Lahore: Interloop Limited (ILP) has announced its financial results for the first quarter of fiscal year 2027, reporting consolidated earnings of Rs4.2 billion, translating to an earnings per share (EPS) of Rs3.03. This marks a significant increase of 54% compared to the same period last year and a 14% rise from the previous quarter. According to JS Global, these results exceeded expectations, largely due to higher-than-estimated other income and improved gross margins.

The company reported gross margins of 22.7% for the quarter, a slight decrease from 23.3% in the first quarter of fiscal year 2026, but an improvement from 20.5% in the fourth quarter of fiscal year 2026. The higher-than-expected gross margins were largely attributed to favorable pricing in the apparel segment, as noted during the company’s annual general meeting. However, pricing pressures persisted in the hosiery segment.

Other income for the quarter saw a substantial increase, rising 2.42 times year-on-year to Rs1.7 billion, up from Rs0.7 billion in the same quarter last year. This increase was primarily driven by gains on derivatives totaling Rs1.5 billion, along with export incentives amounting to Rs120 million.

Net sales for the quarter rose by 12% year-on-year to Rs50.7 billion, although this represented a 10% decrease compared to the previous quarter. The effective tax rate dropped to 29.3%, down from 39.2% in the same period last year, mainly due to the removal of the super tax.

Finance costs decreased by 8% year-on-year to Rs1.6 billion, while distribution expenses saw a 25% year-on-year increase, reaching Rs2.0 billion. Administrative expenses grew by 6% year-on-year but declined by 17% on a quarterly basis, amounting to Rs2.9 billion.

Interloop Limited maintains a positive outlook, reiterating its BUY recommendation with a forward price-to-earnings ratio of 6.8x for fiscal year 2027.