Mughal Iron and Steel Industries Limited reported a 158% year-on-year increase in profit for fiscal year 2026, with earnings reaching Rs. 2.487 billion compared with Rs. 966 million in the previous year.
According to a result review by Arif Habib Limited, the company’s earnings per share (EPS) increased to Rs. 7.41 in FY26 from Rs. 2.88 a year earlier.
Mughal Steel also announced a cash dividend of Rs. 2 per share, marking the company’s first dividend after a two-year gap. The dividend represents a payout ratio of 27%.
Despite the strong annual performance, the company’s earnings per share for the fourth quarter of FY26 declined by 29% year-on-year to Rs. 1.08.
The company’s annual revenue decreased by 13% year-on-year to Rs. 77.958 billion, while the cost of sales fell by 15% to Rs. 69.302 billion. The larger decline in costs helped Mughal Steel improve its gross margin to 11% from 9% in the previous year.
The improvement in gross margins was supported by a 5% year-on-year decline in electricity tariffs and stable capacity utilization. However, international scrap prices increased by 3%, while rebar prices declined by 1%, reducing the scrap-to-rebar spread by 15%.
Mughal Steel’s other income increased 2.7 times year-on-year to Rs. 549 million, mainly due to markup income on a loan provided to a subsidiary at three-month KIBOR plus 2.25%.
Meanwhile, finance costs declined by 33% to Rs. 3.821 billion, compared with Rs. 5.723 billion in FY25. The decline was primarily attributed to lower borrowing costs during the year.
The company’s total debt increased by 36% year-on-year to Rs. 38.066 billion in the fourth quarter of FY26, while debt also increased 16% compared with the previous quarter.
Cash and cash equivalents, however, rose to Rs. 7.692 billion, compared with Rs. 3.331 billion in FY25 and Rs. 3.623 billion in the third quarter of FY26.
Mughal Steel’s effective tax rate increased to 31% in FY26, compared with 29% in the previous year.
Overall, the company’s FY26 profit growth was supported by improved margins, lower finance costs and higher other income despite a decline in annual revenue.
