MACPAC Films Limited

MACPAC Films Limited (MACFL) was incorporated in Pakistan as a limited liability company in 1993. The company is engaged in the manufacturing, buying and selling of plastic packaging. MACFL specializes in Biaxially oriented polypropylene (BOPP) and Cast polypropylene (CPP) films as well as different value addition films. Pattern of Shareholding As of June 30, 2025, MACFL has a total of 59. 301 million shares outstanding which are held by 1508 shareholders. Directors, CEO, their spouses and minor children have the majority stake of 63. 23 percent in the company followed by local general public holding 20. 73 percent shares of the company. Government of Pakistan holds 7. 87 percent shares of MACFL through EOBI. The remaining shares are held by other categories of shareholders. Financial Performance (2019-25) Barring 2020, MACFL’s topline has followed an upward journey over the period under consideration. Conversely, its bottomline tells a different tale. In 2019 and 2020, the company posted operating and net losses. It recovered from losses in 2021. In 2022, MACFL’s bottomline took a nosedive, however stayed in the green zone. In 2023, MACFL registered the highest bottomline growth and an unprecedented level of net profit which plunged in the subsequent years. MACFL’s margins follow the same path as its bottomline and maxed out in 2023 followed by a dip in 2024 and 2025 (see the graph of profitability ratios). The detailed performance review of the period under consideration is given below. In 2019, MACFL’s topline registered 13. 65 percent year-on-year growth to clock in at Rs. 2415. 34 million. During the year, the company’s sales volume stood at 8302 MT which included CPP as well as BOPP. During the year, the company enhanced its product portfolio by starting the commercial operations of its newly installed CPP plant with an annual capacity of 7000 MT. During the first year of its production, the CPP plant managed to produce 1121 MT of CPP. However, the sales growth couldn’t trickle down effectively as cost of sales hiked by 21. 53 percent year-on-year in 2019 due to soaring petrochemical landed cost which was the result of Pak Rupee depreciation. Furthermore, increased gas prices also fueled the fire. The company couldn’t increase the prices proportionately due to intense competition. As a consequence, gross profit shrank by 53. 59 percent year-on-year in 2019 with GP margin slipping to 4. 30 percent from GP margin of 10. 50 percent recorded in 2018. Administrative expense grew by 13. 61 percent year-on-year in 2019 due to higher payroll expense as the employee count increased after the installation of CPP plant. Marketing expense also surged by 19. 23 percent on account of higher payroll expense coupled with concentrated sales promotion. A massive exchange loss of Rs. 112. 496 million resulted in 203. 95 percent year-on-year growth in the other expense in 2019. Other income multiplied by 170. 91 percent year-on-year in 2019 due to reversal of provision for ECL as well as gain recorded on the disposal of operating fixed assets. Other income stood at 0. 8 percent of MACFL’s net sales in 2019 versus its share of 0. 3 percent in 2018. The company posted operating loss of Rs. 111. 96 million in 2019 versus operating profit of Rs. 88. 62 posted in 2018. Finance cost grew by 293. 67 percent year-on-year in 2019 as the company undertook capital expenditure for setting up a new plant. Moreover, higher discount rate also played a role in driving the finance cost up. MACFL recorded net loss of Rs. 233. 92 million in 2019 with loss per share of Rs. 3. 94. This was against the EPS of Rs. 0. 99 posted by the company in 2018. During 2020, MACFL’s topline registered 10. 37 percent year-on-year drop to clock in at Rs. 2164. 95 million. This was despite 16. 62 percent rise in the sales volume which clocked in at 9682 MT in 2020. The revenue drop was the consequence of changes made in the sales mix during the year. A major milestone achieved during the year was the beginning of export sales which diversified the company’s geographical outreach. The capacity utilization of BOPP plant dropped to 52 percent in 2020 from 54 percent in 2019. Conversely, CPP plant attained capacity utilization of 35 percent in 2020, up from capacity utilization of 16 percent recorded in the previous year. Cost of sales plummeted by 8. 84 percent year-on-year in 2020 due to petrochemical landed cost and GIDC levy of Rs. 31, 084 million imposed during the year. Gross profit further shrank by 44. 