Lahore: Pioneer Cement Ltd (PIOC) has reported a significant increase in its earnings for the fiscal year 2026, with a 35% year-over-year growth attributed to increased dispatches and favorable financial conditions, according to a corporate briefing held by the company. The briefing detailed the results and future outlook, highlighting a strategic merger and planned expansions in renewable energy infrastructure.

According to JS Global, PIOC's parent company, MLCF, has approved the merger of PIOC's remaining minority stake with a swap ratio of 2.65 MLCF shares for every PIOC share. This merger is expected to align PIOC's share price with MLCF's, providing a stable valuation framework. Additionally, the company is advancing its renewable energy efforts with the installation of a 28.265MW solar power plant, expected to be completed by December 2026 at a cost of Rs2 billion, with a projected payback period of 1.5 years.

The company is also assessing the implementation of a 25MW Battery Energy Storage System (BESS) to stabilize electricity supply, with an estimated capital expenditure ranging from Rs1.5 to Rs1.67 billion. This initiative comes in response to supply disruptions of local Darra coal and fluctuating power rates. PIOC has started incorporating imported coal into its energy mix, which now constitutes 5% of its total coal consumption, as local coal prices have surged to approximately Rs63,000 per ton.

PIOC's reliance on its coal-fired power plant has decreased due to rising coal costs, making the plant uneconomical. The company now sources 67% of its power from the grid and 33% from waste heat recovery, with its average power cost at Rs22 per kWh for FY26. Despite challenges, the company remains optimistic about domestic cement demand, forecasting a 7.5% growth for FY27, driven by initiatives like the Apna Ghar scheme. The ongoing royalty case remains a point of uncertainty for the company.