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Bannu Woollen Mills Limited (BWML) has shown resilience and adaptability amidst a challenging economic environment during the first quarter of the ongoing fiscal year 2024-25, reports WealthPK.

During 1QFY25, BWML faced pressure on profit margins due to rising inflation and fluctuating exchange rates. However, the company remained committed to boosting sales growth and tackling liquidity issues by ensuring sufficient working capital. BWML was established in Pakistan in 1960 as a public company specializing in the production and sale of woollen yarn, fabric, and blankets. The company's interim financial results available with the Pakistan Stock Exchange (PSX) highlight a robust performance, with net sales surging by 66% year-over-year (YoY) to Rs321.29 million in 1QFY25.

This marks a turnaround from prior sales of Rs193.8 million, underscoring BWML's strong growth trajectory. The report also explores the company's financial highlights, operational achievements, and future prospects. Furthermore, the gross profit almost doubled, reaching Rs100.20 million against Rs51.11 million in the same period last year. This improvement highlights BWML's enhanced operational efficiency and strong cost management practices. Similarly, the profit from operations surged to Rs57.04 million from just Rs6.31 million in 1QFY24, showcasing the company’s ability to streamline operations and control expenses.

The financial turnaround is further evident in the profit-before-taxation, which stood at Rs30.91 million, posting a notable recovery from the previous year's loss of Rs22.64 million. Thus, the earnings per share (EPS) also improved significantly, recorded at Rs2.22 compared to a loss per share of Rs2.13 in the same period last year. During the period under review, the company produced 177,551 meters of fabric, which was lower than the 244,500 meters produced in the same period last year. Nevertheless, BWML successfully maintained its gross profit margins, demonstrating effective cost management amidst rising raw material prices and increased power expenses.

Additionally, finance costs for the quarter amounted to Rs26.14 million, reflecting a slight improvement from Rs28.95 million in 1QFY24. This indicates better financial resource management and a focus on controlling expenses. Looking ahead, the management remains optimistic about an anticipated rise in demand in the coming quarters. It also expects that easing import restrictions and stabilising currency rates will provide opportunities for sustained growth and profitability in the future.

Credit: INP-WealthPk