NML FY26 profit softens 9%

September 30, 2026 (MLN): Nishat Mills Limited (PSX: NML) reported a 9% decline in its net profit for the fiscal year ended June 30, 2026, recording Rs5.48bn compared to Rs6.01bn in the preceding year.

Alongside the financial results, the board recommended a final cash dividend of Rs2.00 per share.

Reflecting this bottom-line compression, basic and diluted earnings per share (EPS) for the year fell to Rs15.59, down from Rs17.10 in FY25.

The primary factors weighing on operational performance were higher direct costs of sales and a 30% decline in non-operating income, which offset modest top-line revenue growth.

Net revenue expanded 2% year-on-year to Rs181.64bn, up from Rs178.17bn in FY25.

However, direct cost of sales grew 4% to Rs163.91bn, causing gross profit to compress 11% to Rs17.74bn compared to Rs20.02bn in the prior year.

On the operational front, overheads expanded across administrative and distribution heads. Distribution costs rose 4% to Rs8.37bn, administrative expenses grew 8% to Rs3.16bn, and other expenses surged 31% to Rs192.11m.

Coupled with a 30% drop in "other income" (falling to Rs7.19bn from Rs10.20bn), operating profit dropped 31% to Rs13.21bn.

Below the operating line, NML gained significant relief on debt-servicing outlays.

Finance costs plummeted 24% to Rs6.38bn (down from Rs8.43bn in FY25). Profit before taxation and levy stood at Rs6.83bn, while statutory levies absorbed Rs2.07bn, resulting in profit before taxation of Rs4.75bn.

The company benefited from a major tax credit of Rs729.72m for the year (compared to an income tax expense of Rs2.65bn in FY25).

Supported by finance cost relief and a net tax reversal, Nishat Mills Limited absorbed gross margin pressure and non-operating income drops to close the fiscal year with a net profit of Rs5.48bn.

Copyright Mettis Link News