak independence of audit and risk committees and limited challenge to management.

There is also inconsistent reporting of key performance indicators, decisions and risk exposures; accountability was weak and stakeholders were unable to assess performance or fiscal exposure, it added. Less than 36% of SOEs have completed audits; delays persist and financial decisions were taken based on estimates, the Central Monitoring Unit apprised the cabinet committee. It added that lower valuation credibility had increased fiscal risks.

The report showed that there was only one company that earned more than Rs100 billion in profit, while only three companies posted profits exceeding Rs50 billion. A total of 14 SOEs recorded more than Rs10 billion in profits in the last fiscal year, according to the report.

With a 19% decline in profitability, Oil and Gas Development Company Limited (OGDCL) was the only firm that earned Rs170 billion in profit in the last fiscal year.

Pakistan Petroleum Limited earned Rs90 billion in profits, also down by 22%. The National Bank of Pakistan was the third highest public sector firm, registering Rs57 billion in profit, up by 106%, according to the report.

Profits in the oil and gas sector declined by one-fourth to Rs366 billion in the last fiscal year. The finance ministry said the decline was driven by receivables lock-up due to circular debt and price normalisation.

The balance sheets of oil and gas sector companies were also impacted by undue tax demands by the Federal Board of Revenue to meet its targets.

The fourth highest profit-making entity was the Water and Power Development Authority, which earned Rs52 billion in the last fiscal year. With Rs49 billion in profit, Government Holding Private Limited was the fifth highest profit earner, the report stated.

Karachi Port Trust earned Rs35.3 billion, Port Qasim Authority Rs35 billion and Pak-Kuwait Investment Limited registered Rs25 billion in profits during the last fiscal year. Pak-Arab Refinery Company earned Rs22 billion in profit, down by 60%.

Pakistan National Shipping Corporation earned Rs20.5 billion, State Life Insurance Company Rs14.8 billion and Sui Northern Pipelines Limited registered Rs14.5 billion in profit.

The finance ministry said accumulated losses of loss-making SOEs have reached Rs6.5 trillion and were increasing at an accretion rate of Rs700 billion to Rs900 billion every year.

Profitability has eroded as high-earning SOEs are under margin pressure due to rising costs and delayed tariff adjustments, according to the Finance Ministry. Aggregate profits of all government-owned companies declined from Rs821 billion to Rs710 billion — a reduction of 13% within a year.

The report stated that daily bleeding by these entities was equal to Rs3 billion, translating into over Rs1 trillion per annum, and added that these losses were creating massive fiscal pressure.

Zarai Taraqiati Bank Limited earned Rs9.6 billion in profit in the last fiscal year, slightly higher than the preceding year.

The report further stated that net financial deterioration indicated value destruction at the profit level, with losses outpacing profits despite a massive asset base. It added that companies' assets also shrank by 1% to Rs38 trillion within a year under the Pakistan Muslim League (Nawaz) government.

 

[Fatman17]

ISLAMABAD:
The combined profitability of Pakistan's top 15 state-owned companies decreased last year to a mere Rs622 billion, and there was only one firm with annual profits exceeding Rs100 billion, according to a new report by the Ministry of Finance.

The report, which has been approved by a cabinet committee, also pointed out serious flaws in the governance structures of all the public sector companies, including the ineffectiveness of their boards. It added that there was weak oversight by audit and risk committees of these boards. According to the State-Owned Entities (SOEs) report for the fiscal year 2024-25, the total profits earned by Pakistan's top 15 public sector companies amounted to just Rs622 billion. These were 5% or Rs30 billion lower than the preceding year.

The report has been approved by the Cabinet Committee on State-Owned Enterprises and is in the process of ratification by the federal cabinet. The Ministry of Finance has not yet officially released the report. It has also commented in detail on the effectiveness of SOE boards. The boards are mostly incomplete and template-driven; there is no assessment of board effectiveness and there is no measure of oversight quality, commented the Central Monitoring Unit of the Ministry of Finance, which prepared the report.

It added that there was weak accountability of boards, while decision-making was also found to be ineffective.

The remarks made by the finance ministry reflect poorly on governance during Prime Minister Shehbaz Sharif's government. These boards are mostly filled with loyalists or used to accommodate favoured individuals.

PM Sharif had decided that all bureaucrats who were members of different boards, in their official or private capacity, would not retain more than Rs1 million in board fees and had directed them to surrender the surplus amount to the government. However, the bureaucracy later compelled the prime minister to withdraw the decision.

The finance ministry stated in the report that boards have 50% independent representation, but there is weak independence of audit and risk committees and limited challenge to management.

There is also inconsistent reporting of key performance indicators, decisions and risk exposures; accountability was weak and stakeholders were unable to assess performance or fiscal exposure, it added. Less than 36% of SOEs have completed audits; delays persist and financial decisions were taken based on estimates, the Central Monitoring Unit apprised the cabinet committee. It added that lower valuation credibility had increased fiscal risks.

