Karachi: The Board of Directors of Wah Nobel Chemicals Limited has released its unaudited financial statements for the first quarter ending September 30, 2026. Reporting a significant shift in its financial dynamics, the company noted a marked decline in sales but an improvement in profitability.
For the quarter ending September 30, 2026, Wah Nobel Chemicals Limited's gross sales decreased by 3.7% to Rs 1,605 million compared to Rs 1,667 million in the same quarter of the previous year. Net sales also saw a decline of 5.0%, reaching Rs 1,343 million from Rs 1,413 million in the prior year’s corresponding quarter. The company attributes this drop primarily to reduced sales volume, which fell from 9,236 M.Tons to 7,089 M.Tons due to the suspension of exports to Afghanistan following the closure of the Pak-Afghan border. This closure has shifted industry volume into the domestic market, intensifying competitive pressure and reducing selling prices.
Despite the sales decline, the company recorded a 10.9% increase in profit after taxation, reaching Rs 136 million, up from Rs 122 million in the previous year's quarter. The increase is attributed to strategic price adjustments that counteracted the rise in methanol costs, the company’s principal raw material, which fluctuated between US$ 470 and US$ 600 per M.Ton. Consequently, the gross margin expanded to 18.1% of net sales from 17.5%, and the gross profit was maintained at Rs 243 million, a minor move of 2.0% from the previous quarter's Rs 248 million.
According to information available from the Pakistan Stock Exchange (PSX), the company's operating profit also experienced a minor move, decreasing by 2.0% to Rs 226 million from Rs 230 million. However, profit before taxation rose to Rs 215 million, a 7.4% increase, reflecting a moderate move.
The company successfully reduced its finance cost to Rs 0.3 million from Rs 16.3 million, following the repayment of outstanding borrowings by June 30, 2025. The effective tax rate decreased to 37.0% from 39.0% due to a reduction in super tax from 10% to 8% under the Finance Act, 2026.
Wah Nobel Chemicals Limited generated Rs 57 million in net cash from operating activities, which funded Rs 6 million in capital expenditure. Cash and bank balances increased to Rs 154 million from Rs 103 million at year-end. The shareholders' equity rose to Rs 3,154 million, equating to a break-up value of Rs 350.5 per share.
The Board has decided not to recommend any interim cash dividend for the quarter. All transactions with related parties were conducted on an arm's length basis, reviewed by the Audit Committee, and approved by the Board. There were no changes in the contingencies related to fees levied by the Governments of Sindh and Punjab, as disclosed in the financial notes.