Crown Textile ("the Company") was incorporated as a Partnership Concern under the Partnership Act, 1932, and registered with the Federal Board of Revenue (FBR) on June 14, 2004, as an Association of Persons (AOP).

Crown Textile originated as a very small business and shipped its first export order in 2000. The Company's formative years were defined by slow and steady growth, during which it cultivated distinction in assembly line production and established robust systems for apparel manufacturing, laying the foundation for its current scale and market position. The registered office of the Company is situated at F-352/A, Sindh Industrial Trading Estate, Karachi.

The Company is engaged in the manufacturing and export of men's, ladies', and children's knitted garments. Crown Textile exported 12.98mln ready-made garments during 7MFY26, reflecting the strength of its fully export-oriented business model. The Company operates with a total of 101 knitting machines, capable of processing 40,000 to 45,000 kgs of knitted raw fabric per day, complemented by a dyeing capacity of 50,000 kgs of fabric per day.

The Company has a highly concentrated ownership structure, with 98% of the partnership interest held by Mr. Muhammad Nadeem, while the remaining 2% is owned by his spouse, Ms. Shaiza Nadeem.

The ownership structure of Crown Textile is expected to remain unchanged in the foreseeable future. However, the formalization of a family constitution and the implementation of a structured succession plan are viewed as important steps toward enhancing long-term ownership stability and strengthening the ownership framework.

Mr. Muhammad Nadeem possesses over three decades of experience in the textile industry, having developed substantial expertise across the full spectrum of apparel manufacturing and export operations. His hands-on leadership style and proven business acumen position him as a key driver of the Company's ability to navigate industry challenges and sustain long-term operational momentum.

In addition to the textile business, the sponsoring family maintains an established presence in the real estate sector, reflecting a diversified investment portfolio. The sponsors remain committed to providing financial support to the Company as and when required.

The governance structure of the Company, in line with its AOP legal framework, functions without a formal board, with the delegation of authority centralized entirely under the CEO. The establishment of a formal board would further strengthen the Company’s governance framework.

Mr. Muhammad Nadeem holds a Bachelor's degree in Commerce. He served as General Manager at M/S M.R. Industries from 1990 to 1995, followed by the establishment and operation of an independent subcontracting facility serving various exporters from 1995 to 2000. Building on this accumulated industry expertise, he founded M/S Crown Textile as an AOP in January 2000.

In the absence of a formal board, all operational decisions are subject to centralized control, with the CEO directly overseeing and managing all key activities of the Company.

SARWARS Chartered Accountants are the external auditors of the Company, which is listed on the State Bank of Pakistan (SBP) Panel of Auditors under category “C”. The firm issued an unqualified opinion on the Company’s financial statements for the year ended June 30, 2025.

The organizational structure of Crown Textile is divided into several functional departments, namely: (i) Finance & Commercial (F&C), (ii) Marketing, (iii) Technical, (iv) Production, (v) Information Technology, and (vi) HR, Admin and procurement functions. All departments report directly to the CEO.

The Company is led by a team of seasoned professionals with substantial institutional experience. Mr. Muhammad Kashif serves as the Chief Operating Officer (COO) and has been associated with Crown Textile for 24 years. Mr. Haseeb Munaf holds the position of Vice President with four years of tenure. Mr. Muhammad Saad serves as the Chief Financial Officer (CFO) and has been associated with Crown Textile since 2017.

The Company has no formal management committees. The sponsors assume an active execution role, reflecting an adequate delegation of authority matrix. Need-based management meetings are held to resolve or proactively address any operational issues, ensuring a smooth flow of operations.

Recognizing the need for quality information systems to control and maintain the efficiency of operations, Crown Textile has implemented an Oracle-based ERP solution – Oracle E business suite – version 6.1, (for Financial Reporting, Inventory, and Procurement from Head Office). The MIS reports are updated on a real-time basis to be available to the CEO all the time. The reports are shared and discussed with the CEO regularly to ensure timely decision-making and smooth flow of operations.

Crown Textile utilizes management systems as its mechanism for ensuring control. There is clear evidence of these systems being audited and certified externally. Examples of this include WRAP, BSCI, SLCP, C-TPAT, Higg FEM, OEKO TEX, GOTS – Global Organic Textile Standards, Made in Green – GRS & Better Cotton Index certifications. This both provides assurance and drives continual improvement.

