Export Pullback Drags Gul Ahmed Revenue Down 17%

Gul Ahmed Textile Mills Limited’s revenue declined 17% to Rs131 billion in FY26, primarily due to the closure of its export apparel segment, a six-month suspension of spinning operations and the exit from unviable home textile customer accounts, according to a research report by Taurus Securities.

The company had reported net sales of Rs157.8 billion in FY25. Its financial performance deteriorated further in FY26 as net profit turned into a loss of Rs922 million, compared with a profit of Rs4.02 billion in the preceding fiscal year.

Gross profit margins also contracted by 4.7 percentage points year-on-year to 7.3%, reflecting higher manufacturing costs and operational pressures.

According to Taurus Securities, the decline in revenue was partly driven by the company’s decision to close its Export Apparel segment and strategically curtail spinning operations for six months. It also exited non-viable home textile customer accounts as part of its business restructuring.

Unabsorbed fixed manufacturing overheads and elevated fuel tariffs further squeezed margins, while lower revenue and higher operating costs contributed to the overall net loss.

Segment-wise, home textiles remained the largest contributor, generating Rs85 billion in FY26, down 7.8% year-on-year. The spinning segment recorded sales of Rs33 billion, declining 23%, while other segments posted combined revenue of Rs11 billion, up 20%.

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Made-ups remained the largest product category, generating Rs84 billion in sales, followed by yarn at Rs26 billion and fabric at Rs5 billion.

Geographically, Pakistan was the company’s largest single market, contributing Rs41 billion to gross sales. Germany followed with Rs24 billion, while the UK and the United States contributed Rs11 billion and Rs10 billion, respectively.

Meanwhile, the company is pursuing a major transition towards renewable energy to reduce its dependence on expensive conventional power sources.

It plans to develop 72.25 megawatts of renewable energy capacity, comprising 44MW of solar and 28.25MW of wind power, alongside 50 megawatt-hours of battery storage at its Landhi and Nooriabad facilities.

The project involves Rs9.7 billion in renewable energy capital expenditure and Rs7.75 billion for land and construction. It is expected to generate 133 gigawatt-hours of electricity annually, with completion targeted by the end of FY27.

The management also plans to obtain Rs10 billion through the government’s long-term financing facility.