PECO Reports Wider Losses Despite Improved Cash Position in Half-Year Financial Results
Pakistan Engineering Company Limited (PECO) has announced its financial results for the six-month period ended December 31, 2021, highlighting continued operational challenges while maintaining a stronger cash position. The company disclosed the results following a Board of Directors meeting held on June 6, 2026, and confirmed that no cash dividend, bonus shares, right shares, or other corporate actions were recommended.
Revenue Decline and Increased Losses
During the six-month period, PECO recorded sales revenue of Rs. 68.7 million, a significant decline from Rs. 166.9 million reported during the corresponding period of the previous year. The reduction in sales contributed to a gross loss of Rs. 57.3 million, compared to a gross loss of Rs. 16.4 million in the same period last year.
Operating expenses remained substantial, with administrative expenses amounting to Rs. 15.2 million and freight and forwarding costs reaching Rs. 3.1 million. As a result, the company reported an operating loss of Rs. 72.5 million, compared to an operating loss of Rs. 60.6 million a year earlier.
After accounting for finance costs and taxation, PECO posted a net loss after tax of Rs. 81.9 million for the six months ended December 31, 2021. This compares with a net loss of Rs. 65.1 million during the corresponding period in 2020. Basic and diluted loss per share increased to Rs. 14.40 from Rs. 11.43 in the previous year.
Financial Position Remains Stable
Despite the weaker earnings performance, PECO maintained a relatively stable asset base. Total assets stood at Rs. 15.35 billion as of December 31, 2021, compared with Rs. 15.38 billion at the end of June 2021.
Property, plant, and equipment remained the company’s largest asset category, valued at Rs. 14.46 billion. The company also reported cash and bank balances of Rs. 65.7 million, reflecting an improvement from Rs. 44.6 million recorded six months earlier.
Accumulated losses increased to Rs. 1.90 billion from Rs. 1.83 billion, while total equity remained supported by a substantial surplus on the revaluation of fixed assets amounting to Rs. 14.43 billion.
Positive Cash Flow Performance
One encouraging aspect of the financial results was the company’s operating cash flow. PECO generated net cash from operating activities of Rs. 21.1 million during the period. As a result, cash and cash equivalents increased by Rs. 21.1 million, ending the period at Rs. 65.7 million.
The company reported no significant investing or financing cash flows during the six-month period.
Outlook
The latest results indicate that PECO continues to face significant operational and profitability challenges amid declining sales and rising losses. However, the company’s strong asset base and positive operating cash flow provide some financial stability. Future performance will depend on management’s ability to improve revenue generation, control costs, and enhance operational efficiency in a competitive business environment.
