Lucky Core Industries (LCI) closed FY26 with lower earnings as weaker soda ash exports and pressure on its polyester business outweighed growth in pharmaceuticals and animal health.
The company’s financial performance reflected a challenging operating environment, particularly in its chemicals-related businesses, while its healthcare and animal-health segments provided some support.
Lucky Core Earnings and Dividend Decline
Lucky Core Industries reported earnings per share of Rs21.1 for FY26, down from Rs25.5 a year earlier.
The company also reduced its dividend to Rs10.5 per share from Rs13 per share in the previous year.
Net sales declined 5 percent to Rs113.4 billion, while profit after tax fell 17 percent to Rs9.7 billion. Operating profit also decreased 18 percent to Rs14.7 billion.
The company’s gross margin narrowed to 21.7 percent from 22.9 percent, reflecting pressure on profitability across key businesses.
The fourth quarter provided a more positive trend. Profit after tax rose 14 percent year on year to Rs3.2 billion, while the company declared a dividend of Rs5.25 per share.
Soda Ash Business Faces Export and Pricing Pressure
Soda ash remained one of the biggest drags on Lucky Core’s FY26 performance.
Soda ash turnover declined 9 percent, while total volumes fell to 424,000 tons from 452,000 tons a year earlier. Fourth-quarter sales were also weaker, with volumes of 98,000 tons, down 12 percent year on year.
Exports suffered the sharpest decline, falling 59 percent during the year. Although local volumes increased 6 percent, the improvement was insufficient to compensate for the loss of export demand.
Lucky Core realised approximately Rs88,000 per ton compared with market prices of Rs96,000 to Rs100,000. The lower realisation reflected heavier discounts required to compete with cheaper imported material.
Chinese soda ash cargoes averaged around $190 per ton on a cost-and-freight (CFR) basis, adding to competitive pressure in the domestic market.
Polyester Margins Come Under Severe Pressure
The polyester business also remained under significant pressure.
Polyester volumes declined 3 percent to 97,000 tons, while segment operating profit plunged 74 percent to Rs479 million.
Cheaper imported fibre put pressure on domestic pricing and margins. Imported fibre landed at approximately Rs330 per kilogram, compared with local prices of around Rs365 per kilogram.
The price gap made it difficult for the local business to maintain margins and contributed to the sharp decline in segment profitability.
Pharmaceuticals Provide Support
Lucky Core’s pharmaceutical business delivered comparatively stronger results during FY26.
Pharmaceutical sales increased 5 percent, while operating profit rose 16 percent. The full-year contribution from the Pfizer acquisition helped support the segment, alongside price increases for the company’s non-essential product range.
Non-essential products account for around 70 percent of the pharmaceutical mix.
However, the closure of the Afghan border continued to affect volumes, which declined 1 percent during the year.
Animal Health Business Records Strong Growth
The animal health segment also delivered solid growth during FY26.
Sales increased 17 percent, while operating profit grew 20 percent, supported by stronger poultry and livestock offtake, increased brand spending and a shift toward higher-margin products.
Lucky Core’s new medicine plant has also become operational and is expected to contribute additional volumes going forward.
Soda Ash and Float Glass Expansion Projects Remain Paused
Weak demand and competition from imports have led Lucky Core to keep its planned soda ash expansion on hold.
The proposed 200,000-ton expansion was estimated to require an investment of around $140 million. The company has paused the project because of subdued demand conditions and the threat posed by imported soda ash.
The planned float glass project with Tariq Glass has also been suspended.
The company continues to face different energy-cost dynamics across its businesses. Soda ash production operated on a 50:50 mix of local and imported coal, while the polyester business used gas comprising 75 percent indigenous supply and 25 percent RLNG.
Outlook Remains Mixed for Lucky Core
Lucky Core’s FY26 results highlight the uneven performance across its business portfolio.
Soda ash and polyester faced pressure from weaker exports, cheaper imports and tighter margins, while pharmaceuticals and animal health delivered growth and helped cushion the overall earnings decline.
With major expansion projects currently on hold, the performance of existing businesses, recovery in export demand and competitive conditions in imported chemicals and polyester fibre will remain important factors for Lucky Core’s earnings outlook.