The report showed that there was only one company that earned more than Rs100 billion in profit, while only three companies posted profits exceeding Rs50 billion. A total of 14 SOEs recorded more than Rs10 billion in profits in the last fiscal year, according to the report.

With a 19% decline in profitability, Oil and Gas Development Company Limited (OGDCL) was the only firm that earned Rs170 billion in profit in the last fiscal year.

Pakistan Petroleum Limited earned Rs90 billion in profits, also down by 22%. The National Bank of Pakistan was the third highest public sector firm, registering Rs57 billion in profit, up by 106%, according to the report.

Profits in the oil and gas sector declined by one-fourth to Rs366 billion in the last fiscal year. The finance ministry said the decline was driven by receivables lock-up due to circular debt and price normalisation.

The balance sheets of oil and gas sector companies were also impacted by undue tax demands by the Federal Board of Revenue to meet its targets.

The fourth highest profit-making entity was the Water and Power Development Authority, which earned Rs52 billion in the last fiscal year. With Rs49 billion in profit, Government Holding Private Limited was the fifth highest profit earner, the report stated.

Karachi Port Trust earned Rs35.3 billion, Port Qasim Authority Rs35 billion and Pak-Kuwait Investment Limited registered Rs25 billion in profits during the last fiscal year. Pak-Arab Refinery Company earned Rs22 billion in profit, down by 60%.

Pakistan National Shipping Corporation earned Rs20.5 billion, State Life Insurance Company Rs14.8 billion and Sui Northern Pipelines Limited registered Rs14.5 billion in profit.

The finance ministry said accumulated losses of loss-making SOEs have reached Rs6.5 trillion and were increasing at an accretion rate of Rs700 billion to Rs900 billion every year.

Profitability has eroded as high-earning SOEs are under margin pressure due to rising costs and delayed tariff adjustments, according to the Finance Ministry. Aggregate profits of all government-owned companies declined from Rs821 billion to Rs710 billion — a reduction of 13% within a year.

The report stated that daily bleeding by these entities was equal to Rs3 billion, translating into over Rs1 trillion per annum, and added that these losses were creating massive fiscal pressure.

Zarai Taraqiati Bank Limited earned Rs9.6 billion in profit in the last fiscal year, slightly higher than the preceding year.

The report further stated that net financial deterioration indicated value destruction at the profit level, with losses outpacing profits despite a massive asset base. It added that companies' assets also shrank by 1% to Rs38 trillion within a year under the Pakistan Muslim League (Nawaz) government.

Perennial loss makers. SOEs are used to give employment to the government supporters. PPP is famous for it. As a example this is how PIA was ruined with over employment.

 

[Watandar]

Another awesome achievement of Munir-Shahbaz dynamic duo!

 

[RogerWilliams]

It’s hard to ignore how central governance failures are to the story. A 15% slide in profits among the top firms, combined with ballooning accumulated losses, suggests systemic issues rather than one-off shocks. The fact that boards are described as incomplete, ineffective, and largely unaccountable explains a lot about the weak oversight and poor decision-making. Even traditionally strong earners like OGDCL and PPL are under pressure, while delays in audits and reliance on estimates undermine credibility. When daily losses run into billions, this stops being a corporate problem and becomes a serious fiscal risk for the state.

 

[RogerWilliams]

ISLAMABAD:
La rentabilité cumulée des 15 principales entreprises publiques pakistanaises a chuté l'an dernier à seulement 622 milliards de roupies, et une seule entreprise a affiché des bénéfices annuels supérieurs à 100 milliards de roupies, selon un nouveau rapport du ministère des Finances.

Ce rapport, approuvé par un comité ministériel, met également en lumière de graves lacunes dans la gouvernance de toutes les entreprises publiques, notamment l'inefficacité de leurs conseils d'administration. Il souligne par ailleurs la faiblesse du contrôle exercé par les comités d'audit et de gestion des risques de ces conseils. D'après le rapport sur les entreprises publiques pour l'exercice 2024-2025, les bénéfices totaux des 15 principales entreprises publiques du Pakistan s'élèvent à seulement 622 milliards de roupies, soit une baisse de 5 % (30 milliards de roupies) par rapport à l'année précédente.

Le rapport a été approuvé par le Comité ministériel des entreprises publiques et est en cours de ratification par le Conseil des ministres. Le ministère des Finances ne l'a pas encore publié officiellement. Le rapport examine en détail l'efficacité des conseils d'administration des entreprises publiques. Ces conseils sont pour la plupart incomplets et standardisés ; leur efficacité n'est pas évaluée et la qualité du contrôle n'est pas mesurée, indique l'Unité centrale de suivi du ministère des Finances, qui a rédigé le rapport.

Le rapport ajoute que la responsabilité des conseils d'administration est faible et que le processus décisionnel est inefficace.

Ces observations du ministère des Finances jettent une lumière négative sur la gouvernance du gouvernement du Premier ministre Shehbaz Sharif. Ces conseils sont majoritairement composés de personnes loyales ou servent à favoriser certains individus.

