Karachi: Gul Ahmed Textile Mills has released its financial and operational results for the quarter ended September 30, 2024, showcasing a performance marked by robust sales growth despite persistent global and domestic economic challenges.

The company reported a considerable 18% increase in net sales, amounting to Rs 42.08 million, up from Rs 35.64 million in the same period last year. Despite this, the cost of sales rose by 22%, leading to a gross profit of Rs 3.57 million, which is an 11% decline compared to the previous year's Rs 3.99 million.

According to information available from the Pakistan Stock Exchange (PSX), Gul Ahmed faced substantial increases in operational costs, particularly in fuel and power expenses, which surged by 59% to Rs 3.7 billion. The sharp rise in energy costs significantly impacted the company’s profitability, reflected in the 40% decrease in both profit before taxation and profit after taxation.

In response to rising energy costs, the company has made strides in sustainability initiatives, notably launching a 2 MW rooftop solar power project with an additional 17 MW system set to be operational by March FY2025. This move is part of a broader effort to reduce dependency on traditional energy sources.

Globally, the textile sector is experiencing shifts due to changes in commodity prices and geopolitical tensions, particularly affecting trade routes and energy prices. However, Gul Ahmed’s export sales in USD terms showed a promising increase of 30% compared to the same period last year, highlighting its strong market position and strategic responses to external pressures.

The Pakistani economy has shown signs of improvement, with the Consumer Price Index (CPI) falling to 6.9% in September 2024, a significant decrease from 31.4% in the same month the previous year. This deflationary trend coupled with a reduction in the policy rate by 200 basis points to 17.5% reflects improved conditions for business operations and consumer spending.

Looking forward, the company remains cautiously optimistic about the economic landscape for 2025, driven by global economic stabilization, expected increases in digitalization and green technology investments, and a resurgence in international trade. Nonetheless, the potential rise in gas prices and ongoing political instability are concerns that might influence future operational strategies and economic outcomes.