Archroma posts Rs442m profit on strong margins

January 29, 2026 (MLN): Archroma Pakistan Limited (PSX: ARPL) posted a profit after taxation of Rs442.0 million for the quarter ended December 31, 2025, up significantly from Rs355.9m in the same period last year.

Earnings per share (EPS) surged to Rs12.79 compared to Rs10.3 in Q1FY25, showing improved operational efficiency and strong top-line growth.

The company's net sales rose 8.67% YoY to Rs7.84bn, driven by an 8.24% increase in gross sales to Rs9.22bn.

Trade discounts and rebates declined 4.66% YoY to Rs270.7m, while sales tax increased 8.82% to Rs1.11bn, bringing total deductions to Rs1.38bn, up 5.88% YoY.

Cost of sales increased 4.26% YoY to Rs5.81bn, resulting in a gross profit of Rs2.03bn, up a robust 23.65% YoY from Rs1.64bn.

This improvement in gross margin has shown better pricing power and cost management during the quarter.

On the expense side, total operating expenses rose 6.82% YoY to Rs1.23bn. Distribution and marketing expenses increased 8.39% to Rs934.5m, while administrative expenses declined 6.48% to Rs240.6m, showing disciplined cost control.

However, impairment loss on trade receivables surged to Rs3.7m YoY, and other operating expenses jumped 58.57% to Rs55.5m, showing higher provisions and one-off charges.

Consequently, operating profit surged 63.73% YoY to Rs794.3m, demonstrating strong operational leverage.

Other income remained relatively flat at Rs42.2m, down marginally by 1.18% YoY. As a result, profit before finance costs increased 58.49% YoY to Rs836.5m.

Finance costs declined 8.52% YoY to Rs104.5m, benefiting from a lower interest rate environment and improved working capital management.

This brought profit before minimum and final taxes to Rs732.0m, up an impressive 76.98% YoY from Rs413.6m.

After accounting for minimum and final taxes of Rs101.4m, up 10.09% YoY, profit before income tax stood at Rs630.6m, marking a sharp 96.15% increase.

The company booked an income tax charge of Rs188.6m, compared to a reversal of Rs34.6m in the prior year period, resulting in a net profit of Rs442.0m for Q1FY26.

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