First Al-Noor Modaraba Posts Rs2.8 Million Loss in FY2026 as Revenue Declines
First Al-Noor Modaraba, an Islamic financial institution, reported a loss after taxation of Rs2.80 million for the year ended June 30, 2026, compared with a profit after taxation of Rs2.41 million in the previous financial year, according to its Annual Report 2026.
The Modaraba generated net revenue of Rs35.14 million during FY2026, down from Rs43.66 million in FY2025. Trading operations contributed Rs18.31 million, while income from investments stood at Rs16.76 million. Profit from the Diminishing Musharakah facility amounted to Rs0.08 million.
Trading Operations Remain a Key Contributor
The annual report shows that First Al-Noor Modaraba’s commodity trading operations improved during the first half of FY2026. However, conditions became more difficult during the latter part of the year.
According to the directors’ report, disruptions linked to the Middle East crisis, including interruptions to regional shipping routes and the Strait of Hormuz, increased freight, insurance and logistics costs. Shipment delays and uncertainty over delivery schedules also affected inventory replenishment and working-capital cycles.
Despite these challenges, the Modaraba recorded a turnover of Rs35 million, while management said it remained focused on its core activities and operational efficiency.
Investment Income Declines
Investment income was another important component of the Modaraba’s earnings, but it declined substantially during the year. Income from investments fell to Rs16.76 million in FY2026 from Rs25.65 million in FY2025. At the same time, the company recorded an unrealised loss of Rs6.78 million on investments measured at fair value through profit or loss.
Administrative and operating expenses increased to approximately Rs37.72 million, compared with Rs36.50 million a year earlier. Other income, however, rose to Rs7.07 million from Rs2.63 million.
Asset Base Remains Around Rs275 Million
First Al-Noor Modaraba’s total assets stood at approximately Rs274.58 million as of June 30, 2026, broadly unchanged from the previous year. Current assets amounted to Rs231.25 million, including stock in trade of Rs105.82 million and cash and bank balances of Rs69.96 million.
The company’s total liabilities increased to Rs18.38 million, compared with Rs15.82 million in FY2025. Certificate holders’ equity stood at approximately Rs255.78 million at the end of the reporting period.
No Cash Dividend Declared
The annual report states that no cash dividend was declared for FY2026, consistent with FY2025. Earnings per certificate declined to a loss of Rs0.12, compared with earnings of Rs0.10 per certificate in FY2025. The net assets/breakup value per certificate stood at Rs11.07 at year-end.
Outlook for FY2027
Looking ahead, management said it remains cautiously optimistic about FY2027. The Modaraba expects improving domestic economic conditions and possible normalization of international trade routes to support commodity trading activity, while also identifying selective opportunities in the equity market.
Management has highlighted prudent risk management, liquidity and capital preservation, and disciplined investment and trading decisions as priorities for the coming year.
The annual report also emphasizes Shariah governance as a central part of the Modaraba’s operations. It states that business activities, products, transactions and financial practices are conducted according to Shariah principles, with oversight from its Shariah Advisor.
Overall, FY2026 was a challenging year for First Al-Noor Modaraba, with lower revenue, reduced investment income and an after-tax loss. The company’s management is looking toward improved trading conditions and disciplined operations as it enters FY2027.
