Pioneer Cement Limited (PIOC) has posted a profit of Rs 1.6 billion down 9 percent year on year basis in its 2QFY26 results on Wednesday.
The company posted net earnings of Rs1.6bn (EPS Rs7.04) compared to Rs1.75bn (EPS Rs7.7) during the same period last year, down 9% YoY.
The result came above our estimate, mainly due to higher-than-expected gross margins.
Read More: Cement Profits May Decline in 2QFY26
During 2QFY26, PIOC’s topline clocked in at Rs10.2bn (up 15% YoY). Despite a decrease in retention prices (down 7% YoY), the increase was mainly due to a 26% YoY rise in volumetric sales.
PIOC’s gross margin clocked in at 30% compared to 42% during the same period last year. We believe the sharp decline in margins was due to higher coal costs, as the company relied on expensive local coal rather than cheaper Afghan coal,” Sherman analysts said.
Interestingly, despite higher revenue, operating expenses decreased by 44% YoY. We believe this may be due to enhanced operational efficiency.
Finance costs reduced by 49% to Rs179mn, mainly due to lower financing rates and reduced borrowings, as the company is focused on deleveraging.
On a sequential basis, earnings increased sharply by 26% QoQ, mainly due to elevated volumetric sales (up 24% QoQ).
On a cumulative basis, in 1HFY26 the company posted net earnings of Rs2.8bn (EPS Rs12.7) compared to Rs2.7bn (EPS Rs12.2), up 4% YoY. The growth in earnings was primarily driven by an 11% YoY increase in revenue to Rs18.6bn, despite margins contracting to 30% (down 6ppt YoY). Earnings were further supported by a 53% YoY decline in finance costs to Rs393mn in 1HFY26.
