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AN Textile Mills FY2026: Revenue Rose, but Losses Widened as Margins Stayed Razor-Thin

ANTM’s FY2026 sales edged higher, but thinner gross margins, rising overhead and financing burdens widened the annual loss.

Oct 14, 2026ANTMShare price, results & dividends

Verdict

AN Textile Mills Limited (ANTM) ended FY2026 with almost flat sales but weaker unit economics and a wider loss. Revenue for the year ended 30 June 2026 rose 1.1% to PKR 4.542 billion, yet gross profit fell 15.5% to PKR 44.223 million because cost of sales grew faster than revenue. That left a gross margin of only 0.97%, down from 1.17% in FY2025. Distribution and administrative costs then rose sharply, finance cost remained heavy, and the company reported a PKR 115.047 million loss after tax, 11.7% worse year on year.

The result is not a collapse in turnover; it is a failure to convert turnover into an adequate operating spread. ANTM sold slightly more, but every PKR 100 of revenue produced less than PKR 1 of gross profit. With that thin cushion, higher overhead and financing charges were enough to deepen the loss. The year did include two signs of balance-sheet relief—positive operating cash flow and lower reported debt—but liquidity remains tight and no dividend was declared.

Results at a glance

  • Reporting basis: audited annual results for the year ended 30 June 2026; figures are in Pakistani rupees and comparisons are against FY2025.
  • Revenue: PKR 4.542 billion, up 1.1% from PKR 4.492 billion.
  • Gross profit: PKR 44.223 million, down 15.5% from PKR 52.360 million; gross margin fell to 0.97% from 1.17%.
  • Loss from operations: PKR 43.169 million, versus PKR 16.410 million in FY2025.
  • Finance cost: PKR 50.142 million, up 1.1% from PKR 49.582 million.
  • Loss before taxation: PKR 150.082 million, compared with PKR 122.147 million.
  • Loss after tax: PKR 115.047 million, 11.7% wider than PKR 103.007 million; loss per share was PKR 11.91 versus PKR 10.66.
  • Payout: no cash dividend, bonus shares or rights issue was recommended.

What improved

Sales held up. Revenue increased by PKR 49.263 million, or 1.1%, after a much stronger rebound in FY2025. That matters because ANTM did not lose scale in an industry where demand and margins have been uneven. The wider Pakistan textile complex was mixed rather than uniformly weak: the Pakistan Economic Survey reported only 0.7% textile production growth in July–March FY2026, while government data showed textile exports rising in the first half, led by value-added categories. ANTM’s spinning-oriented economics therefore should not be inferred from stronger knitwear or garment exports.

Cash generation also improved at the full-year level. The annual filing reports PKR 96.62 million of cash generated from operations, compared with an operating cash outflow of PKR 121.64 million in FY2025. This is an important improvement, but it should not be confused with accounting profitability: the company still posted a net loss, and the positive cash flow partly reflects working-capital movements that can reverse.

Year-end working capital released cash. Stock-in-trade fell to about PKR 216.6 million from PKR 378.4 million, while trade receivables declined to roughly PKR 109.7 million from PKR 155.7 million. Those reductions help explain why cash flow could improve even as the income statement weakened. Total reported debt also declined to approximately PKR 430.1 million from PKR 675.9 million, reducing balance-sheet leverage at the reporting date.

The earnings bridge

The core operating bridge is straightforward. Revenue increased by PKR 49.3 million, but cost of sales rose by PKR 57.4 million. The extra production cost more than absorbed the additional revenue, cutting gross profit by PKR 8.1 million. The filing does not disclose a clean split between volumes, selling prices, raw-material costs, energy and product mix, so attributing the compression to any one factor would be speculation. What is certain is the arithmetic: cost growth outpaced sales growth and the gross margin narrowed by about 19 basis points.

Below gross profit, distribution cost rose 51.8% to PKR 10.539 million and administrative expenses increased 27.8% to PKR 79.449 million. Combined distribution and administration expenses reached PKR 89.988 million—more than twice the year’s gross profit. Including other reported operating items, the company moved to a PKR 43.169 million operating loss from PKR 16.410 million. The widening was therefore driven mainly by a smaller gross-profit pool and higher overhead, not by finance cost alone.

Finance cost remained a substantial PKR 50.142 million, only 1.1% above FY2025 but larger than the entire gross profit. The accounting bridge needs care because the filing distinguishes the loss before levy and taxation from the loss before taxation. ANTM recorded a PKR 93.311 million loss before levy and tax; a PKR 56.771 million levy took the loss before taxation to PKR 150.082 million. A PKR 35.035 million tax credit then reduced the net loss to PKR 115.047 million. This reconciles the apparently different pre-tax subtotals without mixing accounting bases.

What weakened and needs attention

Gross profitability remains the central weakness. A 0.97% gross margin gives ANTM almost no room for normal selling, administrative and financing costs. Even if revenue continues to grow, the business will struggle to reach break-even unless the spread between selling prices and production costs improves materially. The next result should be judged less by top-line growth alone and more by whether gross profit grows faster than revenue.

