Engro Fertilizers earnings decline 16% in first half as demand softens after strong 2025 push.

Muneeba

Agriculture Desk

July 30, 2026

2 min read

Engro Fertilizers earnings decline 16pc first half 2026

Engro Fertilizers Limited reported consolidated profit after tax of Rs7.12 billion for the half year ended June 30, 2026, a 16 percent decline from Rs8.46 billion in the same period last year.

Earnings per share (EPS) came in at Rs5.33 compared with Rs6.34 previously. Despite the lower earnings, the board recommended a second interim cash dividend of Rs1.75 per share.

Second-Quarter Performance Weaker

In the April-June quarter, net profit fell 32 percent year-on-year to Rs3.80 billion. Net revenue dropped 34 percent to Rs33.07 billion, reflecting a sharp contraction in both urea and Di-Ammonium Phosphate (DAP) sales.

Urea volumes in Q2 declined 41 percent while DAP offtake tumbled 68 percent. The company recorded its lowest first-half urea sales in ten years at 537,000 tons.

Cost and Margin Dynamics

Gross profit for the half year stood at Rs23.56 billion, down 11 percent. Gross margins, however, improved slightly to 33 percent from 33 percent a year earlier and expanded further in the second quarter.

A one-off gain linked to the Sindh Infrastructure Development Cess of about Rs1.8 billion provided support to the bottom line. Distribution expenses rose during the period, while administrative costs remained contained. Finance costs increased 15 percent to Rs3.30 billion.

Shareholder Payout Continues

The Rs1.75 per share dividend takes the cumulative H1 distribution to Rs3.75 per share. Book closure is scheduled for August 11–12, 2026, with entitlement for shareholders registered by August 10.

The payout ratio for the half year remained healthy at around 70 percent of total earnings.

Sector Context and Near-Term Challenges

Industry offtake remained under pressure following heavy distributor buying in the final quarter of 2025. Elevated inventory levels at Engro and across the broader sector are expected to keep sales muted in the coming months unless farm economics improve or pricing adjusts.

The company continues to focus on operational efficiency and price discipline in a challenging demand environment.

Written by

Muneeba

Muneeba Zaman is a Karachi-based digital content creator and social media specialist. She creates business, tech, AI, and digital marketing content for Headline Recorder, with a focus on clear storytelling, brand consistency, and creative direction.