KARACHI: Waves Home Appliances Limited (PSX: WAVESAPP) reported a modest improvement in profitability for the first quarter of FY2026, posting a net profit of Rs63.86 million for the three months ended March 31, 2026, compared to Rs60.23 million in the same period last year, reflecting a year-on-year increase of around 6%. Earnings per share (EPS) improved to Rs0.24, up from Rs0.22 a year earlier.

The company’s net sales rose to Rs1.002 billion, slightly higher than Rs989.30 million recorded in the corresponding quarter of 2025. However, gross profit remained largely unchanged at Rs274.11 million, as higher sales were offset by an increase in the cost of goods sold.

Operating performance faced some pressure during the quarter. Profit from operations declined to Rs216.30 million from Rs295.72 million in the same period last year. One of the key reasons was a sharp rise in finance costs, which climbed to Rs145.24 million compared with Rs92.81 million a year earlier, significantly impacting the company’s bottom line.

Despite the increase in borrowing costs, Waves Home Appliances benefited from a substantial reduction in income tax expense. The company recorded a tax credit of Rs5.59 million, compared with an income tax expense of Rs30.32 million in the corresponding quarter of the previous year, helping support net earnings.

The company’s financial position also strengthened during the quarter. Total assets increased to approximately Rs19.92 billion as of March 31, 2026, compared with Rs19.56 billion at the end of December 2025. Cash and bank balances also improved significantly, rising to Rs274.15 million from Rs17.97 million at the beginning of the quarter, supported by healthy operating and financing cash flows.

The Board of Directors did not announce any cash dividend, bonus shares, or rights issue along with the quarterly results.

While higher financing costs continue to weigh on profitability, the company’s stable sales growth, improved liquidity position, and positive earnings indicate resilience amid a challenging business environment. Investors will likely watch upcoming quarters to see whether Waves Home Appliances can sustain revenue growth while managing its financing expenses more effectively.