Biafo Industries Limited reported a solid improvement in profitability for the nine months ended March 31, 2026, with profit after tax rising to Rs327.6 million, compared with Rs280.6 million in the same period last year.

According to the company’s unaudited condensed interim financial statements, revenue for the nine-month period increased to Rs2.71 billion, up from Rs2.20 billion a year earlier. The increase represents growth of around 23%, indicating stronger overall business activity during the period.

Profitability improves

Biafo’s gross profit climbed to Rs935.1 million during the nine months, compared with Rs770.9 million in the corresponding period of the previous year. However, distribution and administrative expenses also increased, reaching approximately Rs130.0 million and Rs204.4 million, respectively.

Despite the higher operating expenses, the company’s operating profit rose to Rs580.1 million, compared with Rs519.6 million a year earlier.

After accounting for finance costs, workers’ participation and welfare funds, and taxation, Biafo recorded a profit before tax of Rs506.3 million. Profit after tax stood at Rs327.6 million, compared with Rs280.6 million in the same nine-month period last year.

Earnings per share increase

The improvement in earnings was also reflected in the company’s per-share performance. Basic and diluted earnings per share increased to Rs7.06, from Rs6.05 in the nine months ended March 2025.

The stronger earnings position has also contributed to an increase in unappropriated profits, which stood at approximately Rs1.31 billion at March 31, 2026. Total equity was reported at around Rs3.26 billion.

Third quarter shows some pressure

While the nine-month performance remained positive, the results for the latest three-month period were comparatively weaker.

Revenue for the quarter ended March 31, 2026 declined to Rs895.6 million, from Rs973.1 million in the same quarter last year. Gross profit fell to Rs269.3 million, compared with Rs371.1 million previously.

As a result, profit after tax for the quarter dropped to Rs84.7 million, against Rs148.5 million in the corresponding quarter of 2025. Quarterly earnings per share also declined to Rs1.83, from Rs3.20.

Stronger operating cash generation

Biafo’s cash-flow position showed a notable improvement in operating activities. The company generated Rs341.5 million in net cash from operating activities during the nine months, compared with a net outflow of Rs8.4 million in the same period last year.

Cash generated from operations before payments reached approximately Rs646.0 million, although the company made payments related to finance costs, employee benefits, workers’ welfare and participation funds, and income taxes.

The company also invested approximately Rs25.8 million in property, plant and equipment during the period. Financing activities, meanwhile, resulted in a net cash outflow of about Rs328.8 million, largely reflecting dividend and loan-related payments.

Dividend distribution continues

The statement of changes in equity shows that Biafo declared a final cash dividend of Rs3.50 per share for 2025, along with an interim cash dividend of Rs2.50 per share. Total distributions recorded during the period amounted to approximately Rs278.3 million.

Overall, Biafo Industries’ nine-month results point to continued growth in revenue and profitability, supported by stronger operating performance and improved cash generation. However, the weaker third-quarter numbers suggest that the company could face some near-term pressure on margins and earnings.

For investors, the key takeaway is the contrast between the strong nine-month performance and softer quarterly results, making the company’s performance in the final quarter an important indicator of whether the broader earnings momentum can be maintained.