⏸️ QUICE: HOLD Signal (6/10) – Transmission of Annual report for the year ended June 30, 2025

📌 Key Takeaways

• 🚀 Highest Ever Turnover: Achieved PKR 1.094 billion in sales, marking a 21.20% YoY increase.
• 💰 Loss Reduction: Loss after taxation significantly reduced by 57% to PKR 11.730 million.
• 📈 Local Sales Growth: Local sales surged by 74%, demonstrating strong domestic demand.
• ⚖️ Tax Burden: Company faced a combined 38% tax burden on packaged fruit juices.
• 📉 Cost to Sales Ratio: Decreased slightly from 86.05% to 82.92% in the current year.
• 🏭 Gross Profit Improvement: Gross profit stood at PKR 187.00 million, up from PKR 125.98 million.
• ⚠️ Cost Pressures: Raw material, utility, and freight costs continue to challenge margins.
• ⬆️ Depreciation Increase: Depreciation charge increased by 26% due to expansion projects.
• 📉 Loss Per Share Improvement: Loss per share improved to Re. (0.12) compared to Re. (0.28) last year.
• 🌍 Export Slowdown: Sea export demand slowed due to conflicts and high costs.
• 🌱 Environmental Initiatives: Increased tree plantation efforts to reduce CO2 emissions.
• 🚺 Gender Pay Gap: SECP disclosure of 28% (Mean) and 33% (Median) Gender Pay Gap.
• ⚠️ Cautious Outlook: Expect lower domestic demand due to economic challenges and climate impacts.
• 🏦 Dividend Omission: No dividend was recommended considering operational and financial position.
• 👩‍💼 Board Composition: Includes two independent female directors, promoting gender diversity.

🎯 Investment Thesis

Quice Food Industries presents a HOLD recommendation. It is growing revenue and cutting costs which is positive. However, it faces significant headwinds including rising prices, conflict affecting exports, and climate disasters, as well as significant gender wage gap risk which impacts its ESG profile. This impacts our confidence in its upside. Furthermore, without profits, valuation analysis is difficult. We need to see more profits before moving to BUY.