Gul Ahmed Textile Mills reported a loss after tax of Rs220 million for the fourth quarter of FY26, compared with a profit of Rs2.13 billion in the same period a year earlier.
The company’s loss per share stood at Rs0.29, reversing from earnings per share of Rs2.87 recorded in the corresponding quarter of FY25.
Quarterly Sales Rise Despite Margin Pressure
Sales increased 11 percent year-on-year to Rs36.7 billion, supported by improved demand. However, quarterly sales declined 8 percent compared with the previous quarter, mainly due to weaker home textile exports.
Despite the year-on-year growth in revenue, profitability came under significant pressure as production and operating costs increased.
Gross Profit Falls 32 Percent
Gul Ahmed’s gross profit fell 32 percent to Rs6.78 billion during the quarter.
Gross margins narrowed by 12 percentage points compared with the same period last year as the cost of sales increased sharply. However, margins improved by 5 percentage points from the third quarter, indicating some sequential recovery in cost pressures.
Operating Profit Drops 58 Percent
Operating profit declined 58 percent year-on-year to Rs2.15 billion.
Finance costs provided some relief, falling 13 percent during the quarter. However, the benefit was outweighed by a 20-percentage-point increase in the effective tax rate and a Rs950 million loss from discontinued operations.
These factors pushed the company into a quarterly loss despite higher year-on-year sales.
Full-Year Performance Under Pressure
For FY26, Gul Ahmed Textile Mills recorded sales of Rs162 billion, down 6 percent from the previous year.
The decline reflected weaker demand amid global tensions, which affected business volumes and weighed on the company’s overall performance.
Gross profit decreased 26 percent to Rs23.8 billion, while gross margins declined by 4 percentage points. Higher raw material prices, softer volumes and elevated energy costs placed further pressure on the company’s profitability.
Operating profit was cut by half to Rs7.5 billion.
Finance costs, however, declined 24 percent to Rs5.6 billion. While the reduction provided some support to earnings, it was insufficient to offset the pressure on gross and operating profitability.
FY26 Bottom Line Turns Negative
Profit from continuing operations fell 89 percent to Rs612 million for FY26.
The company also recorded a Rs950 million loss from discontinued operations, resulting in a full-year loss of Rs339 million. This compares with a profit of Rs4.45 billion in FY25.
Loss per share for the year stood at Rs0.45, compared with earnings per share of Rs6.01 a year earlier.
Gul Ahmed did not announce a dividend for FY26.
Textile Earnings Face Multiple Pressures
Gul Ahmed’s FY26 results highlight the pressure facing textile manufacturers as weaker export demand coincides with elevated input and energy costs.
Although quarterly sales increased on a year-on-year basis, the decline in gross and operating profitability shows the impact of higher production costs and softer export volumes.
The company’s full-year loss also demonstrates how quickly textile-sector earnings can reverse when demand weakens and cost pressures remain elevated.