Overhead moved in the wrong direction. Administrative expenses increased by PKR 17.270 million and distribution cost by PKR 3.597 million. Together, those two increases exceeded the PKR 8.137 million decline in gross profit and explain most of the deterioration in the operating result. Management’s ability to contain fixed and semi-fixed costs is therefore as important as any recovery in yarn pricing.

The capital structure still carries risk despite lower year-end debt. Current assets of roughly PKR 537.9 million remained below current liabilities of approximately PKR 847.4 million, a gap of about PKR 309.5 million. Cash and bank balances were only PKR 15.9 million. The annual report also indicates that loans from directors increased to PKR 680 million from PKR 360 million, highlighting continued sponsor support. That support helps liquidity, but dependence on related-party funding is not the same as self-funded operating strength.

Accumulated losses were reported at approximately PKR 347.3 million. Total equity increased materially to around PKR 1.050 billion despite the annual loss, which implies that movements outside retained earnings—rather than earnings recovery—supported book equity. Readers should therefore avoid interpreting higher year-end equity as evidence that operating performance improved.

Quarterly shape and historical context

The full-year result masks a comparatively better final quarter. Using the reported quarterly series, the June 2026 quarter produced revenue of about PKR 1.017 billion, gross profit of PKR 29.1 million and an operating profit of PKR 23.1 million, versus a PKR 37.993 million gross loss and PKR 56.251 million operating loss in the June 2025 quarter. The final-quarter net loss narrowed to approximately PKR 13.879 million from PKR 59.041 million.

That improvement is encouraging but not enough to establish a durable turnaround. The first three quarters of FY2026 generated cumulative losses that outweighed the better closing quarter, and the company has posted net losses in four consecutive financial years from FY2023 through FY2026. FY2022 was the last profitable year in the available annual history, with net income near PKR 96.5 million and a 6.8% gross margin. The comparison shows how far present margins remain below a sustainably profitable level.

The fourth-quarter figures are derived by aligning the reported quarterly series with the audited full year. They should be treated as a bridge, not as a substitute for a separate quarterly cash-flow statement. The analysis therefore makes no claim about fourth-quarter cash conversion.

Sector and financing context

Pakistan’s textile environment offered selective demand support but remained difficult for spinning economics. The Pakistan Economic Survey showed textile production growth of just 0.7% in July–March FY2026, while official trade reporting pointed to stronger value-added exports and mixed performance across individual textile categories. ANTM’s near-flat revenue alongside margin compression fits that uneven backdrop, but the public filing does not quantify export volumes, utilization, selling prices, cotton costs or energy consumption for the year.

Financing conditions were still restrictive. The State Bank of Pakistan held the policy rate at 11.5% on 14 September 2026. That is a later date than ANTM’s financial year-end, so it is context rather than a direct explanation of FY2026 finance cost. Even with borrowing reduced at year-end, the company’s PKR 50.1 million annual finance charge remained economically large relative to gross profit.

AlphaGen model scores

These are AlphaGen model outputs, not figures reported by AN Textile Mills Limited and not investment recommendations.

  • Alpha QoQ Score: 83.81
  • TTM Performance Score: 34.76
  • 3Y Business Perf Score: 42.21
  • Sector Leadership Score: 46.8046

The contrast is informative: the strong quarter score captures the better June-quarter operating shape, while the weaker trailing, three-year and sector-relative scores reflect persistent annual losses and thin structural margins. A single improved quarter should not outweigh the longer record until it repeats.

What to monitor next

  • Gross margin: a sustained move above the current sub-1% level is the clearest requirement for operating recovery.
  • Overhead discipline: distribution and administrative expenses need to stop growing faster than sales.
  • Financing and levy burden: monitor finance cost, the levy line and the distinction between pre-levy and pre-tax subtotals.
  • Working-capital durability: determine whether lower inventory and receivables reflect efficient conversion or temporarily reduced activity.
  • Liquidity and sponsor funding: track the current-liability gap, cash balance and reliance on directors’ loans.
  • Repeatability of Q4: another quarter of positive gross and operating profit would make the improvement more credible.

Bottom line

ANTM’s FY2026 result is weaker than the modest sales growth suggests. Turnover rose, but the production spread narrowed, overhead climbed and the net loss widened. Positive operating cash flow, lower inventories and lower year-end debt are genuine offsets, while the better final quarter offers a possible starting point for recovery. Still, the company remains loss-making, heavily dependent on a very thin gross margin and supported by director financing. The next result must show sustained margin repair—not merely revenue growth—to change that assessment.

Evidence limitation: the original PSX annual-report PDF was identified but could not be retrieved in this run. The exact period, headline earnings and payout were verified against PSX’s official financial-announcement feed, while detailed filing figures were cross-checked against public mirrors of the same issuer filing. The article omits unsupported claims about volumes, pricing, utilization and quarterly cash conversion.

Sources and methodology

Percentages are calculated from the cited reported figures and may differ slightly because of rounding. Quarterly bridge figures are derived from aligned reported periods. AlphaGen was used only as an internal cross-check and for the four labelled model scores; it is not a public financial source.

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