54 percent year-on-year in 2020 with GP margin sinking to 2. 65 percent. Administrative inched down by 0. 89 percent in 2020 primarily on account of lower directors’ remuneration and insurance charges incurred during the year. Marketing expensed dipped by 9 percent in 2020 due to curtailed sales promotion budget allocated for the year. Other expense grew by 27. 54 percent year-on-year in 2020 which was mainly due to the imposition of GIDC. However, the rise in other expense was offset by a splendid 915. 71 percent growth in other income which was the consequence of gain on the sale of leasehold land in 2020. Other income stood at a whopping 9. 4 percent of MACFL’s topline in 2020 versus its standing of 0. 8 percent in the previous year. The company’s operating loss tamed by 96 percent in 2020 to clock in at Rs. 4. 4 million. Finance cost registered 77 percent year-on-year hike in finance cost as discount rate was high for the most part of the year. MACFL registered net loss of Rs. 62. 85 million in 2020 which was 73. 13 percent lesser than the net loss recorded in 2019. Loss per share stood at Rs. 1. 06 in 2020. In 2021, MACFL’s topline posted the highest ever revenue growth of 39. 74 percent year-on-year to clock in at Rs. 3025. 32 million. This was on account of 51 percent rise in the company’s off-take which reached 14, 600 MT in 2021. The company also focused on improving its geographical footprint which was evident from the export revenue of Rs. 52 million recorded in 2021. Not only that, the local market share of the company also grew by manifold in 2021. Out of its annual capacity of 15000 MT, MACFL utilized 71 percent to produce 10, 655 MT of BOPP. CPP plant utilized 73 percent of its annual capacity and produced 5, 107 MT. Higher sales and production volume effectively absorbed the fixed cost resulting in 20 percent year-on-year hike in cost of sales in 2021, much lower than the topline growth registered during the year. Gross profit multiplied by 762. 80 percent year-on-year in 2021, translating into an impressive GP margin of 16. 36 percent, significantly up from GP margin of 2. 65 percent posted in 2020. Administrative expense grew by 28. 74 percent year-on-year in 2020 which was the effect of increased capacity utilization which required more human resources, consequently, payroll expense rose. Marketing expense registered a steep hike of 133. 68 percent year-on-year in 2021 primarily on the back of hefty carriage and octroi charges incurred during the year on account of greater sales volume. The absence of GIDC resulted in 90. 18 percent year-on-year fall in other expense in 2021. Other income also slid by 69. 48 percent year-on-year in 2021 due to high-base effect as the company recorded gain on the sale of fixed assets in the previous year. Despite elevated operating expense, MACFL was able to post operating profit of Rs. 365. 72 million in 2021 which culminated into OP margin of 12. 10 percent. Finance cost tamed by 41. 59 percent year-on-year in 2021 on account of monetary easing and improved cash flow management which resulted in reduced borrowings. MACFL was able to post net profit of Rs. 186. 67 million in 2021 as against the net loss of Rs. 62. 85 million in 2020. EPS stood at Rs. 3. 15 in 2021 while NP margin stood at 6. 17 percent. The growth trajectory continued in 2022 whereby MACFL posted 37. 97 percent year-on-year rise in its topline which was recorded at Rs. 4174. 14 million. This was the result of 15. 42 percent volumetric growth achieved in 2022. Off-take stood at 16, 851 MT in 2022, of which 11, 531 MT pertained to BOPP and the remaining 5, 500 MT were CPP. Export turnover stood at Rs. 59 million in 2022 up from Rs. 52 million in the previous year. In line with increased demand, the company operated its BOPP plant at 80. 6 percent capacity and CPP plant at 86 percent capacity in 2022. Gross profit grew by 23. 44 percent year-on-year in 2022; however, declining value of Pak Rupee shoved the GP margin down to 14. 63 percent in 2022 from GP margin of 16. 36 percent posted in 2021. Administrative and marketing expense soared by 22. 75 percent and 10 percent respectively in 2022. This was the result of unprecedented level of inflation, higher production and sales volume which pushed up the payroll expense and freight expense as well as strong sales promotion. Other expense posted an unusually high growth of 730. 20 percent in 2022 which was the effect of a massive exchange loss worth Rs. 76. 