Karachi: Maple Leaf Cement Factory Ltd. (MLCF) has reported a decline in its first-quarter earnings for FY25, with consolidated earnings falling to PKR 1.3 billion, down from PKR 1.6 billion in the same period last year, a decrease of 17% year-over-year. The downturn was attributed primarily to a significant drop in cement offtakes.

According to AKD Securities Limited, the revenue for MLCF decreased by 6% year-over-year to PKR 15.7 billion, largely due to a 20% decline in cement offtakes, which totaled 0.85 million tons compared to 1.1 million tons in the same period last year. Despite the lower volume, higher retention prices helped mitigate the impact on revenue.

The company’s gross margins remained stable at 31.6%, nearly unchanged from 31.3% in the same period last year. This stability was supported by higher retention prices and a reduction in grid tariffs, which balanced out the rise in royalty rates. However, distribution expenses increased by 17% year-over-year to PKR 1.3 billion, driven by a 39% increase in export volumes. Administrative expenses also rose by 44% due to inflationary pressures.

Finance costs for MLCF decreased by 29% year-over-year to PKR 675 million, reflecting a 20% reduction in total borrowing and declining financing rates. Despite the challenges, AKD Securities maintains a ‘Buy’ stance on MLCF with a target price of PKR 56 per share by June 2025, suggesting a potential upside of 44%.