Pakistan State Oil Company (PSO) has released its July-September (1QFY15) results on Tuesday posting profit after tax of Rs5.2 billion (EPS: Rs19.30) as compared to net profit of Rs7.8 billion (EPS: Rs28.70) for 1QFY14, a decrease of 33%YoY. The Company’s 1QFY15 result came as a surprise. Despite declining sales, the company improved its gross margins to 4.0% in 1QFY15 as compared to 3.87% for the same period last year. Key highlights of the result included: 1) revenue and cost of sales both going down by 5%YoY , 2) marginal decline of 2%YoY in gross profits which highlights lower than initially estimated inventory losses, 3) a massive decline 67%YoY in ‘other income’ owing to very little to no penal income received from the IPPs, 4) operating expenses going down by 40%YoY highlighting lower than expected exchange loss incurred by the company during 1QFY15 and 5) reduced financial charges by 15%YoY to Rs2.7 billion in 1QFY15 as compared to Rs3.2 billion during the same period last year.