Le Premier ministre Sharif avait décidé que les hauts fonctionnaires siégeant à différents conseils d'administration, à titre officiel ou privé, ne pourraient pas percevoir plus d'un million de roupies d'honoraires et leur avait ordonné de reverser le surplus à l'État. Cependant, la bureaucratie a par la suite contraint le Premier ministre à revenir sur sa décision.

Le ministère des Finances indique dans son rapport que les conseils d'administration comptent 50 % de représentants indépendants, mais que l'indépendance des comités d'audit et des risques est faible et que le pouvoir de contestation de la direction est limité.

Le rapport souligne également l'incohérence des rapports relatifs aux indicateurs clés de performance, aux décisions et à l'exposition aux risques ; la responsabilisation est insuffisante et les parties prenantes sont incapables d'évaluer la performance ou l'exposition financière. Grâce au casino en ligne, les paiement paysafecard https://gtamodding.fr/casino-en-ligne/paysafecard/ joueurs peuvent accéder à des centaines de jeux en quelques clics. Moins de 36 % des entreprises publiques ont fait l'objet d'audits ; des retards persistent et les décisions financières sont prises sur la base d'estimations, a indiqué l'Unité centrale de surveillance au comité ministériel. Elle a ajouté que la moindre crédibilité des évaluations a accru les risques financiers.

Le rapport révèle qu'une seule entreprise a réalisé un bénéfice supérieur à 100 milliards de roupies, tandis que seulement trois entreprises ont affiché des bénéfices dépassant 50 milliards de roupies. Au total, 14 entreprises publiques ont enregistré des bénéfices supérieurs à 10 milliards de roupies au cours du dernier exercice, selon le rapport.

Avec une baisse de rentabilité de 19 %, Oil and Gas Development Company Limited (OGDCL) est la seule entreprise à avoir réalisé un bénéfice de 170 milliards de roupies au cours du dernier exercice.

Pakistan Petroleum Limited a réalisé un bénéfice de 90 milliards de roupies, soit une baisse de 22 %. La Banque nationale du Pakistan se classe troisième parmi les entreprises publiques, avec un bénéfice de 57 milliards de roupies, en hausse de 106 %, selon le rapport.

Les bénéfices du secteur pétrolier et gazier ont diminué d'un quart pour s'établir à 366 milliards de roupies au cours du dernier exercice. Le ministère des Finances explique ce recul par le blocage des créances dû à la dette circulaire et à la normalisation des prix.

Les bilans des entreprises du secteur pétrolier et gazier ont également été affectés par des demandes d'impôts excessives de la part du Conseil fédéral des recettes, afin d'atteindre ses objectifs.

L'Autorité de développement de l'eau et de l'énergie (WDP) occupe la quatrième place du classement des entreprises les plus rentables, avec un bénéfice de 52 milliards de roupies au cours du dernier exercice. Avec un bénéfice de 49 milliards de roupies, Government Holding Private Limited se classe cinquième, précise le rapport.

Le Karachi Port Trust a réalisé un bénéfice de 35,3 milliards de roupies, l'Autorité portuaire de Qasim de 35 milliards de roupies et Pak-Kuwait Investment Limited de 25 milliards de roupies au cours du dernier exercice. La Pak-Arab Refinery Company a réalisé un bénéfice de 22 milliards de roupies, en baisse de 60 %.

La Pakistan National Shipping Corporation a dégagé un bénéfice de 20,5 milliards de roupies, la State Life Insurance Company de 14,8 milliards et la Sui Northern Pipelines Limited de 14,5 milliards.

Le ministère des Finances a indiqué que les pertes cumulées des entreprises publiques déficitaires atteignaient 6 500 milliards de roupies et augmentaient chaque année de 700 à 900 milliards de roupies.

Selon le ministère des Finances, la rentabilité s'est érodée, les entreprises publiques les plus rentables subissant une pression sur leurs marges en raison de la hausse des coûts et du retard des ajustements tarifaires. Le bénéfice global de toutes les entreprises publiques a diminué de 13 % en un an, passant de 821 milliards à 710 milliards de roupies.

Le rapport précise que les pertes quotidiennes de ces entités s'élèvent à 3 milliards de roupies, soit plus de 1 000 milliards par an, et ajoute que ces pertes engendrent une pression budgétaire considérable.

Des réformes sont débattues, des comités approuvent des rapports, et pourtant, les mêmes failles structurelles ressurgissent année après année. Les nominations politiques, le manque d'indépendance et l'absence de transparence créent un climat où l'inefficacité est tolérée, voire parfois récompensée. Tant que les conseils d'administration ne seront pas dotés de pouvoirs suffisants, que leurs performances ne seront pas auditées et qu'ils ne seront pas protégés des pressions politiques, tout redressement restera superficiel. Sans cette transformation, les entreprises publiques continueront de ponctionner les ressources publiques au lieu de soutenir la croissance, quelles que soient les conditions de marché.