Khairpur Sugar Mills Posts 42% Rise in Nine-Month Profit Despite Decline in Sales

KARACHI: Khairpur Sugar Mills Limited (PSX: KSML) reported a strong improvement in profitability for the nine months ended June 30, 2026, with net profit rising by over 42% year-on-year, despite recording lower sales during the period. The financial results were disclosed in the company’s condensed interim financial statements.

According to the financial statements, the company’s net sales declined to Rs5.12 billion during the nine-month period, compared with Rs8.74 billion in the corresponding period last year. Cost of sales also fell significantly, enabling the company to post a higher gross profit of Rs858.68 million, up from Rs821.72 million a year earlier.

Operating profit improved to Rs510.97 million, compared with Rs499.07 million in the same period last year. After accounting for other income, financial charges, and taxation, profit after tax increased to Rs144.84 million, marking a 42% increase from Rs101.97 million recorded in the corresponding period of FY2025. Earnings per share (EPS) also strengthened to Rs9.05, compared with Rs6.37 last year.

For the third quarter alone, Khairpur Sugar Mills posted a net profit of Rs22.72 million, up from Rs19.83 million in the same quarter last year, while quarterly EPS improved to Rs1.42 from Rs1.24.

On the balance sheet, the company’s total assets increased to Rs13.06 billion as of June 30, 2026, from Rs10.68 billion at the end of September 2025. Shareholders’ equity also improved to Rs5.15 billion, supported by higher accumulated profits during the reporting period.

Cash flow from operating activities remained under pressure, with the company reporting a net operating cash outflow of Rs2.04 billion, primarily due to increased working capital requirements, particularly higher inventories. Financing activities, including additional short-term borrowings, helped support liquidity during the period.

The latest results indicate that while Khairpur Sugar Mills faced a challenging sales environment, improved cost management and operational efficiency enabled the company to deliver stronger profitability and higher returns to shareholders during the first nine months of FY2026.