Introduction:

Pakistan textile sector is the major contributor in the countrys economy mainly from its large cotton producing
capacity. The country currently ranks as the 4th largest producer of cotton in the world and has duly capitalized on
this capability by developing and promoting its textile sector. As a result, Pakistan now also has the third largest
spinning capacity in all of Asia.

The importance of the textile sector as an integral part of Pakistans economy is highlighted by the following facts: -

It provides employment to over 40% of industrial labor force

It contributes 8.5% to GDP
It accounts for 40% of banking credit
It holds approximately 60% share in national exports

In this report we are going to discuss some financial analysis of the below mentioned leading textile industries of the
Pakistan.

Gul Ahmed Textile

Nishat Textile
Crescent Textile

Gul Ahmed Textile:

The mill is presently a composite unit with an installed capacity of 130,000 spindles, 250 wide width air jet looms,
90 Sulzers, 297 conventional looms, and a state-of-the-art processing and finishing unit. It is a fully vertically
integrated textile unit, operating in all segments of the textile value chain.
Ideas by Gul Ahmed is the retail venture of Gul Ahmed Textile Mills Limited. Considering the growing trend towards
the retail industry in Pakistan, as well as the increase in cotton prices and the need to focus more on value-
added products.
Financial Performance Indicator:

2016 2015 Change

Export Sales 19742 20986 -6%
Local Sales 12398 12267 1%
Gross Profit 7306 6094 20%
Profit Before Tax 1335 783 70%
EBITDA 3371 3094 9%
EPS 4.27 2.3 86%
ROE 14.37 8.75 64%

Nishat Textile:
Nishat Mills Limited (the Company) is the most modern and largest vertically integrated textile Company in
Pakistan. The Company commenced its business as a partnership firm in 1951 and was incorporated as a private
limited Company in 1959. Overall, the Company has 32 manufacturing units each specializing in a specific product
range located in Faisalabad, Sheikhupura, Ferozewatwan and Lahore. A major portion of the Companys earnings is
export based. Over the years, the Company has achieved significant geographical diversification in its export sales
mix.

Financial Performance Indicator:

 2016 2015 Change
Net Sales 47999 51200 -6%
Gross Profit 6264 6046 4%
Profit Before Tax 5725 4389 30%
EBITDA 8937 8260 8%
EPS 14 11.13 26%
ROE 6.22 5.41 15%

Crescent Textile:
The Crescent Textile Mills Limited engages in textile manufacturing activities in Pakistan. It operates through five
segments: Spinning, Weaving, Processing and Home Textile, Power Generation, and Cold Storage. The companys
activities include spinning, combing, weaving, dyeing, bleaching, printing, stitching, buying, selling, and dealing in
yarn, cloth and other goods, and fabrics made from raw cotton and synthetic fiber. It processes greige fabric for
production of printed and dyed fabric; and offers a range of home textile and hospitality products, including quilted
bed-in-a-bag items, bed linen, table linen, kitchen linen, furnishings, etc. The company also generates, accumulates,
distributes, supplies, and sells electricity. In addition, it operates a cold storage unit for making ice and warehousing
perishable goods. The company also exports its products to the United States, Europe, Asia, Africa, and Australia.

Financial Performance Indicator:

2016 2015 Change

Net Sales 10579 11779 -10%
Gross Profit 1340 1457 -8%
Profit Before
347 358 -3%
Tax
EPS 3.57 3.89 -8%
ROE 5.51 6.39 -14%
Ratios Analysis:
Crestex Gul Ahmed Nishat
Ratio
2016 2015 2016 2015 2016 2015
Profitability Ratios
Gross Profit Ratio % 12.67 12.37 22.64 18.27 13.05 11.81
Net Profit to Sales % 2.37 1.87 3.54 1.81
Return on Equity % 5.51 6.39 14.37 8.75 6.22 5.41
Return on Capital Employed % 2.6 2.56 18.97 22.01 8.01 7.79
EBIT Margin to Sales % 8.71 8.32 10.43 9.28 18.62 16.13
Investment/Market Ratios
Earnings Per Share (EPS) Rupees 3.57 3.89 4.27 2.3 14 11.13
Price Earnings Ratio Times 5.26 5.43 8.47 18.53 7.71 10.26
Dividend Yield Ratio % 6.67 6.86 - 0.03 4.63 3.94
Dividend Payout Ratio Times 40 40.45 - 56.6 35.71 40.43
Break Up Value Per Share without
Surplus on Revaluation of Fixed Rupees 56.9 56.45 29.35 31.37 233.66 216.56
Assets
Break Up Value Per Share
Including the Effect of Surplus on Rupees 84.58 93.3
Revaluation of Fixed Assets
Capital Structure Ratios
Interest Coverage Ratio Times 1.96 1.84 2.47 1.59 6.47 3.52
Liquidity Ratios
Current Ratios Times 0.9 0.81 1.08 1.05 1.32 1.26
Quick Ratios Times 0.62 0.58 0.26 0.24 0.75 0.65
Activity/Turnover Ratios
Inventory Turn Over Ratio Times 6 7 1.99 2.35 4.12 3.91
No of Days in Inventory Days 59 50 184 155 88.83 93.35
Debtor Turn Over Ratio Times 4 5 15.09 20.33 18.22 17.22
No of Days in Receivables Days 85 75 20.09 21.2
Creditor Turn Over Ratio Times 9 10 3.38 3.1 4.65 5.84
No of Days in Creditor Days 120 118 78.71 62.5
Total Asset Turnover Ratio Times 0.76 0.95 1 1.34 0.45 0.51
Fixed Asset Turn Over Ratio Times 2.68 3.69 1.94 2.1
Operating Cycle Days 105 88 88 55 30.21 52.05

Profitability Ratios:
Non-Financial Factors Affecting Textile Sectors: