SGF profit more than doubles to nearly Rs2.5bn in 1HCY26

August 27, 2026 (MLN): Service Global Footwear Limited (PSX: SGF) recorded a 116% increase in its consolidated net profit for the half year ended June 30, 2026, with profit after taxation more than doubling to Rs2.47bn from Rs1.14bn in the corresponding period last year.

Showing this exceptional bottom-line growth, the company's basic earnings per share (EPS) expanded to Rs11.95 from Rs5.54 in 1HFY25, while diluted EPS rose to Rs11.87 from Rs5.50.

The top-line came under pressure, with revenue declining 15% year-on-year to Rs8.13bn from Rs9.57bn in the prior period.

Cost of sales fell at a faster pace of 18% to Rs6.32bn, limiting gross profit decline to a marginal 2% at Rs1.81bn from Rs1.84bn showing improved cost management that partially offset the revenue contraction.

On the expenditure side, distribution cost declined 16% to Rs805.33m, and administrative expenses rose 5% to Rs451.06m. Other expenses, however, surged to Rs269.54m from just Rs49.15m a more than fivefold increase emerging as a notable drag.

Total operating expenses rose 6% to Rs1.53bn. Other income grew 14% to Rs149.24m. These combined movements pulled operating profit down 30% to Rs283.22m from Rs404.50m, and profit from operations declined 19% to Rs432.46m from Rs535.29m.

Finance cost declined 27% to Rs194.08m from Rs265.83m, providing meaningful relief and keeping the profit before share of equity investee income at Rs238.37m, down 12%.

The decisive catalyst that transformed the earnings picture was a near-doubling of share of profit from the equity accounted investee net of taxation which surged 91% to Rs2.23bn from Rs1.16bn, more than compensating for the operational softness and propelling profit before taxation and levy to Rs2.47bn from Rs1.43bn, a gain of 72%.

Levy rose 7% to Rs44.40m, bringing profit before taxation to Rs2.42bn, up 74% from Rs1.39bn.

A further positive development was a swing in the taxation line.

Against a tax charge of Rs251.996m in the prior period, the company recorded a tax credit of Rs44.65m in the current period providing an additional boost that amplified the bottom-line result and delivered the 116% surge in profit after taxation for the half year.

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