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Karachi: Roshan Packages Ltd reported a slight increase in revenues, reaching PkR10.3 billion for the fiscal year 2024, marking a 0.85% year-over-year growth. However, the company experienced a substantial rise in net profit after tax (NPAT), which surged by 41% to PkR211 million, translating to an earnings per share (EPS) of PkR1.49.
According to AKD Securities Limited, the significant increase in NPAT was primarily driven by a rise in other income, notably an 85% increase to PkR271 million, largely attributed to interest income from its wholly-owned subsidiary, Roshan Sun Tao Paper Mills Ltd. Despite this financial growth, the company faced a decline in production from its corrugated and flexible facilities by 15% and 0.8%, respectively, in FY24 compared to the previous year.
The company’s production capacity for corrugated and flexible packaging is 60,000 and 12,240 tons annually. However, gross margins experienced compression during FY24, decreasing from 9.9% in FY23 to 8.6% in FY24 due to rising raw material and input costs.
In a move towards sustainability, Roshan Packages Ltd has transitioned its corrugation plant to solar energy, reducing carbon emissions by approximately 0.85 kg of CO2 per kWh of solar electricity generated. Further solar installations are underway at its flexible packaging facility.
The total power consumption for corrugated and flexible packaging stands at 2.0 MW and 1.5 MW, respectively. The corrugated packaging market in Pakistan is estimated at 1.50 million tons, with Roshan Packages Ltd holding a 7-8% market share within the sector.
Roshan Suntao Paper Mill Pvt. Ltd, currently under construction, will require 5-6 MW of power and is projected to have an annual capacity of 100,000 tons. This capacity will supply raw materials for the corrugated division and benefit from a 10-year tax holiday.
Management advocates for the formal recognition of packaging as an industry, which they argue is essential to regulate the sector, provide accurate statistics, and address market demands effectively. The company remains optimistic that improving economic activity and discussions on formally recognizing packaging as a sector will serve as positive catalysts for future growth.
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