Karachi: Artistic Denim Mills has disclosed a significant decline in its sales for the financial year ending June 30, 2026, as highlighted in its annual report released on October 7, 2026. The company recorded net sales totaling Rs. 13.895 billion, a decrease from Rs. 18.350 billion in the previous year. This reduction in sales is largely attributed to subdued economic conditions and persistent pricing pressures in export markets. Additionally, a stable exchange rate environment and the temporary loss of a key customer further contributed to the decline.
Despite these challenges, the company managed to increase its gross profit to Rs. 1,125.234 million, up from Rs. 1,061.698 million the previous year, indicating an improvement in gross margin. However, profitability was hindered by elevated production costs, including an increase in gas tariffs and a 10% rise in minimum wages. Finance costs also rose to Rs. 821.141 million from Rs. 706.792 million, driven by increased short-term borrowings due to capital expenditures in prior years.
According to information available from the Pakistan Stock Exchange (PSX), Artistic Denim Mills reported a net loss after tax of Rs. 435.787 million for the year, a slight improvement from the Rs. 451.099 million loss recorded in the preceding year. This resulted in a loss per share of Rs. 5.19, compared to Rs. 5.37 the previous year. The company's working capital requirements were further strained by delays in sales tax refunds and advance income taxes, necessitating additional external financing.
The global economic landscape during this period was marked by resilience amidst geopolitical and trade uncertainties. As per the International Monetary Fund, global growth was projected at 3.0% in 2026, down from 3.4% in 2025. Inflationary pressures eased slightly, although energy and commodity-price volatility continued to pose risks. Advanced economies experienced moderate growth, while emerging and developing economies drove global expansion.
In Pakistan, the economy saw a recovery and stabilization with a real GDP growth of 3.70% in the financial year 2026. The fiscal deficit narrowed, foreign exchange reserves increased, and the Pakistan Stock Exchange delivered strong returns. Nevertheless, structural challenges persisted, with exports under pressure and inflationary pressures re-emerging towards the end of the year.
Despite the setbacks faced by Artistic Denim Mills, the resumption of business with a key customer is expected to support the recovery of sales and production volumes in the current financial year.