AHCML Research reviewed the 3QFY25 financial results of 15 listed cement companies in the Pakistan Stock Exchange (PSX). They reflected strong profitability growth driven by higher dispatches, increased other income, improved margins, and lower finance costs. The sector reported a cumulative PAT of PKR38.785bn (US$13.7m), up 105 per cent YoY and 13 per cent QoQ.
Net sales reached PKR167.794bn, reflecting a six per cent YoY increase, primarily driven by higher retention prices, two per cent YoY growth in local dispatches, and a 19 per cent surge in export dispatches. Coal prices averaged US$95.56/t during 3QFY25, a marginal 0.94 per cent YoY decline from US$96.46/t in 3QFY24 and a significant 15.57 per cent QoQ decrease from US$110.44/t in 2QFY25.
Other income rose 249 per cent YoY in the 3QFY25 and 113 per cent YoY in the 9MFY25, primarily driven by higher dividend income, increased returns from short-term investments, and larger cash balances.
The average discount rate during the quarter stood at 12 per cent, down from 22 per cent in the 3QFY24 and 15 per cent in the 2QFY25. This marked a sharp decline of 10 per cent YoY and three per cent QoQ. Consequently, finance costs declined by 38 per cent YoY in the 3QFY25 and 47 per cent in the 9MFY25, further supported by a reduction in long-term and short-term borrowings from financial institutions.
Local dispatches reached 9.339Mt in the 3QFY25, up two per cent year over year from 9.174Mt in the 3QFY24; similarly, they declined six per cent quarter over quarter.
Export dispatches rose 19 per cent year over year to 1.722Mt, compared to 1.44Mt in the same period last year, while posting a decline of 35 per cent quarter over quarter.
Outlook
Strong profitability for the cement sector in the 3QFY25, driven by higher dispatches, improved local demand, lower inflation, lower interest rates, and the government’s new construction policy.
By Abdul Rab Siddiqi, Pakistan
