Interloop defies textile sector downturn

Posts profit of Rs20.17b, growth of 63% in one year

LAHORE:

Amidst the challenges faced by Pakistan’s textile sector, which has been grappling with a negative trend, certain companies are proving to be exceptions by consistently posting annual profits, shedding light on the need for innovation and technology infusion across the textile value chain.

In a recent disclosure to the Pakistan Stock Exchange, Interloop Limited proudly announced a profit of Rs20.17 billion for the fiscal year 2023, concluding on June 30 this year. This achievement marks a substantial surge from the company’s profit of Rs12.36 billion in the previous fiscal year, representing a remarkable 63% growth within a single year.

The company, renowned as one of Pakistan’s major textile exporters, also reported a noteworthy increase in net sales, which soared by approximately 31% to Rs119.2 billion during FY23 compared to Rs90.89 billion in FY22. Despite the surge in sales, the cost of goods sold remained at Rs79.3 billion in FY23, slightly up from Rs64.83 billion in FY22, resulting in a robust gross profit growth of 53% to reach Rs39.87 billion in FY23.

Read Textile exports plunge 15%

In a climate where the cost of doing business has escalated significantly in recent years, Interloop Limited’s operating expenses also witnessed an increase, totalling Rs12.92 billion, marking a 26% rise in FY23.

The company announced a final cash dividend of Rs2 per share, supplementing the interim cash dividend of Rs3 per share paid earlier for the year ending June 30, 2023.

Interloop Limited specialises in hosiery, denim, knitwear, activewear, and yarns, boasting an annual turnover of $476 million.

Speaking to The Express Tribune, Textile Analyst at Arif Habib Limited, Muhammad Abrar Polani, said “Interloop’s net sales increased by 39% year-over-year thanks to an increase in exports. The company benefited from currency depreciation, which made its products more affordable in the international market.”

Pakistan’s overall textile exports for FY 2022-2023 amounted to $16.63 billion, reflecting a 10% decline compared to $18.44 billion in the corresponding period.

Published in The Express Tribune, September 8^th, 2023.

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