Tri-Pack Films Limited has reported a significant financial turnaround for the nine months ended September 30, 2026, posting a net profit of Rs339.44 million compared to a net loss of Rs372.89 million recorded in the corresponding period last year.
According to the company’s latest quarterly financial report, revenue increased by 7% to Rs24.89 billion, compared to Rs23.28 billion in the same period of 2025. The increase primarily reflected the pass-through of higher raw material costs, although overall sales volumes declined amid challenging domestic and international market conditions.
The company’s gross profit rose by 30% to Rs4.19 billion, up from Rs3.21 billion last year. Gross profit margin also improved to 17%, compared to 14% in the corresponding period, supported by proactive pricing strategies and operational efficiencies despite higher raw material costs and continued Grid Levy pressures.
Operating profit increased to Rs2.31 billion from Rs1.64 billion, reflecting improved operational performance. Meanwhile, finance costs declined to Rs1.91 billion from Rs2.05 billion, providing some relief amid the company’s financing requirements.
A significant contribution to the reported profitability came from a one-time gain of approximately Rs599.45 million arising from the remeasurement of the Sindh Infrastructure Development Cess (SIDC) liability following its settlement agreement with the Government of Sindh. This gain was reflected in other income.
Consequently, profit before tax and levies reached Rs1.19 billion, compared to a loss of Rs158.41 million in the corresponding period last year. Earnings per share also improved to Rs8.75 against a loss per share of Rs9.61 previously.
However, the company faced challenges during the third quarter. For the quarter ended September 30, 2026, Tri-Pack recorded a net loss of Rs22.19 million compared to a profit of Rs95.32 million in the same quarter of the previous year.
Market Challenges and Operational Pressures
Tri-Pack Films highlighted that geopolitical tensions in the Middle East disrupted raw material supplies, forcing suppliers to declare force majeure and pushing the company towards higher-cost spot purchases.
The domestic market also experienced increased competition due to higher imports of films from China and additional local production capacity. On the export front, elevated freight costs and logistics surcharges affected the company’s price competitiveness against regional competitors.
Despite these challenges, management successfully improved gross margins through pricing adjustments and operational efficiencies.
SIDC Settlement Provides Financial Relief
During the reporting period, Tri-Pack Films entered into a settlement agreement with the Government of Sindh under the amended Sindh Development and Maintenance of Infrastructure Cess Act, 2026.
Under the agreement, the company paid 15% of the outstanding liability on April 20, 2026, with another 15% due by October 15, 2026. A further 15% is payable by July 15, 2027, while the remaining balance will be settled through 48 equal quarterly instalments beginning July 15, 2028.
The settlement also resulted in the application of a reduced infrastructure cess rate of 0.85%. The company recognized a remeasurement gain of approximately Rs599 million as a result of the revised settlement arrangements.
Future Outlook
Looking ahead, Tri-Pack Films expects the operating environment to remain challenging due to geopolitical uncertainty, supply chain disruptions, higher input costs, energy-related levies and inflationary pressures.
The company also highlighted that the BOPP film industry has filed a petition with the National Tariff Commission seeking anti-dumping investigations into Chinese imports.
Meanwhile, export volumes have started showing improvement as demand picks up ahead of seasonal purchasing activity. Management intends to focus on efficient resource utilization, operational improvements and strengthening the company’s ability to respond to changing market conditions.
The Board remains committed to improving business resilience, protecting shareholder value and maintaining sustainable growth despite prevailing economic and industry challenges.
Overall, Tri-Pack Films’ return to profitability represents an improvement in its financial performance. However, investors will need to monitor future operating earnings, sales volumes, finance costs and the sustainability of improved margins, particularly considering the significant one-time gain recognized during the reporting period.
