Systems Limited Reports 59% Surge in Earnings Amid Improved Margins

Karachi: Systems Limited, a prominent player in the information technology sector, reported a significant 59% increase in its first-quarter earnings for calendar year 2025. The company announced a profit after tax of PkR2.5 billion, or earnings per share of PkR8.5, compared to PkR1.6 billion, or PkR5.4 per share, during the same period last year.

The company’s revenue for the quarter rose to PkR18.1 billion, marking a 19% year-over-year increase. This growth was largely driven by robust performances in the Middle East and North Africa (MENA), North America, and Europe, which saw revenue gains of 17.4%, 13.8%, and 18.9%, respectively.

Systems Limited’s gross margins improved to 25.2%, up from 23.7% in the same quarter last year. The increase was attributed to better margins in the European and MENA markets, which rose to 39.2% and 26.3%, respectively. The company also saw a recovery in the local market, where margins increased to 6.7% from a negative 4.2% in the previous quarter.

Finance costs saw a notable decline, dropping to PkR90 million from PkR148 million, reflecting a 39.6% decrease year-over-year. This reduction was primarily due to lower borrowings and reduced interest rates.

The company’s effective tax rate for the quarter was 7.5%, down from 10.7% in the same period last year.

AKD Securities Limited maintains a ‘BUY’ recommendation for Systems Limited, citing factors such as increasing IT exports, improving gross margins, and a strong presence in the Middle East and Africa region, which are expected to drive future growth. The target price for December 2025 is set at PkR879 per share.