Engro Fertilizers Limited (PSX: EFERT) has announced its financial results for the nine months ending September 30, 2025, posting a notable decline in profitability as lower revenues and rising finance costs weighed on earnings. The company recorded a profit after tax of Rs 14.3 billion, down 20.6 percent from Rs 18 billion in the same period of the previous year.
Earnings per share for the period decreased to Rs 10.69 compared to Rs 13.47 in 9MFY24. The company also declared a cash dividend of Rs 4.5 per share, reflecting its continued commitment to shareholder returns despite a challenging business environment.
Engro Fertilizers’ net sales for the nine-month period fell 21.2 percent year-on-year to Rs 135.5 billion, compared to Rs 171.8 billion a year earlier. This decline was primarily driven by lower revenue generation during the period. Cost of sales also declined significantly, falling 27.8 percent to Rs 91.1 billion from Rs 126.1 billion in the same period of FY24.
Despite the revenue decline, the company managed to maintain a relatively stable gross profit, which contracted only 3 percent to Rs 44.4 billion from Rs 45.7 billion in 9MFY24. This was largely supported by an improvement in gross margins, which rose to 32.8 percent from 26.6 percent last year. The improvement indicates effective cost management and operational efficiencies despite reduced sales volumes.
On the expense front, selling and distribution costs increased by 7.1 percent to Rs 11.9 billion, while administrative expenses rose marginally by 0.7 percent to Rs 3.7 billion. Other income declined sharply by 34.6 percent to Rs 1.6 billion from Rs 2.4 billion, while other operating expenses remained stable, registering a slight decrease of 0.8 percent to Rs 2.6 billion.
Engro Fertilizers reported a profit before taxation of Rs 23.7 billion for the nine-month period, down 17.3 percent from Rs 28.7 billion in 9MFY24. Finance costs saw a substantial increase of 54.8 percent, rising to Rs 4.1 billion compared to Rs 2.7 billion last year, reflecting higher borrowing costs and interest rate pressures.
The company also reported a reduced gain on subsidy receivable from the Government of Pakistan. This gain amounted to Rs 194.7 million in 9MFY25, significantly lower than the Rs 698 million recorded during the same period last year, representing a 72.2 percent decline. Taxation decreased 11.8 percent to Rs 9.4 billion from Rs 10.7 billion in the prior year, partially offsetting the impact of reduced profitability.
As a result, Engro Fertilizers concluded 9MFY25 with a net profit of Rs 14.3 billion. The company recorded a net profit margin of 10.5 percent, compared to the same level last year, indicating pressure on bottom-line earnings despite improved cost controls.
Industry analysts note that while improved gross margins suggest efficient operations, the impact of declining revenues and rising finance costs will likely influence short-term profitability. The fertilizer sector remains sensitive to input cost fluctuations, regulatory developments, and subsidy-related challenges, which continue to shape earnings performance.
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