FFL

⚡ Flash Summary

Fauji Foods Limited (FFL) reported its Q3 2025 financial results, showcasing strong growth and profitability. The company achieved its highest-ever PAT of PKR 945 million, a significant 68.8% increase over the same period last year (SPLY). Revenue also reached a record PKR 21.0 billion, reflecting a 19.1% growth compared to SPLY. This performance is driven by margin accretive growth with absolute Gross Margins grew by 18% vs SPLY.

📌 Key Takeaways

• 🎉 Highest Ever PAT: Achieved a record Profit After Tax (PAT) of PKR 945 million in YTD Q3 2025, up by 68.8% compared to SPLY.
• 🚀 Revenue Growth: YTD Q3 2025 recorded the company’s highest 9 months revenue of PKR 21.0 bn, marking a 19.1% increase over SPLY.
• 🥛 UHT Milk Performance: UHT milk continues its growth momentum with a value growth of 13.2% over SPLY.
• 📈 Margin Improvement: Absolute Gross Margins improved by 18% compared to SPLY.
• 💪 Operating Profit: Operating profit for YTD Q3 2025 reached PKR 1.17 billion, an increase of 20% compared to SPLY.
• 📊 Revenue Breakdown: Revenue increased from PKR 17.594 billion in 2024 to PKR 20.961 billion in 2025 (YTD Q3).
• 💸 PAT Growth: PAT increased from PKR 560 million in 2024 to PKR 945 million in 2025 (YTD Q3).
• 🌱 Broad Portfolio: Inclusion of Cereals and Pasta is expected to further drive growth in both topline and bottom-line.
• 🎯 Strategic Focus: The business is focused on delivering margin accretive growth, reflected in key metrics across the P&L.
• 💼 No Dividend: No cash dividend, bonus shares, or right shares were recommended by the Board of Directors.
• 🏦 Strong Asset Base: Total assets stood at PKR 20.67 billion as of September 30, 2025, compared to PKR 18.65 billion as of December 31, 2024.
• 💰 Cash Position: Cash and cash equivalents amounted to PKR 5.66 billion.
• 📉 Accumulated Loss: Accumulated losses decreased from PKR 16.89 billion in December 2024 to PKR 15.85 billion in September 2025.

🎯 Investment Thesis

BUY. Fauji Foods is exhibiting strong growth and improved profitability. The company’s strategic focus on margin improvement and portfolio diversification positions it well for future growth. With the decreasing accumulated losses and increasing PAT, the company is likely to offer good returns to investors. A price target of PKR 50 is set, based on projected earnings growth and sector multiples, with a medium-term horizon.

⚡ Flash Summary

Fauji Foods Limited (FFL) has reported its financial results for the nine-month period ended September 30, 2025. The company achieved its highest-ever profit after tax (PAT) of PKR 945 million, a significant 68.8% increase compared to the same period last year. Revenue reached an all-time high of PKR 21.0 billion, driven by effective growth strategies and sustained brand strength. The company also reported an 18% absolute gross margin improvement, reflecting higher operational efficiency and disciplined cost management. This performance underscores FFL’s focus on margin-accretive growth and long-term commercial sustainability.

📌 Key Takeaways

• 💰 Highest-ever profit after tax (PAT) of PKR 945 million, up 68.8% year-over-year.
• 🚀 Revenue reached an all-time high of PKR 21.0 billion.
• 📈 Net revenue grew by 19.1% compared to the same period last year (SPLY).
• 🥛 UHT Milk sales grew by 13.2% year-over-year.
• 💪 Absolute gross margin improved by 18% compared to SPLY.
• ⚡ Operating profit rose to PKR 1.17 billion, a 20.2% increase year-on-year.
• 🌱 Focus on margin-accretive growth and long-term commercial sustainability.
• 🤝 Positive diplomatic developments with Saudi Arabia leading to macroeconomic stabilization.
• 🇵🇰 Appreciation of the Pakistani Rupee contributing to economic outlook.
• ⬇️ Easing inflation and downward trend in interest rates providing economic relief.
• ☀️ Utilization of 1 MW Solar and Biomass energy contributing to energy cost savings.
• 📊 Threefold increase in employee engagement scores.
• 🍝 Focus on the Cereals segment and Pasta business to further enhance margins and portfolio strength.
• 🌱 Commitment to margin-led growth, cost optimization, and organizational excellence.

🎯 Investment Thesis

Given the strong financial performance, particularly the substantial increase in profit and revenue, a BUY recommendation appears justified. The company’s focus on margin accretive growth and long-term sustainability, combined with positive macroeconomic indicators, suggests continued growth. This assumes that risks are mitigated and macroeconomic stability persists. The strong earnings support a higher valuation.