Faisalabad: Interloop Limited (ILP) announced its second-quarter fiscal year 2026 earnings today, revealing consolidated profits of Rs3.2 billion, or an earnings per share (EPS) of Rs2.25. This performance marks an increase of 2.8 times year-on-year and 15% quarter-on-quarter, surpassing market expectations. The company's financial performance was bolstered primarily by increased other income and reduced financial charges.
According to JS Global, the company's first-half fiscal year 2026 consolidated profit reached Rs5.9 billion, or an EPS of Rs4.21, representing a fourfold year-on-year increase. Additionally, Interloop Limited declared an interim dividend of Rs2 per share for the second quarter, marking the first such dividend declaration in two years and exceeding expectations.
The company's other income in the second quarter rose by 3.4 times year-on-year and 42% quarter-on-quarter to Rs1 billion. This increase was attributed to the forward booking of export proceeds. Concurrently, finance costs decreased by 38% year-on-year and 2% quarter-on-quarter, attributed to a decline in interest rates.
Net sales for the second quarter saw a modest rise of 1% year-on-year to Rs45 billion, with total first-half fiscal year 2026 net sales reaching Rs90.4 billion, a 3% year-on-year increase. Gross margins improved to 23.43% in the second quarter, compared to 20.06% in the same quarter last year, supported by higher sales and improved performance in the apparel segment.
The effective tax rate for the second quarter stood at 42.53%, up from 30.42% in the same period last year. Distribution expenses decreased by 28% year-on-year to Rs1.3 billion, while administrative expenses rose by 6% year-on-year to Rs2.8 billion. Other expenses fell by 24% year-on-year to Rs265 million.
JS Global maintains its "buy" recommendation for Interloop Limited, with fiscal year 2026 and 2027 projected price-to-earnings ratios of 11.4 and 6.9 times, respectively.
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