Nazir Cotton Mills Reports Loss as Board Moves to Monetize Surplus Land

Nazir Cotton Mills Limited has reported a weaker financial performance for the nine-month period ended March 31, 2026, with the company posting a loss after benefiting from a profit in the corresponding period last year.

According to the company’s financial results, Nazir Cotton Mills recorded a loss after tax of Rs6.31 million for the nine months ended March 31, 2026, compared with a profit of Rs25.76 million in the same period of the previous year. This translated into a loss per share of Rs0.27, against earnings per share of Rs1.12 previously.

The company did not report any sales or cost of sales during the period. Instead, its income was mainly generated through other sources, including gains and income related to its assets. Other income stood at approximately Rs1.64 million during the nine-month period, compared with Rs63.45 million a year earlier.

Administrative and general expenses also remained significant, reaching Rs7.08 million, while finance costs amounted to around Rs864,458. As a result, Nazir Cotton Mills reported a loss before taxation of Rs6.31 million.

Quarterly Performance Also Remains Under Pressure

The company’s performance during the third quarter was also weaker. For the quarter ended March 31, 2026, Nazir Cotton Mills reported a loss after tax of Rs809,864, compared with a loss of Rs3.76 million in the same quarter last year.

The quarterly loss per share stood at Rs0.16, unchanged from the corresponding period in 2025.

Surplus Land Disposal Planned

Alongside the financial results, the company disclosed an important strategic decision by its Board of Directors.

The board has decided to dispose of the company’s surplus land, subject to approval from shareholders, with the proceeds intended to be deployed into profitable avenues. The company said that notice of the Extraordinary General Meeting (EGM) will be circulated to members in due course.

The move could provide Nazir Cotton Mills with an opportunity to unlock value from assets that are not currently being used productively. However, the proposed transaction remains subject to shareholder approval.

Financial Position

As of March 31, 2026, the company reported total assets of approximately Rs289.30 million, compared with Rs289.43 million as of June 30, 2025.

The company’s cash and bank balances stood at just Rs159,328 at the end of March, down from Rs286,188 at the end of the previous financial year. Short-term borrowings remained unchanged at approximately Rs131.14 million.

Total equity declined to around Rs131.05 million from Rs137.37 million, largely reflecting the loss recorded during the nine-month period.

Cash Flow Shows Improvement

Despite the reported loss, the company’s cash flow from operating activities showed an improvement. Nazir Cotton Mills generated net cash of Rs710,990 from operating activities during the nine months, compared with a net cash outflow of Rs9.17 million in the corresponding period last year.

The improvement was supported by changes in working capital, particularly an increase in trade and other payables.

Outlook

Nazir Cotton Mills’ latest results highlight the challenge facing the company as it moves from a sizeable profit last year to a loss in the current period. With no sales reported in the financial statements and earnings largely dependent on other income, the company’s decision to dispose of surplus land could become an important part of its strategy to strengthen its financial position.

The effectiveness of this plan will ultimately depend on shareholder approval, the value realized from the land disposal and how successfully the proceeds are invested in profitable activities.

Note: The financial statements are marked un-audited and cover the nine-month period ended March 31, 2026.