DG Khan Cement Company Ltd. (DGKC) Turns Profitable with Strong Margins in FY25

Posted by: Tania Farooq Like: 0 Post Date: August 29, 2025

DG Khan Cement Company Ltd. (DGKC) Turns Profitable with Strong Margins in FY25

D.G. Khan Cement Company Ltd. (DGKC) has announced its results for the April–June 2025 quarter (4QFY25), and the company has made a strong comeback. After reporting a loss in the same period last year, DGKC posted solid profits this time, supported by stronger margins, lower costs, and reduced finance expenses.

Key highlights (4Q FY25)

Profit After Tax (PAT): PKR 3.2 billion (EPS: 7.2)
- Compared to a loss of PKR 1.7 billion (LPS: 3.9) last year
Revenue: PKR 16.8 billion, down 1% YoY due to slightly lower cement sales volumes (1.28mn tons, -1.2% YoY)
Dividend: Final cash payout of PKR 2.0/share

What drove the profit?

Higher Gross Margins: Margins rose to 31.8% (vs. 7.9% last year).
- This was mainly due to falling coal prices and lower electricity tariffs, which reduced production costs.
Lower Finance Costs: Finance expenses dropped 70% YoY to PKR 571mn.
- This was driven by a 36% reduction in debt and lower interest rates.
Operating Expenses: Down 2% YoY, thanks to reduced distribution costs.
Lower Tax Rate: The Effective tax rate came in at 26%, compared to 44% in the previous quarter.

Full-year FY25 performance

Profit: PKR 8.7 billion (EPS: 19.8) vs. only PKR 0.5 billion (EPS: 1.2) in FY24
That’s a 16x jump in yearly earnings
Revenue for FY25 grew 9% YoY to PKR 71.9 billion, while costs fell due to lower fuel and energy prices.

The bottom line

DG Khan Cement has staged a strong turnaround in FY25. The company benefited from cheaper coal, lower energy tariffs, reduced debt, and lower interest rates, all of which helped boost margins and profits.

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With a PKR 2/share dividend announced, shareholders also stand to gain. However, with revenues slightly down in the last quarter, demand-side pressures are something to keep an eye on.

DGKC’s earnings recovery shows how much cost efficiencies and debt reduction can strengthen profitability, even when sales volumes remain soft.

Source: AKD Securities

⚠️ 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 →

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