Biafo Industries Limited has reported a decline in profitability for the quarter ended September 30, 2026, as lower revenue and higher operating costs weighed on its financial performance. The company’s unaudited financial results show that net profit fell to Rs100.74 million from Rs154.40 million in the corresponding quarter last year.

Revenue Declines, Profitability Comes Under Pressure

According to the company’s financial statements submitted to the Pakistan Stock Exchange (PSX) on October 22, 2026, Biafo Industries recorded net revenue of Rs865.39 million during the quarter, compared with Rs1.12 billion in the same period last year.

This represents a decline of approximately 22.6% in revenue, reflecting weaker sales during the reporting period.

The company’s cost of sales decreased to Rs599.73 million from Rs680.67 million. However, the reduction was not sufficient to offset the impact of lower revenue, resulting in a decline in gross profit to Rs265.66 million from Rs436.98 million a year earlier.

Operating Profit Drops Significantly

Biafo Industries’ operating profit declined to Rs176.31 million in the quarter, compared with Rs272.84 million in the corresponding period last year.

The financial statements also showed distribution expenses of Rs18.12 million and administrative expenses of Rs75.23 million. The company recorded a net impairment reversal of Rs4 million on financial assets, which provided some support to its operating performance.

Meanwhile, net finance cost stood at Rs5.30 million, compared with Rs24.49 million in the same quarter last year, indicating a substantial reduction in the company’s net financing burden.

Net Profit Falls to Rs100.74 Million

Despite lower finance costs, Biafo Industries’ bottom line remained under pressure. Profit before tax declined to Rs159.65 million from Rs231.52 million in the previous year’s corresponding quarter.

After income tax expenses of Rs58.91 million, the company posted net profit of Rs100.74 million, down approximately 34.7% year-on-year.

Earnings per share (EPS) also declined to Rs2.17 from Rs3.33 in the same period last year, reflecting the reduction in overall profitability.

Financial Position and Cash Flows

The company’s statement of financial position showed total assets and net assets remained supported by its property, plant and equipment, inventories, and other current assets. As of September 30, 2026, property, plant and equipment stood at Rs2.21 billion, while inventories amounted to Rs624.14 million.

However, cash flow figures highlighted pressure on liquidity. Biafo Industries reported net cash used in operating activities of Rs147.15 million during the quarter, compared with net cash generated of Rs119.08 million in the corresponding period last year.

The company also reported negative cash and cash equivalents of Rs160.40 million at the end of the period, compared with negative Rs288.96 million a year earlier.

No Cash Dividend or Bonus Shares Announced

The company’s board of directors, at its meeting held on October 22, 2026, did not recommend any cash dividend or bonus shares for the quarter ended September 30, 2026.

The company stated that its detailed quarterly report would be submitted separately through the Pakistan Unified Corporate Action Reporting System (PUCARS).

Outlook

Biafo Industries’ latest results highlight the challenges posed by declining revenue and lower gross margins. Although the company benefited from reduced finance costs, this improvement was not enough to prevent a significant decline in quarterly earnings.

Investors will likely monitor the company’s upcoming financial disclosures for further information about sales trends, cost management, working capital and cash flow performance. Its ability to improve revenue and strengthen operating cash generation will remain important factors in assessing its financial performance in the coming quarters.