Lahore: Suraj Cotton Mills Limited has reported its financial results for the first quarter ending September 30, 2026, showcasing a robust net profit increase despite a downturn in sales. The company announced a net profit of Rs. 451 million, marking a 13.76 percent increase from the Rs. 396 million recorded in the same period last year.

The company's earnings per share rose to Rs. 9.24 from Rs. 8.12, indicating sustained financial resilience. The gross profit saw substantial growth, increasing by 33.5 percent to Rs. 652 million from Rs. 488 million. The gross margin improved to 11.5 percent from 7.5 percent, attributed to reduced raw material and energy costs.

However, sales for the quarter fell to Rs. 5.68 billion, a decline of 12.5 percent from Rs. 6.49 billion in the previous year. Export sales also decreased to Rs. 251 million from Rs. 372 million, reflecting a challenging international market. Finished goods inventory rose to Rs. 2.95 billion from Rs. 2.66 billion as of June 30, 2026.

According to information available from the Pakistan Stock Exchange (PSX), the decrease in sales represents a significant move. Despite the decrease in sales, the company's operating profit increased slightly by 1.5 percent to Rs. 617 million, while finance costs were reduced by 12.5 percent due to decreased short-term borrowings.

The company incurred capital expenditures of Rs. 1.87 billion during the quarter, primarily for new plant and machinery, supported by long-term financing of Rs. 1.80 billion. Shareholders' equity increased modestly to Rs. 15.94 billion from Rs. 15.58 billion in June 2026.

In summary, while Suraj Cotton Mills Limited faced a drop in sales, the company demonstrated strong profitability and controlled financial metrics, underscoring its capability to navigate a challenging business landscape.