KARACHI - The corporate earnings of Karachi stock exchange (KSE) during first quarter of FY08 stood at Rs 52.4 billion (US$787mn) as compared to Rs 52.8 billion (US$793mn) in 1Q2007, reflecting decline of 1 per cent Year on Year basis. While on the other hand the Quarter on Quarter basis, 1Q2008 profits soared by 69 percent from 4Q2007. The analysis is based on the listed companies that account for approxiametly 75 percent of the total market cap of KSE 100 index. The cumulative earnings of selected companies witnessed a slight decline of 1 percent. Support in earnings was provided by sectors like OMCs, Fertilizer, E&P and Cement. OMCs posted a healthy growth of 120 percent in profitability on account of higher product margins and huge inventory gains. Next best growth of 37 percent was witnessed in the fertilizer sector owing to better product prices in the local market and higher offtake. Similarly, cement sector also showed a growth of 37 percent primarily due to high profits of Lucky Cement, a company oriented towards export sales. Another sector that showed positive earnings growth was E&P up by 12 percent). Insurance, Auto, Banks and Telecom sectors have been sluggish during the period under review. Insurance sector showed the worst performance as its profits decreased by 64 percent, mainly on account of riots in the country during December 2007, resulting in higher claims for insurance companies. Political uncertainty also affected the Auto sector, sales of which declined considerably. Moreover, weak rupee and rising steel prices also dampened Auto sectors profits as they fell by 47 percent. The heavy weight Banking sector depicted a decline of 18 percent in its earnings. This decline is largely attributed to the poor results of Bank of Punjab (BoP) as it carried out high provisioning during the period. Excluding BoP, total banking sector earnings were up by 1 percent.