Systems Limited 1HCY26 profit rises 17%

August 27, 2026 (MLN):  Systems Limited (PSX: SYS) reported a 17% increase in its consolidated net profit for the half-year ended June 30, 2026 (1HCY26), reaching Rs6.05bn compared to Rs5.15bn in the corresponding period last year.

Reflecting this bottom-line momentum, the company's basic earnings per share (EPS) rose to Rs3.95 (diluted EPS of Rs3.88) for the six-month period, up from basic EPS of Rs3.52 in 1HCY25.

The primary catalyst behind the performance was strong top-line revenue expansion driven by targeted acquisitions, healthy order backlog, and international market penetration.

Net revenue from contracts with customers surged 35% year-on-year to reach Rs49.72bn, up from Rs36.74bn in 1HCY25.

Recent strategic acquisitions, including Confiz and BAT Shared Services Center, delivered strong top-line contributions, expanding SYS’s footprint with North American enterprise clients.

Although the cost of sales increased by 35% to Rs37.03bn impacted by HR wage inflation of over 12% and currency headwinds gross profit expanded 37% to Rs12.69bn.

On the operational front, overheads expanded to support rapid global expansion. Distribution expenses rose 35% to Rs1.75bn, administrative expenses grew 41% to Rs4.01bn, research and development costs rose to Rs116.64m, and impairment losses on financial assets increased to Rs269.47m.

Despite operational expense inflation, strong gross profit gains propelled operating profit up by 29% to Rs6.54bn.

Below the operating line, SYS absorbed a 31% drop in "other income" (Rs567.05m) alongside an 83% increase in finance costs (Rs303.78m).

Despite these outlays, pre-tax performance was supported by the elimination of associate losses, driving profit before taxation up 20% to Rs6.40bn (after accounting for a statutory levy of Rs397.74m).

The company absorbed an 84% higher corporate taxation charge of Rs354.26m for the period (up from Rs192.48m in 1HCY25).

Supported by robust international growth, AI-driven deal expansions across Middle Eastern and APAC markets, and operational recovery in the domestic segment, Systems Limited securely closed the six-month period with its net profit reaching Rs6.05bn.

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