Pak Qatar Family Takaful Earnings Review: Can Pension Growth Offset Pressure on Core Income?

Released on: 24 August 2026

What did Pak Qatar Family Takaful report?

Pak Qatar Family Takaful Limited (PAKQATAR) reported earnings per share of PKR 1.97 for CY25, compared with PKR 1.82 in CY24. Profit after tax increased to PKR 291 million from PKR 270 million, while total comprehensive income rose to PKR 280 million from PKR 261 million.

PKR million	CY24	CY25	YoY
Wakala fee	1,353	1,131	-16%
Commission expense	-599	-395	-34%
Takaful operator fee	1,066	1,540	44%
Investment income	217	128	-41%
Net realised fair value gains on investments	74	82	11%
Other income	16	17	7%
Net income	2,127	2,503	18%
Acquisition expenses	-815	-931	14%
Marketing & administrative expenses	-904	-1,100	22%
Other expenses	-14	-14	2%
Mark-up on finance lease	-27	-29	7%
Profit before tax	366	429	17%
Taxation	-97	-138	42%
Profit after tax	270	291	8%
Total comprehensive income	261	280	7%
EPS (PKR)	1.82	1.97	—

Did the business actually grow?

Yes, at the contribution level. Gross contribution increased to PKR 30 billion in 2025 from PKR 28.8 billion in 2024. However, the earnings picture is more complicated. Wakala fee income declined 16% despite higher gross contributions, while takaful operator fee income jumped 44%. The increase in operator fee income was enough to help net income rise 18% to PKR 2.5 billion. The company also significantly reduced commission expenses, which fell to approximately PKR 395–400 million from around PKR 600 million. Management attributed this improvement to product restructuring and changes in the business mix.

What is the biggest positive surprise?

The sharp reduction in commission expenses stands out.

Metric	CY24	CY25	Change
Gross contribution	PKR 28.8bn	PKR 30bn	Increase
Commission expense	~PKR 600mn	~PKR 395–400mn	Significant decline
Wakala fee	PKR 1,353mn	PKR 1,131mn	-16%
Takaful operator fee	PKR 1,066mn	PKR 1,540mn	44%

The company managed to increase net income despite lower Wakala fees and sharply lower investment income. The improvement in commission expenses and higher takaful operator fees were important contributors.

Why did investment income fall sharply?

Investment income declined 41%, from PKR 217 million to PKR 128 million. This is one of the abnormal elements in the earnings report because the decline was substantial while net realised fair value gains on investments increased 11%, from PKR 74 million to PKR 82 million. Despite the investment income decline, overall profitability remained positive because other parts of the business offset the weakness.

Are expenses becoming a problem?

Marketing and administrative expenses increased 22% to PKR 1.1 billion, while acquisition expenses increased 14% to PKR 931 million.

 

Expense	CY24	CY25	YoY
Acquisition expenses	PKR 815mn	PKR 931mn	14%
Marketing & administrative expenses	PKR 904mn	PKR 1,100mn	22%
Total expenses	PKR 1,734mn	PKR 2,045mn	18%

This matters because total expenses increased at the same 18% rate as net income. So while earnings improved, the company has not achieved a clean operating-cost expansion story.

What is happening with the pension fund business?

This could become an important growth driver. PQFTL has expanded its branch network to 82 branches:

Region	Branches
South	11
North	35
Central	36
Total	82

The company has already registered more than 1,000 individuals in Khyber Pakhtunkhwa, with payment transactions underway. Management is targeting 2,500–3,000 accounts by December 2026. In Punjab, the scheme was launched in December and more than 1,200 individuals have already been registered. In Balochistan, the first transaction has been completed and approximately 2,500 accounts have been opened. Under these schemes, 10% of an employee’s basic salary is deducted, while the relevant provincial government contributes an additional 12%. The funds are routed to PQFTL as Pension Fund Manager for investment.

Could the new tax framework improve customer retention?

The final Finance Act reduced the required policy holding period for exemption from tax on redemption gains from seven years to four years.

Policy holding period	Tax on redemption gains
Less than 1 year	15%
1–4 years	10%
More than 4 years	Exempt

Management views the revised framework positively because it gives customers a stronger incentive to retain policies for at least four years.

What is the next major growth opportunity?

The Federal Government and Sindh Government have already signed agreements with PQFTL. Actual transactions are expected to begin within the next 3–6 months, once the required administrative and operational systems are finalized. This could expand the company’s pension fund management business beyond the provincial schemes where registrations are already progressing.

What are the key abnormal elements in CY25?

Several figures deserve close attention:

• Investment income fell 41% despite an 18% increase in net income.
• Wakala fee income declined 16%, even though gross contributions increased from PKR 28.8 billion to PKR 30 billion.
• Takaful operator fee income surged 44%, becoming an important offset to weaker Wakala and investment income.
• Marketing and administrative expenses increased 22%, while acquisition expenses increased 14%.
• Taxation increased 42% to PKR 138 million despite profit before tax rising only 17%.
• Unrealised gains on available-for-sale investments fell from PKR 62 million to zero.

What do the market figures look like?

Market Data	Value
Symbol	PAKQATAR
Current Price	PKR 19.99
Market Capitalisation	PKR 4.61bn
Total Shares	230.71mn
Free Float	80.74mn
52-Week High	PKR 29.40
52-Week Low	PKR 15.24

What should investors watch next?

• Pension fund registrations could accelerate as Punjab and Khyber Pakhtunkhwa governments withhold salaries from employees who fail to open the required pension accounts.
• Management is targeting 2,500–3,000 pension accounts in Khyber Pakhtunkhwa by December 2026.
• Federal and Sindh government agreements could begin generating transactions within the next 3–6 months.
• The four-year tax exemption threshold could encourage customers to retain policies for longer periods.
• The company will need to demonstrate that higher contributions can translate into sustainable earnings without a corresponding acceleration in operating expenses.
• The sharp decline in investment income remains an important issue to monitor.

Verdict

PAKQATAR’s CY25 result is positive, but not clean. EPS improved 8%, net income rose 18%, and gross contributions reached PKR 30 billion. The pension-management pipeline is the most interesting part of the story. But I would not blindly call this a strong earnings-growth story yet. Wakala fees fell 16%, investment income plunged 41%, and administrative expenses jumped 22%. The real test is whether the expanding pension business and revised tax framework can produce recurring income growth rather than relying on changes in business mix and cost savings.

⚠️ This post reflects the author’s personal opinion and is for informational purposes only. It does not constitute financial advice. Investing involves risk and should be done independently. Read full disclaimer →