Karachi: Shahzad Textile Mills Limited has reported a pre-tax loss of Rs. 5.27 million for the first quarter ending September 30, 2024, a decline from the pre-tax profit of Rs. 28.62 million achieved in the same quarter last year. The company's sales for the current quarter stood at Rs. 2.23 billion, showing a reduction compared to Rs. 2.68 billion during the corresponding period last year, according to the company's Directors' Report.

According to information available from the Pakistan Stock Exchange (PSX), the company attributes this performance shift to high interest rates, inflation, and increased energy costs, which have impacted multiple textile units across Pakistan. Management of Shahzad Textile Mills noted that these economic factors, along with a reduction in market demand, have placed pressure on the spinning segment, resulting in narrowed margins for yarn products. However, the company’s socks unit has demonstrated export growth compared to the same period in the prior year.

The Board of Directors expressed optimism for the sector's future, contingent on government intervention regarding critical economic issues, including interest rate reductions, a competitive energy tariff, and currency stabilization, which the industry sees as essential for export growth. While the government has initiated some measures to address interest rates, action on energy costs remains outstanding. As part of a strategic approach to manage financial pressures, Shahzad Textile Mills’ board has opted to revise existing loans to interest-free terms, effective July 1, 2024.

Loss per share for the first quarter was recorded at Rs. (1.60), in contrast to Rs. 0.11 for the same period last year. Management expressed appreciation for shareholder and customer support and emphasized confidence in the company’s resilience and its team’s ability to navigate present challenges.