Fertiliser maker reports lower earnings amid weaker sales, while reducing operating costs and maintaining shareholder payouts.
KARACHI: Engro Fertilizers Limited reported a 32% year-on-year decline in net profit for the quarter ended June 30, 2026, as weaker sales weighed on earnings despite lower operating and administrative expenses.
According to the consolidated financial statements submitted to the Pakistan Stock Exchange (PSX) on Thursday, the company posted a profit after tax of Rs3.80 billion during the second quarter of 2026, compared with Rs5.57 billion in the corresponding quarter of 2025.
Earnings per share (EPS) declined to Rs2.85, down from Rs4.17 a year earlier, reflecting the drop in quarterly profitability.
Board approves Rs1.75 interim dividend
The board of directors, at its meeting held on July 29, 2026, approved an interim cash dividend of Rs1.75 per share for the quarter ended June 30, 2026.
The latest payout is in addition to the Rs2.00 per share interim dividend already distributed earlier this year, continuing the company’s policy of rewarding shareholders despite lower earnings.
First-half profit drops 16%
For the six months ended June 30, 2026, Engro Fertilizers reported a profit after tax of Rs7.12 billion, representing a 16% decline from Rs8.45 billion recorded during the corresponding period of 2025.
The decline in earnings was primarily driven by lower sales during the first half of the year.
Revenue and gross profit decline
Net sales fell to Rs70.85 billion during January–June 2026 from Rs80.69 billion in the same period last year.
As a result, gross profit declined to Rs23.56 billion, compared with Rs26.53 billion in the corresponding period of 2025.
The figures indicate that subdued sales continued to pressure margins despite efforts to manage operating costs.
Cost control cushions earnings
Engro Fertilizers reduced its operating and administrative expenses during the first half of the year, helping to partially offset the impact of lower revenue.
Administrative expenses declined to Rs2.53 billion from Rs3.00 billion a year earlier, while operating expenses decreased to Rs1.08 billion, compared with Rs1.70 billion in the corresponding period of 2025.
The company also reported lower income tax payments, which fell to Rs5.00 billion during the first half of 2026 from Rs5.68 billion in the same period last year.
Despite the weaker financial performance, Engro Fertilizers maintained shareholder returns through its interim cash dividend, while its cost management measures helped mitigate the impact of declining sales on overall profitability.