Textile exports reached USD 17.9bln in FY25, a modest rise from USD 16.7bln the previous year, reflecting a 7.2% year-over-year growth. The largest contribution came from the composite and garments segment, at USD 14bln, which included the weaving segment at USD 1.8bln and the spinning segment at USD 0.7bln. The production of cotton cloth in FY25 declined by approximately 0.7% year over year, reaching around 877.1mln square meters. The renewable energy as input costs play a vital role in the cost dynamics. During FY25, about 25.3% of the cotton cloth produced was exported (compared to roughly 27.2% in FY24), with the rest used for the domestic market. The country's fabric exports fell by approximately 4.4% on YoY basis in FY25 (FY24: up about 5.8% on YoY basis), with approximately 23.4% of Pakistan's cotton cloth exports going to Bangladesh (compared to about 19.9% in FY24), followed by the USA with about 8.1% of cotton cloth exports (approximately 7.8% in FY24). The transition from the final tax regime to the normal tax regime is expected to affect the profitability of export-oriented units, with a 29% tax on profits and a super tax of up to 10%. Energy and finance costs are expected to stay within a range, given the projected reduction in interest rates and the absence of any major energy tariff increases. The textile & apparel sector recorded ~USD 3.21bln in exports in July August 2025, up ~10% year-on-year. The current trend is shifting from unstitched to ready-to-wear (Pret) collection. The US–Israel conflict with Iran has driven up oil prices and disrupted regional logistics, thereby affecting overall demand.

Crown Textile maintains a stable standalone position in Pakistan's knitted garments industry, while continuing to consolidate its standing as an emerging player within the sector.

In FY25, the Company's topline increased to PKR 12,077mln, reflecting a robust YOY growth of 32% (FY24: PKR 9,151mln; FY23: PKR 8,453mln) and a three-year average growth rate of 13.4%, underpinned by its fully export-oriented business model. Gross profit for the period stood at PKR 2,720mln. The Company's export markets span the United States, the United Kingdom, Ireland, Germany, Poland, Canada, and others, with the United States and Poland serving as its largest customer relationships, as the Company continues to prioritize expanding its global footprint through strategic market penetration.

Crown Textile maintained a stable gross profit margin of 22.6% in FY25 (FY24: 22.5%), reflecting consistent cost management across its integrated production operations. The operating margin improved marginally to 7.4% (FY24: 7.2%), supported by operating leverage on the higher revenue base. The net profit margin, however, compressed to 1.4% (FY24: 2.2%), driven primarily by a significantly elevated tax charge arising from the transition to the normal tax regime. Profit after tax for FY25 clocked at PKR 175mln (FY24: PKR 198mln).

The Landhi Dyeing Facility has been fully commissioned, marking a significant milestone in the Company's vertical integration and capacity expansion. The Company's strategic pivot into the home textile segment is viewed as a timely diversification move, with the second floor of the Landhi Factory earmarked for this purpose, machinery already imported, and the unit expected to be operational within six months. The Nooriabad Denim Factory remains on hold, while total installed solar capacity has reached 3.25MW, supporting cost optimization.

The Company primarily finances its working capital requirements through short-term borrowings. The net working capital cycle elongated to 83 days in FY25 (FY24: 72 days), driven by a surge in receivable days to 92 days (FY24: 79 days), partially offset by an improvement in inventory days to 83 days (FY24: 96 days). Trade receivables are managed on an open account basis, in line with standard export industry practice, wherein goods are dispatched and payment is received subsequently within agreed credit terms.

As of FY25, the Company’s free cash flow from operations stood at PKR 1,197mln (FY24: PKR 723mln), reflecting an improvement in cash generation capacity despite increased working capital investments. The EBITDA-to-finance-cost coverage ratio strengthened to 2.8x (FY24: 2.6x), supported by disciplined cost management and lower borrowing costs. FCFO to finance cost improved to 3.1x (FY24: 2.2x), and the debt payback period reduced significantly to 0.4 years (FY24: 1.4 years), reflecting strong cash generation capacity.

The Company's equity recorded a healthy increase to PKR 3,486mln in FY25 (FY24: PKR 2,938mln), composed entirely of unappropriated profits, with no share capital or revaluation reserves on record. Total borrowings of the Company increased sharply to PKR 3,836mln (FY24: PKR 1,984mln), primarily driven by a significant rise in short-term borrowings, which constitute 92% of total borrowings (FY24: 73%). Consequently, the leverage ratio increased to 52.4% (FY24: 40.3%), reflecting higher reliance on borrowed funds within the capital structure.