Pakistan Tobacco Company Limited delivered a strong start to 2026, posting sharp profit growth despite rising taxes and higher operating costs. The company benefited from solid local demand and better cost control, which helped lift margins during the first quarter.
For the quarter ended March 31, 2026, the company’s consolidated net profit rose 49% to Rs9.34bn, compared to Rs6.27bn in the same period last year. As a result, basic and diluted earnings per share increased to Rs36.57, up from Rs24.53 in Q1 2025. The company also announced a dividend of Rs35 per share.
This growth came mainly from a strong expansion in gross margins. Domestic sales remained the key driver, while production costs stayed under control. Gross turnover climbed 28% year-on-year to Rs102.27bn. Notably, domestic turnover jumped 35% to Rs99.59bn. However, export turnover dropped 57% to Rs2.68bn, though this decline was fully offset by local sales.
At the same time, the company passed on higher government levies. Excise duties rose 29% to Rs48.18bn, while sales tax increased 36% to Rs15.99bn. Even then, net turnover grew 24% to Rs38.10bn, compared to Rs30.65bn last year.
Cost discipline also played a key role. The cost of sales remained almost unchanged, slipping 0.5% to Rs16.70bn. Since revenue grew faster than costs, gross profit surged 54% to Rs21.39bn, up from Rs13.86bn a year earlier.
On the expense side, the trend was different. Selling and distribution costs more than doubled, rising 101% to Rs2.55bn. Administrative expenses increased 31% to Rs1.59bn, while other operating expenses went up 57% to Rs1.26bn. Still, higher other income and strong margins helped absorb these costs. As a result, operating profit rose 52% to Rs16.04bn.
Below the operating level, financial income declined. Finance income fell 45% to Rs156.84m, while finance costs dropped 17% to Rs212.81m. This shift moved the net finance position from an income of Rs26.32m last year to a cost of Rs55.98m in this quarter.
Even so, profit before tax increased 51% to Rs15.99bn. After accounting for a higher tax expense of Rs6.65bn, up 53% year-on-year, the company closed the quarter with a net profit of Rs9.34bn, marking a 49% increase.
Overall, strong domestic demand and stable costs supported the company’s performance. Despite higher taxes and expenses, margins remained strong, which drove profit growth in the first quarter.
STATEMENT OF PROFIT OR LOSS FOR THE THREE MONTHS ENDED MARCH 31, 2026 (Rs.000)
| Description | 2026 | 2025 | Change % |
|---|---|---|---|
| Domestic turnover | 99,587,640 | 73,733,678 | 35% |
| Export turnover | 2,681,230 | 6,188,330 | -57% |
| Gross turnover | 102,268,870 | 79,922,008 | 28% |
| Excise duties | (48,178,482) | (37,478,534) | 29% |
| Sales tax | (15,993,540) | (11,793,369) | 36% |
| Net turnover | 38,096,848 | 30,650,105 | 24% |
| Cost of sales | (16,702,877) | (16,787,309) | -1% |
| Gross profit | 21,393,971 | 13,862,796 | 54% |
| Selling and distribution costs | (2,546,648) | (1,268,439) | 101% |
| Administrative expenses | (1,591,204) | (1,210,455) | 31% |
| Other operating expenses | (1,259,753) | (802,241) | 57% |
| Other income | 48,070 | 1,786 | 2591% |
| Operating expenses subtotal | (5,349,535) | (3,279,349) | 63% |
| Operating profit | 16,044,436 | 10,583,447 | 52% |
| Finance income | 156,835 | 282,736 | -45% |
| Finance cost | (212,814) | (256,417) | -17% |
| Net finance (cost) / income | (55,979) | 26,319 | — |
| Profit before income tax | 15,988,457 | 10,609,766 | 51% |
| Income tax expense – current | (6,497,457) | (4,280,985) | 52% |
| Income tax expense – deferred | (147,646) | (62,640) | 136% |
| Total income tax | (6,645,103) | (4,343,625) | 53% |
| Profit for the period | 9,343,354 | 6,266,141 | 49% |
| Earnings per share (basic & diluted) | 36.57 | 24.53 | 49% |
