Lucky Cement Ltd (LUCK) has announced its financial results for 4QFY26, reporting an unconsolidated net profit after tax (NPAT) of PKR9.9bn (US$35.7m). This marks a notable 72 per cent increase YoYr; however, it reflects a 27 per cent decline compared to the previous quarter, according to data released on the Pakistan Stock Exchange today.
A recent research report from IMS Research attributes the sequential decline primarily to a one-time other income recorded in the prior quarter.
In a strategic move, the company indicated that an additional 15 MW of solar capacity will be operational at its Karachi plant by 1QFY27, bringing the total installed capacity to 89.3 MW. Furthermore, the installation of an Upgrade Technology & Integrated System (UTIS) across all four production lines at the Karachi facility is now complete, enhancing the plant's total cement capacity to 5.35Mta.
LUCK has also announced a year-end cash dividend of PKR 5 per share, slightly below the anticipated PKR 6 per share.
On a consolidated basis, Lucky Cement reported a 4Q NPAT of PKR25.3bn, translating to an earnings per share (EPS) of PKR17.31. This figure signifies a 29 per cent increase year-on-year and a 33 per cent increase quarter-on-quarter, exceeding expectations of PKR15.96 per share due to higher joint venture earnings, which rose 28 per cent quarter-on-quarter, likely driven by a resurgence in sales in Iraq. The company’s facility in Congo continues to show strong performance, with an additional 1.6Mta of capacity increasing total capacity to 2.91Mta, and construction is expected to commence in the first quarter of FY27.
Key highlights from LUCK's 4QFY26 results include:
- Net sales reached PKR35.6bn, reflecting a 7 per cent quarter-on-quarter increase, although slightly below estimates. This growth is attributed to a 5 per cent rise in dispatches.
- Gross margins improved to approximately 38 per cent, up 0.7 percentage points quarter-on-quarter, buoyed by higher retention prices and enhanced export margins.
- Distribution expenses surged by 20 per cent sequentially to PKR2.6bn, driven by an 8 per cent quarter-on-quarter increase in exports.
- Other expenses escalated to PKR1.9bn, marking an 82 per cent increase compared to the previous quarter, with management expected to provide further insights.
- The Board of Directors also recommended a further equity investment of up to PKR1bn in the company’s associated entity, National Resources Limited.
- The effective tax rate fell to 23 per cent, down from 36 per cent in the same period last year, likely influenced by substantial other income, although detailed accounts are awaited for more clarity.
Lucky Cement continues to showcase resilience, backed by a diversified portfolio and a robust balance sheet, positioning itself favorably across market cycles. The ongoing domestic initiatives, including the solar expansion and UTIS-led efficiency improvements, are set to further solidify its leadership in Pakistan's cement industry.
Sales
The company delivered a strong performance in the domestic market, with local sales volumes increasing by 10.1 per cent to 6.5Mt in FY 2026, outperforming the industry's domestic sales growth of 9.3 per cent. This outperformance was primarily driven by the company's increased footprint in new markets. Export volumes declined by 8.2 per cent to 3.1Mt during the year, reflecting the strategic rationalization of geographic exposure in line with prevailing margin dynamics, together with pressure on exports from the northern plant following the closure of the Afghan border. This shift reflects a more balanced sales mix and supports a sustainable volume profile. As a result, total sales volumes of the Company increased by 3.5 per cent in FY 2026 compared to last year.
By Abdul Rab Siddiqi, Pakistan
