Karachi: Lucky Cement (LUCK) has announced its financial results for the first quarter of the fiscal year 2026, reporting a 23% year-over-year increase in earnings per share (EPS) to Rs15.0. This rise aligns with market expectations.

The company's consolidated earnings for the quarter amounted to Rs21.99 billion, marking a 12% increase from the preceding quarter. Despite the positive earnings report, Lucky Cement did not declare any cash dividend, which was anticipated.

On a consolidated basis, the company's net revenue saw an 11% increase year-over-year and a 6% increase quarter-over-quarter, reaching Rs123.6 billion. This growth is attributed to higher revenue from local cement sales and Lucky Motors, reflecting the broader trend in the automotive industry.

Finance costs for the company decreased by 40% compared to the previous year, primarily due to reduced debt levels and lower interest rates.

Gross margins for Lucky Cement were reported at 25.5% for the quarter, compared to 24.2% in the last quarter and 28.4% in the same quarter last year. The share of profit from associates rose by 27% year-over-year and 11% quarter-over-quarter, totaling Rs5.4 billion.

On a standalone basis, the company's profit increased significantly, with earnings per share rising to Rs9.98, representing a 2.23 times increase year-over-year and a 2.54 times increase quarter-over-quarter. This growth was largely driven by a substantial increase in other income, mainly due to a Rs6 billion dividend received from Lucky Electric Power Company.

The standalone gross margins improved to 39% in the first quarter of fiscal year 2026, up from 33% in the same quarter the previous year and 36% in the previous quarter. This improvement was driven by an 18% increase in domestic cement dispatches, greater reliance on renewable energy sources, and lower coal prices.

The effective tax rate for the company's standalone business was 25%, down from 33% in the same quarter last year. On a consolidated basis, the effective tax rate was 21.3%, compared to 19.7% in the previous year.

The company continues to maintain a "BUY" stance on its stock, which is currently trading at a projected price-to-earnings ratio of 6.9 for fiscal year 2026 and 5.8 for fiscal year 2027.