HUBCO profit falls 3% as higher tax outlay offsets strong operating gains

The Hub Power Company Limited (Hub Power Company Limited) reported a nearly 3 percent decline in consolidated profit for the quarter ended March 31, 2026, as higher taxation and softer revenue outweighed gains from operations and other income streams.

According to a notice submitted to the Pakistan Stock Exchange, the power producer posted a profit of Rs12.13 billion in 3QFY26, compared with Rs12.48 billion in the same period last year. Earnings per share also slipped to Rs8.33 from Rs8.51 in the corresponding period of the previous year.

The company declared an interim cash dividend of Rs5 per share (50 percent) for the third quarter ended March 31, 2026, in addition to an already paid interim dividend of Rs10 per share (100 percent).

On the revenue side, consolidated income from contracts with customers declined nearly 4 percent to Rs16.5 billion in 3QFY26, down from Rs17.1 billion in the same period last year. Cost of revenue also eased 2 percent to Rs9.86 billion, compared to Rs10.08 billion previously, resulting in a gross profit of Rs6.6 billion. However, gross margin slipped slightly to 40.1 percent from 40.9 percent a year earlier.

Despite weaker topline performance, other income surged sharply by around 146 percent to Rs3.96 billion, up from Rs1.61 billion in the prior-year period. This supported a stronger operating performance, with profit from operations rising 18 percent to Rs9.85 billion.

Finance costs declined more than 28 percent to Rs2.1 billion, while the company’s share of profits from associates and joint ventures increased 8 percent to Rs11 billion.

As a result, profit before taxation rose 20 percent to Rs18.8 billion. However, the overall bottom line was impacted by a sharp increase in taxation, which climbed 127 percent to Rs6.7 billion during the quarter, ultimately leading to the reported decline in net profit.

The mixed performance reflects a combination of cost relief at the financing level, stronger contribution from associates, and a significant rise in tax burden that weighed on final earnings despite improved operational indicators.