Ittehad Chemicals profit rises 26% in 1HFY26

February 17, 2026 (MLN): Ittehad Chemicals Limited (PSX:ICL)  reported a net profit of Rs774.5m for the half year ended December 31, 2025, which represents a 26% increase from the Rs614.4m profit recorded in the same period last year.

The company's earnings per share rose to Rs7.75 from Rs6.14 in the corresponding period of the previous year, dividend came in at Rs1 per share.

The chemical manufacturer's revenue from contracts with customers increased 21% YoY to Rs15.86bn from Rs13.14bn, demonstrating strong top-line growth driven by healthy demand for its chemical products.

Cost of sales rose 25% to Rs13.29bn from Rs10.66bn, resulting in a gross profit of Rs2.57bn, up 3% from Rs2.48bn in the prior period.

The gross profit margin declined to 16.2% from 18.9% in H1 FY2025, indicating margin compression as cost of sales grew faster than revenue.

The net profit margin stood at 4.9% compared to 4.7% in the same period last year, reflecting a slight improvement in overall profitability despite the squeezed gross margins.

Selling and distribution expenses declined 6% to Rs769.9m from Rs822.3m, demonstrating effective cost rationalisation in commercial activities.

General and administrative expenses rose 8% to Rs205.1m from Rs190.2m, while other operating income surged 85% to Rs91.5m from Rs49.5m, providing additional support to profitability.

Other operating expenses increased 34% to Rs111.2m from Rs82.8m. Operating profit grew 9% to Rs1.57bn from Rs1.44bn in H1 FY2025, which reflects solid operational performance despite pressure on gross margins.

Financial charges declined 13% to Rs306.9m from Rs352.2m, providing meaningful relief.

Profit before income tax and levy reached Rs1.26bn, up 16% from Rs1.09bn in the prior period.

Profit before income tax stood at Rs1.26bn, representing a 17% increase from Rs1.08bn in the corresponding period last year.

The company recorded a taxation expense of Rs489m, up 5% from Rs464.8m, with the modest increase in tax charge allowing the strong pre-tax growth to flow through to the bottom line.

The company's 26% profit growth reflects strong revenue momentum, effective management of operating costs, and the benefit of lower financial charges in a declining interest rate environment.

Additionally, the company plans to invest up to Rs1 billion, from time to time, in an associated/related company to explore opportunities in biomass collection, processing, storage and delivery services, primarily to support its wholly owned subsidiary ICL Power (Pvt.) Limited as well as other marketing prospects.

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