AGTL earnings preview 2QCY25: slower sales hit profit, but recovery seen QoQ

Al-Ghazi Tractors Ltd. (AGTL), one of Pakistan’s key tractor makers, is expected to post a sharp drop in earnings for the second quarter of 2025. But the good news? Sales have improved compared to the previous quarter, a possible sign of recovery ahead.

What’s expected?

• Profit after tax (PAT) is expected at Rs178 million, which means earnings per share (EPS) of Rs3.1
• This is down 80% year-on-year (YoY) compared to Rs15.2 EPS in the same period last year
• Revenue (sales) is expected at Rs4.5 billion, which is 43% lower YoY
• Sales volume (number of tractors sold) dropped by around 40% YoY

What’s improving?

• On a quarter-on-quarter (QoQ) basis (compared to Jan–Mar 2025), things look better:
  • Revenue is up 25%
  • Volumes (tractors sold) are up 34%
  • Gross margins are improving slightly, expected at 21.8%, up 0.3 percentage points QoQ

Cost pressures

• Selling and distribution expenses have surged nearly 10 times YoY as marketing and logistics picked up
• Admin costs are also up, rising 34% YoY and 11% QoQ

Bottom line:

AGTL’s profits are under pressure compared to last year due to lower tractor sales and higher expenses. But there’s a silver lining, demand picked up this quarter, and if the trend continues, AGTL could be on track for a better second half of the year.

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The company’s performance will likely depend on government support for agriculture, farmer purchasing power, and the rollout of tractor subsidy programs like Punjab’s Green Tractor Scheme.

Source: Insight Securities (Private) Limited

⚠️ 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 →