IBLHL reported earnings per share of PKR 2.11 in FY25 (FY24: PKR 0.08). Earnings are significantly higher than the previous year, showing a very healthy increase though profits are still limited by the minimum tax regime. In 1QFY26, EPS stood at PKR 0.71 (1QFY25: 0.61).
IBL Healthcare is engaged in the marketing and distribution of nutrition, medical devices, nutraceuticals, and consumer products related to health and wellness. The company clarified that it is not solely a distribution company. It owns brands and arranges for their manufacture, often utilizing tolling arrangements or sometimes using Searle factories. For the actual physical distribution function, IBL utilizes IBL’s distribution arm, acting more as a marketing, management, and supply chain company. The mandate is increasingly focused on developing more and more local products.
The increase in gross margins observed in 1QFY26 was due to rationalizing lower-margin products. The company divested traditional pharmaceutical products and the ophthalmology portfolio, which were more oriented toward a pharmaceutical company than a health and wellness company. The long-term goal for IBL Healthcare is to triple the size of the company by 2030. Immediate focus is on Stevia-based sweeteners and Cold, Cough, and Flu remedies. Portfolio expansion is also on cards, with women’s health and holistic adult nutrition.
The company is also focusing on localization to mitigate the impact of foreign currency risk and inflationary pressures. Export will be followed by localization. The biggest current item is the price repositioning (relaunch) of the Mead Johnson portfolio. The pricing has been moved from the super-premium side to squarely within the premium infant formula pricing range. This change has already begun to yield significant upside in both revenue and units.
The closure of the Afghan border does not materially impact IBL Healthcare as the company did not have any cross-border sales to Afghanistan. A slightly positive impact might be seen if previously smuggled items via the Afghan border are prevented from entering the local supply chain.
Important Disclosures
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