SAZEW declares Rs5 dividend

MG News | October 27, 2026 at 10:40 AM GMT+05:00

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October 27, 2026 (MLN): Sazgar Engineering Works Limited (PSX: SAZEW) reported a 9% decline in its net profit for the first quarter ended September 30, 2026 (1QFY27 / 3MFY27), recording Rs4.04bn compared to Rs4.42bn in the corresponding period last year.

Alongside the financial results, the board announced an interim cash dividend of Rs5per share.

Reflecting this bottom-line compression, basic and diluted earnings per share (EPS) for the quarter contracted to Rs66.77, down from Rs73.07 in 1QFY26.

The primary factors behind the performance were significant cost of sales inflation and an expansion in distribution and finance costs, which outweighed a 23% growth in top-line net sales.

Net sales for the quarter rose 23% to Rs41.71bn, up from Rs33.82bn in 1QFY26. However, cost of sales escalated 31% to Rs33.20bn (up from Rs25.30bn), causing gross profit to hold flat at Rs8.51bn (compared to Rs8.52bn in 1QFY26).

Distribution and marketing costs surged 72% to Rs1.66bn (up from Rs964.06m), while administrative expenses rose 6% to Rs218.29m, offset slightly by a 10% drop in other operating expenses to Rs486.78m. This reduced operating profit by 10% to Rs6.15bn.

Below the operating line, SAZEW saw "other income" rise 22% to Rs628.66m (up from Rs513.72m). However, finance costs surged to Rs333.55m up from Rs79.23m in 1QFY26), pulling profit before taxation down 11% to Rs6.44bn.

The company recorded a corporate taxation expense of Rs2.41bn for the quarter (down 15% from Rs2.83bn in 1QFY26). Supported by massive vehicle dispatches and treasury earnings, Sazgar Engineering Works Limited closed the first quarter with a robust net profit of Rs4.04bn.

STATEMENT OF PROFIT OR LOSS FOR THREE MONTHS ENDED SEPTEMBER 30, 2026 (Rs.)
Description	2026	2025	change %
Sales - net	41,711,147,735	33,824,586,046	23.3%
Cost of sales	(33,196,788,036)	(25,303,158,669)	31.2%
Gross profit	8,514,359,699	8,521,427,377	-0.1%
Distribution and marketing costs	(1,661,685,437)	(964,061,415)	72.4%
Administrative expenses	(218,291,625)	(206,482,500)	5.7%
Other operating expenses	(486,780,515)	(542,134,823)	-10.2%
Operating expenses subtotal	(2,366,757,577)	(1,712,678,738)	38.2%
Operating Profit	6,147,602,122	6,808,748,639	-9.7%
Other income	628,656,426	513,724,814	22.4%
Finance cost	(333,554,682)	(79,225,740)	321.0%
Profit before Levy and Taxation	6,442,703,867	7,243,247,713	-11.1%
Levy / final taxation	-	-
Profit before Taxation	6,442,703,867	7,243,247,713	-11.1%
Taxation	(2,407,013,259)	(2,826,235,320)	-14.8%
Net profit for the period	4,035,690,608	4,417,012,393	-8.6%
Earnings / (Loss) per share - basic and diluted (Rupees)	66.77	73.07	-8.6%

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