Engro Fertilizer announced its 1QCY26 results today. The company reported a net profit of Rs 3.3 billion, with earnings per share at Rs 2.49. That means Engro Fertilizer profit up 14% compared to the same period last year. The company also declared a dividend of Rs 2.0 per share. The payout sits at 80 percent, which is lower than historical levels. Last year’s dividend was Rs 2.25 per share.

Net sales increased 25 percent year-on-year but tell a different story quarter-on-quarter. A sharp 73 percent sequential fall in urea offtake drove the decline. The previous quarter saw Engro’s highest-ever urea sales at 1.03 million tons. Strong Rabi demand created elevated dealer inventories. Softer demand followed in the current quarter. Engro reduced discounts from Rs 400 per bag to Rs 150 per bag in January. The company fully withdrew discounts from April 4, 2026. Market share dropped to 26.9 percent.

Engro Fertilizer profit up despite several headwinds. DAP offtake rose 62.3 percent year-on-year to 40 thousand tons. Distribution costs increased slightly by 1 percent to Rs 3.3 billion. Finance costs rose 31 percent due to PEF-related capex financing and higher inventory levels. Cash and short-term investments declined to Rs 17 billion in March. Inventories rose to Rs 34.2 billion, reflecting weaker offtake. The company holds 386 thousand tons of inventory, accounting for 48 percent of total industry stocks. Debt levels increased 15 percent quarter-on-quarter to Rs 77 billion.