Cherat Cement Company Ltd. (CHCC) announced its 3QFY26 financial results, reporting profitability of PkR1.4bn (EPS: PkR7.2), down 16%YoY from PkR1.7bn (EPS: PkR8.7) in SPLY, primarily attributed to lower offtakes and higher coal cost. Earnings came in lower than our expectations due to higher-than-anticipated COGS and opex:

·        Revenue inched up by 1%YoY to PkR7.9bn, as 3%YoY higher local prices outweighed the impact of 3%YoY decline in total offtakes, due to lower exports amid Afghan border closure.

·        Gross margins contracted to 31.0% from 40.0% in SPLY, driven by higher coal prices.

·        Operating expenses rose by 9%YoY to PkR384mn, primarily led by higher distribution cost despite absence of exports, likely due to higher fuel cost.

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