86 million incurred during the year due to pitiable state of local currency. Other income posted 27. 42 percent year-on-year escalation primarily on account of scrap sales. Operating profit registered a marginal 2. 51 percent year-on-year downtick in 2022 with OP margin sliding down to 8. 54 percent. Despite elevated level of discount rate, finance cost only grew by 2. 4 percent in 2022 as the company considerably tapered its external borrowings in 2022. The bottomline shed its value by 1. 29 percent year-on-year to clock in at Rs. 184. 25 million in 2022 with NP margin of 4. 41 percent and EPS of Rs. 3. 11. Despite myriad challenges circling the local economy, MACFL, on account of its apt sales mix was able to turn the odds in its favor and registered 31. 89 percent year-on-year rebound in its net sales which stood at Rs. 5505. 46 million in 2023. MACFL’s sales volume dropped by 4. 27 percent to clock in at 16, 132 MT in 2023; however, it was able to maintain its market share. Upward price revisions also had a say in the company’s topline growth in 2023. This is evident by cost of sales which grew by only 17. 70 percent year-on-year in 2023. Gross profit posted a staggering 114. 72 percent year-on-year jump in 2023 with GP margin climbing up to its optimum level of 23. 82 percent. Administrative surged by 43. 66 percent in 2023 due to higher payroll expense which was the effect of inflationary pressure and workforce expansion from 177 employees in 2022 to 186 employees in 2023. Marketing expense surged by 46. 79 percent in 2023 which was the result of elevated carriage and octroi charges, salaries pertaining to distribution network and increased sales promotion drives conducted during the year. 110 percent rise in other expense in 2023 was the consequence of higher provisioning done for WWF and WPPF during the year as well as enormous exchange loss. Other income grew by 45. 39 percent year-on-year in 2023 due to higher income from non-financial assets. During the year, the company booked an impairment loss worth Rs. 35. 12 million on its trade debts. Nonetheless, operating profit registered 134 percent year-on-year rise with OP margin reaching its all-time high level of 15. 16 percent in 2023. Finance cost picked up by 42. 42 percent year-on-year in 2023 and rightly so given the record level of discount rate. It is to be noted that the company paid off a significant portion of its outstanding liabilities during the year. This resulted in its gearing ratio falling down from 23. 97 percent in 2022 to 1. 97 percent in 2023. Higher effective taxation to the tune of 46 percent, up from 30 percent in the previous year somewhat diluted the bottomline growth in 2023. Net profit stood at Rs. 379. 21 million, up 105. 82 percent year-on-year. NP margin clocked in at 6. 89 percent in 2023. EPS also grew from Rs. 3. 11 in 2022 to Rs. 6. 39 in 2023. In 2024, MACFL’s net sales ticked up by only 2. 1 percent to clock in at Rs. 5619. 41 million. This was on account of 2 percent year-on-year slide in the company’s sales volume which stood at 15, 804 metric tons in 2024. Unprecedented inflationary pressure coupled with soaring energy and gas prices pushed the company’s gross profit down by 29. 37 percent in 2024 with GP margin sliding down to 16. 48 percent. Administrative surged by 51. 11 percent in 2024 on account of inflationary pressure which drove up its payroll expense. The company also expanded its workforce from 186 employees in 2023 to 214 employees in 2024. Marketing expense also escalated by 54. 05 percent in 2024 on the back of superior sales promotion drives to strengthen its geographical outreach coupled with higher freight and octroi charges incurred during the year. No exchange loss and lesser provisioning for WWF and WPPF resulted in 87. 72 percent thinner other expense incurred in 2024. Other income inched up by just 2. 71 percent in 2024 on account of exchange gain and profit from Islamic banks. MACFL’s other income was huge enough to nullify the impact of other expense. MACFL’s operating profit eroded by 33. 63 percent in 2024 to clock in at Rs. 553. 76 million with OP margin slipping to 9. 85 percent. Finance cost inched up by just 1 percent in 2024. Net profit tapered off by 32 percent in 2024 to clock in at Rs. 257. 72 million with EPS of Rs. 4. 35 and NP margin of 4. 60 percent. In 2025, MACFL’s net sales grew by 6. 68 percent to clock in at Rs. 5994. 62 million. During the year, the company conducted its periodic maintenance drive which resulted in production downtime and eventually lower production and sales volumes. Sales volume was recorded at 15, 292 metric tons in 2025, down 3. 