National Foods Limited ('National Foods' or 'the Company') is a public listed company, incorporated in 1970. and converted to a public limited company in 1988.

In 1970, Mr. Abdul Majeed (late) and Mr. Waqar Hasan (late) founded National Foods by acquiring National Foods Laboratories, with the aim of introducing branded and packaged spices. In 1986, the company expanded by setting up its second production facility in SITE. A third facility was established in Port Qasim in 2006. In 2013. 

The Company is primarily engaged in manufacturing convenience food products with a portfolio of 11 categories in 280 different products. The production facilities are located in Port Qasim, Nooriabad, and M-3 Industrial City, Faisalabad. The Company is exporting products to ~ 40 countries across ~ 5 continents, through NF DMCC. During FY25, the Company’s production increased by 9.8% to 92,285MT (FY24: 84,046MT). 

The majority of the NFL’s ownership is held by its sponsors through the associate entity ATC Holdings (Pvt.) Limited, which owns approximately ~34.0%, while the company’s directors and their family members hold around 42.5%. The general public also owns a significant portion, with about 10.8% of the shares. The remaining ~13% is held by Foreign Companies, Modarabas, Mutual Funds and Insurance Companies. 

The Company’s capital structure remains highly stable, underpinned by a consistent majority stake held by the sponsoring family, ensuring long-term continuity in strategic direction.

The sponsoring family possesses substantial business acumen, rooted in extensive experience within the food sector. Their leadership is characterized by a disciplined approach to operational scaling and a proven ability to mitigate systemic risks through strategic foresight. Furthermore, the sponsors have demonstrated a consistent track record of resilient performance, maintaining adequate oversight of the entity's financial health while fostering long-standing relationships with key stakeholders and financial institutions.

National Foods Limited (NFL) maintains a robust financial profile, characterized by a significant capital base and substantial operational scale. As of FY25, the company’s consolidated equity stood at PKR 16.0 billion, supporting an expansive asset base of approximately PKR 45.5 billion. The Group’s successful diversification into various food segments has driven considerable top-line growth, with annual turnover reaching ~PKR 101.3 billion. This scale of operations is complemented by healthy bottom-line performance, evidenced by a Profit After Tax (PAT) of ~PKR 4.4 billion, reflecting the company’s ability to maintain profitability across its diverse business interests.

The Board of Directors consists of seven members, including two Non-Executive Directors, two Executive Directors, and two Independent Directors. The Board is primarily led by the sponsoring family. Additionally, the presence of independent directors strengthens the governance profile of the Company. The Board is constituted in compliance with the SECP Code of Corporate Governance and the listing requirements of the Pakistan Stock Exchange. 

Mr. Zahid Majeed serves as the Chairman of both ATC Holdings (Pvt.) Limited and National Foods Limited. Under his stewardship, the Company has evolved into a preeminent player within Pakistan's multi-category food sector. His leadership extends to the educational and ideological sectors, where he holds the positions of Chairman of the Nazaria-e-Pakistan Trust (Sindh) and Chancellor of the Textile Institute of Pakistan. Additionally, he contributes to sectoral academic governance as a member of the Board of Governors at the National Textile University, Faisalabad.

The Board operates through two formally constituted committees: the Audit Committee and the Human Resource and Remuneration Committee. The Audit Committee oversees financial reporting integrity, external audit engagement, and internal control oversight, while the HR&R Committee governs compensation and talent strategy. Board Minutes are formally documented.

The company demonstrates a commitment to high reporting standards, as evidenced by the engagement of KPMG Taseer Hadi & Co. as external auditors. The firm is a member of the State Bank of Pakistan’s (SBP) approved panel of auditors, ensuring compliance with rigorous regulatory benchmarks. For the period ended June 30, 2025, the auditors issued an unqualified opinion.

The Company's organizational structure reflects clear reporting lines across eight main departments: Pakistan Operations, International Operations, Finance, People and Corporate Reputation, Innovation Research and Development, Quality Assurance, Digital Data & Technology, and Legal Risk and Compliance.   Functional department heads report to the CEO, who reports to the Board. Head of Internal Audit and HR maintains dual reporting lines, functionally to the respective Board committees and administratively to the CEO.

Mr. Abrar Hasan is the Global CEO of National Foods Limited (NFL) and has maintained a seat on the Board of Directors since 2000. He oversees the Group’s extensive international footprint, serving as a Director for several key subsidiaries, including National Foods DMCC (NFDMCC), National Foods Pakistan UK Ltd., and National Epicure Inc. Canada (NEI). His governance role further extends to A-1 Bags & Supplies Inc. Canada, a subsidiary of NEI.

Management effectiveness is reinforced through a Management Committee that meets periodically to monitor operational and financial performance. Minutes of these meetings are formally documented.

The Company has transitioned to SAP S/4 HANA, a state-of-the-art ERP platform which enhances management information quality, operational integration, and decision-support capability. This investment in management systems is viewed positively.

The Company maintains a stringent compliance framework, underscored by an extensive suite of international certifications including ISO 9001 (Quality Management), ISO 22000 (Food Safety), ISO 45001 (Health & Safety), and ISO 14001 (Environmental Management). Adherence to global benchmarks is further validated by BRC, SEDEX, and Halal certifications, reflecting a comprehensive commitment to product integrity and ethical supply chain practices. Operational governance is reinforced by a robust internal audit function, co-sourced with EY Ford Rhodes. This strategic partnership strengthens the Company’s risk management and control environment while driving continuous process optimization through the institutionalization of standardized operating procedures (SOPs). Furthermore, the integration of SAP ensures data-driven management and operational transparency, aligning the business with the highest industry standards for compliance and efficiency.

