Maple Leaf Cement Sees Strong Earnings Boost Amid Price Hikes and Tax Relief

Lahore: Maple Leaf Cement Factory Ltd. (MLCF) reported a significant increase in its earnings for the third quarter of fiscal year 2025, driven by higher cement prices and a reduction in taxation. The company announced consolidated earnings of PKR 2.8 billion, reflecting an 86% year-over-year growth compared to PKR 1.5 billion in the same period last year. The earnings per share rose to PKR 2.67 from PKR 1.44.

The financial performance surpassed expectations, largely due to higher-than-anticipated revenue figures coupled with a lower tax charge. Revenue for the quarter reached PKR 16.6 billion, marking a 4% increase from PKR 16.0 billion in the prior year. This growth was supported by a 5% rise in company offtakes, with sales of the product ‘hdPutty’ playing a notable role.

Gross margins showed an improvement, increasing by 5.6 percentage points year-over-year to 35.5%. This was attributed to elevated cement prices and decreased coal costs. Meanwhile, distribution and selling expenses saw a substantial reduction of 41% to PKR 770 million, down from PKR 1.3 billion, likely due to cuts in branding and promotional spending.

Other income declined by 51% to PKR 127 million, which was largely due to lower prevailing interest rates. Additionally, the finance cost was reduced by 44% to PKR 464 million, influenced by a decline in borrowing rates and a 6% reduction in total outstanding debt.

The company’s taxation was recorded at PKR 940 million, resulting in an effective tax rate of 25% for the quarter, down from 35% in the same period last year. Cumulatively, the earnings for the nine months of FY25 increased by 46% year-over-year to PKR 7.9 billion, compared to PKR 5.4 billion in the corresponding period of the previous year.

In light of the 77% rally in the stock price during the financial year to date, the company’s outlook has been revised to ‘Neutral’. The target price for December 2025 remains at PKR 71 per share, indicating a potential upside of 5%.