Code of ethics:

 PTCL has shown its commitment to maintaining the highest level of integrity in their business
by following carefully laid down ethical principles in order to develop and maintain good
relationship with their customers, employees, management and suppliers.
 All customers and employees must be treated with respect and dignity regardless of their
race, caste, religion, gender, age and political opinions. Employee and customer harassment
must be prevented at all levels.
 Employees must also adhere to values based on merits, performance and transparency while
carrying out their tasks and taking decisions.
 Employees are also advised to protect customers’ private information at all costs and any
sort of breach in their privacy will be dealt with strict actions including legal action against
the violator.
 Decisions taken at all levels must be in the company’s best interests and they must be in line
with professional business requirement.
 Physical assets such as technical equipment etc. must be handled with care and must not be
used for any illegal purposes.
 Employees must not accept any gifts or briberies and must also refrain from corrupt
practices which will have adverse effect on the performance and image of the company.
 One of the most important factor PTCL focuses on is its whistleblowing Policy. Employees
are encouraged to report any illegal or unlawful means being used by any of the employees
in the company. PTCL also ensures that the name of the person who reports such practices
will be kept confidential by all means and that prompt action will be taken against such
violators. Corrupt practices may include theft, corruption of any sort, forgery of documents,
misuse of any equipment, abuse of position and unethical practices.

Reporting/ Communication channels:

PTCL has laid down an effective system to bridge communication gaps between the lower level
workforce and the top management. Major decisions come from the Top management whereas
lower level decisions are usually taken by the senior engineers who are in charge of specific offices.
The flow of information is both top down and bottom up. PTCL has recently launched eFacilitation
centre which is basically a portal and is accessible to all employees. Employees can give their
feedback on company policies and feedback on their senior management and vice versa for the
senior management team and employees will have a say in how the company should position itself in
the corporate world. The portal is also used for conveying important company announcements to all
the employees. Organizing Focus Group sessions, launching the corporate Magazine and establishing
Facilitation Centres across various Regions are some of the steps undertaken towards breaking the
communication barriers between the headquarters and field units. This online eFacilitation portal
can be accessed through the URL: http://efc.ptcl.net. This is an extremely useful mechanism PTCL
uses to strengthen its inner structure.

Financial Viability:
PTCL Company, without its subsidiaries, reported a Profit of Rs. 8.75 Billion in 2015 compared to Rs.
5.2 Billion in 2014 suggesting a growth of 68%. PTCL Company’s revenue decreased from Rs 75.5
billion in 2015 against Rs 81.5 billion recorded in 2014 which was mainly due to the deregulation of
ICH and decline in EVO subscribers after introduction of 3G/4G services in the country. Growth in
profits were largely due to the voluntary scheme cost PTCL Company incurred in 2014 amounting to

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 a total of Rs. 8.174 Billion. Also, Rs. 9.07 Million worth of property plant and equipment was lost
due to fire in 2014. Higher tax expenses were mainly due to the heavy investment PTCL made in its
subsidiary Ufone for rolling out 3G Services. The government started taxing 3G services which
resultantly increased PTCL’s expenses and so lowered its profits. The taxes still are a burden on PTCL’s
accounts and even though the government announced they will be abolishing GST of 19.5% on 3G
Services no such action has been taken to date. PTCL’s cost of services also decreased by 3% from Rs
55.68 Billion in 2014 to Rs. 53.78 Billion in 2015. Selling and Marketing expenses increased by 7%
due to aggressive marketing of different products in the year 2015.

Ratio Analysis:

PROFITABILITY

The Gross Profit margin declined from 31.6% to 29% in 2015 mainly due to lower revenues recorded
in 2015.

The Net margin increased from 6.39% to 11.56% in 2015. This was mainly due to the fact that PTCL
incurred lesser expenses in 2015, i.e. Rs. 13.29 Billion compared to Rs.21.322 Billion in 2014. Loss of
property due to fire in 2014 was also one of the reasons this ratio has declined over the year.

The Return on Total Assets for PTCL in 2015 was 4.8% and 2.9% in 2014. The ratio has declined over
the year mainly due to higher profits recorded in 2015.

Return on Equity for 2015 stood at 9.8% in 2015 compared to 5.40% in 2014 which indicates an
increase in the return relative to the equity of the company.

LIQUIDITY:

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 The current ratio for 2015 was 1.55 times compared to 1.57 times in 2014. The current ratio is
important for checking the liquidity position for a company. A higher number of this ratio is preferred
since it shows how efficiently a company can cover its current obligations. A current ratio of 2 is
generally preferred which means PTCL’s current ratio was below the recommended figure for the two
years.

Interest Coverage ratio for 2015 was 27.32 times compared to 15.27 times in 2014 which means
PTCL has improve its capability of meeting its interest payments. The improvement was due to the
higher profits recorded in 2015.

LEVERAGE

The Debt to Equity Ratio Deteriorated from 30:70 in 2014 to 32:68 in 2015.

The debt ratio increased by 2% from 47% in 2014 to 49% in 2015.

VALUATION

Earnings per share have also increased from 1.02 in 2014 to 1.72 in 2015. Which is basically the
calculation of how much profit can be allocated to each outstanding stock of that particular company
and is one of the many factors that investors consider before investing in the company.

Dividend per share was declared at Rs. 2 per share compared to Rs. 2.50 Per share in 2014 indicating
a decrease of Rs 0.5 per share. For the year end Dec 2015, the Directors have recommended a final
cash dividend of 10% (Re. 1.0 per share) in addition to the interim cash dividend of 10% (Re. 1.0 per
share). Thus, the total dividends for the year 2015 amounted to 20% (Rs. 2.0 per share).

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