Engro Fertilizers hit by double whammy of low prices and high taxes

Engro Fertilizers (EFERT) has long been treated by Pakistani equity investors as the sort of stock you buy when you want to sleep at night: a defensive business tied to food security, plus a dividend stream that arrives with near-calendar regularity. In calendar year 2025, that reputation took a knock – not because the company stumbled operationally, but because two pressures hit at once: weaker realised prices and a heavier tax bite.

According to the company’s CY25 result reviews published by Arif Habib Limited (AHL) and Topline Securities, net sales fell 8% year-on-year to Rs237.1 billion, down from Rs256.7 billion in CY24.

The earnings line fell harder. Profit after tax declined 20% to Rs22.6 billion, translating into EPS of Rs16.95, compared with Rs28.3 billion and EPS of Rs21.16 a year earlier.

Then came the part that income-focused shareholders notice most: cash dividends. Alongside the results, Engro Fertilizers declared a full-year dividend of Rs15 per share, down from Rs21.5 per share last year – a cut of roughly 30%.

Even the quarter, despite being a volume-heavy period, carried a sting. 4QCY25 profit fell 19% year-on-year to Rs8.4 billion (EPS Rs6.26), and the 4Q dividend was Rs4 per share, down from Rs8 per share in 4QCY24.