24 percent year-on-year. MACFL recorded capacity utilization of 77. 7 percent in 2025 which culminated into production of 11, 508 metric tons of BOPP and 5594 metric tons of CPP. This was against the capacity utilization of 80 percent registered in 2024. Cost of sales heightened by 13 percent in 2025 due to elevated energy prices, inflationary pressure and higher fixed cost per unit due to comparatively lower capacity utilization. Gross profit descended by 25. 43 percent in 2025 with GP margin ticking down to 11. 52 percent. Administrative expense surged by 22. 39 percent in 2025 due to expansion in workforce from 214 employees in 2024 to 240 employees in 2025. This was because the company is continually targeting new markets to diversify its sales mix and sustain its volumes. Marketing expense also ticked up by 12. 21 percent in 2025 due to higher freight and SAP services charges incurred during the year. Lower provisioning done for WWF and WPPF was the primary cause of 10. 51 percent dip in other expense in 2025. Other income also tamed down by 25. 96 percent in 2025 due to no exchange gain recorded on account of stability in the value of local currency lately. Profit from bank accounts also receded during the year due to monetary easing. Moreover, greater loss incurred on the sale of operating fixed assets also squeezed other income in 2025. Operating profit thinned down by 59. 33 percent in 2025 with OP margin ticking down to its lowest level of 3. 76 percent. Finance cost shrank by 18. 87 percent in 2025 due to monetary easing. External borrowings continued to mount during the year which resulted in a gearing ratio of 23. 81 percent in 2025 versus 11. 42 percent in 2024. Net profit plummeted by 66. 91 percent to clock in at Rs. 85. 28 million in 2025. This translated into EPS of Rs. 1. 44 and NP margin of 1. 42 percent in 2025. Recent Performance (9MFY26) During the nine-month period of the ongoing fiscal year, MACFL’s net sales grew by 10. 40 percent to clock in at Rs. 4937. 07 million. This was due to change in product mix, proactive inventory procurement and better production efficiency attained after completing plant maintenance in the previous year. Plant downtime in the comparative period also provides low-base effect, resulting in improved sales portrayed in 9MFY26. The company’s cost cutting measures and focus on high-margin value-added products resulted in 36. 68 percent stronger gross profit in 9MFY26 with GP margin clocking in at 14. 48 percent versus GP margin of 11. 69 percent recorded in 9MFY26. Better production and sales volume and increased operational activities pushed up administrative expense by 18. 56 percent and distribution expense by 22. 96 percent in 9MFY26. Increased profit related provisioning appears to be the cause of 271. 79 percent spike in other expense in 9MFY26. However, it was offset by 21. 46 percent stronger other income recorded during the period. This resulted in net other income of Rs. 75. 37 million, up 1. 50 percent year-on-year. Higher other income was the consequence of exchange gain and greater cash & bank balances recorded during the period. MACFL’s operating profit burgeoned by 60. 61 percent in 9MFY26 with OP margin clocking in at 5. 89 percent versus OP margin of 4 percent recorded in 9MFY25. The recent onset of monetary tightening coupled with increased external borrowings resulted in 48. 40 percent higher finance cost in 9MFY26. MACFL was able to record 56. 47 percent stronger bottomline to the tune of Rs. 113. 987 million in 9MFY26. This translated into EPS of Rs. 1. 92 and NP margin of 2. 31 percent in 9MFY26 versus EPS of Rs. 1. 23 and NP margin of 1. 63 percent registered in 9MFY25. Future Outlook MACFL is solidifying its position in the export markets which is evident from successful development of fully owned subsidiary overseas. This will not only strengthen MACFL’s sales revenue and margins by hedging against inflation and currency depreciation but the company will also be able to cut back on its freight cost as its export destinations will be nearer to its production site. The commencement of solar power plant at its manufacturing facility will also result in substantial cost savings. MACFL has also recently commissioned its advanced thermal extrusion coating machine. This has significantly enhanced the company’s value-added portfolio.

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