Service Global Footwear Limited (PSX: SGF) reported a significant improvement in profitability for the year ended December 31, 2025, with net profit after taxation surging 75.08% to Rs1.94 billion, compared to Rs1.11 billion in the previous year. The exceptional performance was driven by strong revenue growth, lower finance costs, and a sharp increase in share of profit from an associate.
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Earnings per share (EPS) showed robust growth, with basic EPS increasing to Rs9.38 in 2025 from Rs5.37 in 2024—a gain of approximately 74.7%. Diluted EPS rose to Rs9.32 from Rs5.34, up about 74.5% year-on-year.
Dividend Announcement
Reflecting the strong earnings performance, the Board of Directors declared a final cash dividend of Rs2.00 per share (20%) for the year ended December 31, 2025, rewarding shareholders for the company’s exceptional performance.
Revenue and Gross Profit
Revenue from contracts with customers recorded a positive trajectory, growing 14.34% to Rs19.89 billion in 2025 from Rs17.39 billion last year. This top-line expansion demonstrated sustained demand for the company’s footwear products across its markets.
On the cost side, cost of sales increased 13.28% to Rs16.43 billion, slightly slower than revenue growth. This resulted in gross profit of Rs3.46 billion, up 19.67% versus Rs2.89 billion in 2024, showing an expanding gross margin driven by revenue growth outpacing cost pressures.
Operating Performance
Operating expense trends were mixed, reflecting ongoing investments in growth:
| Expense Category | 2025 | 2024 | Change |
|---|---|---|---|
| Distribution Costs | Rs1.55bn | Rs1.35bn | +14.78% |
| Administrative Expenses | Rs924.38m | Rs776.65m | +19.02% |
| Other Expenses | Rs78.88m | Rs109.37m | -27.88% |
Other expenses declined nearly 28%, providing partial relief to operating profitability. However, other income contracted 42.76% to Rs182.73 million, compared with Rs319.24 million in the previous year, restraining overall earnings support from ancillary sources.
As a result of these dynamics, profit from operations increased 11.81% to Rs1.09 billion, up from Rs970.78 million in 2024.
Finance Cost Reduction
Finance cost declined significantly by 27.97% to Rs480.48 million, down from Rs667.08 million last year. This reduction in debt-servicing costs helped bolster earnings before equity contributions and reflects improved liability management.
Associate Contribution: The Game-Changer
The single most important driver of SGF’s exceptional profit growth was the share of net profit of associate, which surged 72.13% to Rs2.28 billion, compared with Rs1.32 billion in 2024. This substantial increase from the associate investment significantly lifted the company’s bottom-line results.
Bottom Line Impact
Boosted by strong associate performance and lower finance costs, profit before levy and taxation climbed 77.18% to Rs2.88 billion, from Rs1.63 billion last year.
After accounting for a levy of Rs92.85 million (down 52.90%) and income tax of Rs854.63 million (up 163.38% due to higher taxable profits), the company posted a net profit after taxation of Rs1.94 billion for 2025.
Financial Summary
| Metric | 2025 | 2024 | Change |
|---|---|---|---|
| Net Revenue | Rs19.89bn | Rs17.39bn | +14.34% |
| Gross Profit | Rs3.46bn | Rs2.89bn | +19.67% |
| Operating Profit | Rs1.09bn | Rs970.78m | +11.81% |
| Finance Cost | Rs480.48m | Rs667.08m | -27.97% |
| Share of Associate Profit | Rs2.28bn | Rs1.32bn | +72.13% |
| Profit Before Tax | Rs2.79bn | Rs1.43bn | +95.12% |
| Net Profit | Rs1.94bn | Rs1.11bn | +75.08% |
| Basic EPS | Rs9.38 | Rs5.37 | +74.67% |
| Dividend | Rs2.00/share | – | – |
About Service Global Footwear Limited
Service Global Footwear Limited (PSX: SGF) is a leading Pakistani footwear manufacturer, producing high-quality shoes for domestic and international markets. The company is part of the Service Group, a diversified business conglomerate with interests in footwear, textiles, and other sectors.
