Sana Industries Limited has reported a significant decline in its annual profitability for the financial year ended June 30, 2026, despite recording an improvement in gross profit. The company’s latest financial statements show that lower revenue and increased finance costs weighed on earnings, while changes in operating expenses helped support operating profitability.

Revenue Declines During FY2026

According to the company’s unconsolidated financial results, gross revenue declined to Rs2.13 billion in FY2026 from Rs2.86 billion in the previous financial year. Net revenue fell to Rs1.80 billion compared with Rs2.42 billion in FY2025, reflecting a substantial contraction in sales.

Despite the decline in revenue, gross profit increased to Rs252.06 million from Rs203.36 million a year earlier. The improvement indicates that the company generated a higher gross profit from its remaining sales, supported by a lower cost of sales.

Operating Profit Shows Improvement

Sana Industries reported an operating profit of Rs117.04 million for FY2026, compared with Rs66.38 million in FY2025. Administrative expenses declined to Rs84.31 million from Rs99.13 million, while distribution expenses also decreased to Rs34.14 million from Rs37.84 million.

These reductions helped improve operating performance despite the lower revenue base. However, finance costs increased to Rs129.35 million from Rs192.98 million?

Finance Costs and Taxation Affect Earnings

Finance costs remained a major pressure on the company’s financial performance, amounting to Rs129.35 million in FY2026. After accounting for other income and finance costs, the company reported a loss of Rs65.77 million before levies and taxation, compared with a profit of Rs134.38 million in the previous year.

Following levies and taxation, unconsolidated profit after taxation stood at Rs35.25 million, down from Rs111.43 million in FY2025. Earnings per share also declined to Rs1.77 from Rs5.58.

Consolidated Results Reflect a Similar Trend

The consolidated financial statements showed gross revenue of Rs2.74 billion for FY2026, compared with Rs4.10 billion in FY2025. Net revenue declined to Rs2.33 billion from Rs3.45 billion.

Consolidated gross profit, however, increased to Rs307.33 million from Rs265.08 million. Operating profit rose to Rs100.69 million from Rs20.26 million, reflecting the impact of lower operating expenses.

Nevertheless, consolidated finance costs increased to Rs130.43 million from Rs203.32 million, while profit before levies and taxation declined to Rs57.86 million from Rs165.96 million.

Consolidated profit after taxation fell to Rs33.29 million from Rs91.76 million. Earnings per share decreased to Rs1.90 from Rs4.58, highlighting the pressure on shareholder earnings during the year.

Financial Position and Cash Flow

As of June 30, 2026, Sana Industries reported consolidated total assets of approximately Rs3.00 billion, compared with Rs2.84 billion a year earlier. Cash and bank balances increased to Rs271.15 million from Rs21.38 million, indicating a substantial improvement in the company’s year-end cash position.

The consolidated cash flow statement also showed net cash generated from operating activities of approximately Rs218.62 million, compared with net cash used in operating activities of Rs130.66 million in FY2025. This improvement in operating cash flow provides a positive aspect of the company’s financial performance.

At the same time, the balance sheet reflected significant short-term borrowings and other current liabilities, making liquidity management and financing costs important considerations for the company.

Outlook

Sana Industries’ FY2026 results present a mixed picture. Higher gross profit, improved operating profit and stronger operating cash flow are encouraging developments. However, declining revenue, lower net earnings and reduced earnings per share remain key challenges.

The company’s future performance will depend on its ability to strengthen sales, maintain cost discipline, manage financing expenses and sustain cash generation. Investors will likely monitor these factors closely in assessing the company’s financial outlook.