In Pakistan, the domestic convenience food market is growing, with a 4.2% CAGR forecast for 2025-2033.Distribution meets international standards in cities, but expansion opportunities exist in smaller areas. Retail is fragmented; however, large chains are emerging, potentially changing consumer habits. The CPI’s year-on-year increase is 4.5% as of FY2024-25, signaling a slowdown in inflation. This impacts consumer spending,especially on convenience foods, as price hikes in essentials continue. Companies must adapt to these economicshifts to maintain market share. The Condiments category in Urban and Rural inflation levels contributed~9.6% and ~9.2%, respectively, as of 5MFY25.

National Foods Limited (NFL) maintains a dominant market presence as a category leader across several key consumer segments, including recipe mixes, spices, condiments (ketchups and pickles), salt, and jellies. This leadership is underpinned by high brand equity and deep-seated customer loyalty, which serve as significant entry barriers for competitors. In the dessert category, the Company holds a preeminent position, consistently capturing the largest market share through a well-established brand footprint. While the condiments segment is characterized by a high degree of fragmentation and a heavy presence of unorganized players, the NFL stands out as a leading force within the organized sector.

The Company has sustained a consistent growth trajectory, successfully scaling its operations and market reach. The revenue base is well-diversified across six core product categories: Recipe Mixes, Ketchups, Pickles, Salt, Desserts, and Spices & Ingredients. Notably, the Recipe Mixes segment remains the primary driver of turnover, underpinning the Group’s top-line performance. The Company’s extensive portfolio comprises over 280 SKUs, primarily serving a robust domestic market. Complementing its local dominance, the Company has established a significant global footprint, exporting to 40 countries across five continents. During the current period, the UAE and Afghanistan continue to serve as the principal export destinations, highlighting the Company's established presence in key regional markets. During FY25, the Company's sales base clocked at PKR 44,587mln (FY24: PKR 37,377mln), reflecting a YoY growth of ~19.3%, driven by price adjustment and increased sales volume.   During 2QFY26, the Company's revenue stood at PKR 22,020mln.  

The Company’s cost structure and profitability improved notably in Jun’25, supported by stronger margins and lower financing costs. Gross Profit Margin increased to 35.5% (Jun’24: 31.7%), This improvement was driven by disciplined procurement and reduction in fuel expenses. This translated into a higher Operating Profit Margin of 10.9% (Jun’24: 7.6%). Consequently, Net Profit Margin strengthened to 7.1% (Jun’24: 3.4%), with Net Income rising to PKR 3,181mln (Jun’24: PKR 1,269mln) on a YoY basis. The improvement in profitability was further supported by a decline in Finance Cost to PKR 1,263mln (Jun’24: PKR 1,568mln), leading to a reduction in the Finance Cost to Sales ratio to 2.8% (Jun’24: 4.1%).  At end-Dec'25, the Company's gross margin and net margin stood at ~38.5% and ~11.5%, respectively as the net income during the period clocked at PKR 2,535mln.

National Food Limited’s (NFL) strategic maneuvers reflect a forward-thinking approach that aligns with long-term financial stability and growth.  The Faisalabad facility — commissioned in 2024 — is NFL's largest and most advanced plant, offering a monthly production capacity of 6,000 tons across a diverse category range, and is expected to be a meaningful driver of medium-term capacity utilisation and margin improvement as operational efficiencies mature. During FY25, the international business has grown to represent over 50% of consolidated group revenue. Realigning the investment footprint, the Company executed the divestment of approximately ~50.5% of its shareholding in A-1 Cash & Carry (A-1), a Canadian grocery retail chain acquired in 2017.

The Company’s working capital requirements are a function of its inventory, trade receivables, and trade payables, which are financed through internal cash generation and short-term borrowings. In FY25, the average inventory days significantly improved, reducing to 62 days in FY25 from 89 days in FY24, indicating efficient inventory management and optimized stock levels. Receivable days also reflected a marginal improvement to 13 days (FY24: 14days). This led to improved Gross working capital days at 75 days (FY24: 103days). Trade payable days stood at  15days (FY24: 21days). The Company's net working capital days stood at 59days, witnessed an improvement from 82days in FY24. During 2QFY26, the Company's net working capital days stood at 68days. 

NFL’s coverages are a function of free cash flows and finance costs incurred. FCFO stood at ~PKR 5,277mln in FY25 (FY24: ~PKR 5,277mln, 2QFY26: 3,425mln). Finance cost also showed signs of decline, standing at PKR 1,263mln (FY24: PKR 1,568mln, 2QFY26: PKR 464mln) on the back of downward trajectory of interest rates. Subsequently, the interest coverage ratio significantly improved to 4.3x (FY24: 2.1x, 2QFY26: 7.6x), as well as the debt coverage ratio (FY25: 3.0x, FY24: 2.0x, 2QFY26: 3.7x). Overall, the Company's enhanced coverages improved the Company's financial risk profile. 

NFL has a highly leveraged capital structure with a debt-to-equity ratio of ~49.5% (FY24: ~55.2%). In FY25, total debt stood at ~PKR 8,356mln (FY24: ~PKR 9,338mln), witnessing a decline in the overall debt profile.  During FY25, the Company's equity base clocked at PKR 8,511mln (FY24: PKR 7,594mln). During 2QFY26, the Company's leverage stood at ~64.9%.