Beacon Impex (Pvt.) Limited ("the Company" or "Beacon Impex") was incorporated in Pakistan as a private limited company on December 2nd, 2005 under the Companies Ordinance 1984 (Repealed with the enactment of the Companies Act, 2017).

Beacon Impex (Pvt.) Limited was incorporated in 2005 as an IT service-providing corporation. and has developed itself into a growing vertically integrated unit by setting up conversion and doubling units in 2012 and eventually entered in the garment export business in 2018.

The principal business activity of the Company is the manufacturing and sale of garments and yarn, and the trading of textile products. The Company's operations are divided into five divisions: Yarn, Elastic, Fabric, Denim, and Apparel. Beacon Impex has established a strong presence in the dedicated bodywear industry for approximately one decade, and a production of ~5.67 million garments each month. The registered office of the Company is situated at P-102 Jail Road, Faisalabad. The Company’s energy requirement stands at 9.3MW, which is primarily met through solar capacity, FESCO, and RLNG.

The majority of the shareholding is vested with the Company's Chief Executive Officer, Mr. Muhammad Shakeel Faridi, and Director, Mr. Mudassar Zafar, along with other sponsoring shareholders. This concentrated ownership reflects strong sponsor backing and direct involvement of the top management in the strategic and operational direction of the Company.

The sponsors have a long-term association with the Company and the textile business. The next generation is also engaged in business (Mr. Muhammad Nazir Ahmed). A formal documented succession plan will augment the ownership framework of the Company.

Mr. Muhammad Nazir Ahmed is considered the man of the last mile. He has been associated with the Company for the last eight years where he is playing a pivotal role in driving organizational growth and operational excellence. His expertise lies in strategic management, supply chain optimization, and fostering innovation within the textile industry.

The financial strength of the Company primarily divests in a single line of business. The Sponsors of the Company are committed to supporting the Company in times of intricacy

Beacon Impex’s BoD consists of two members, both occupy executive roles, including the CEO, while Mr. Mudassar Zafar is designated as director. Both directors have more than 20 years of relevant experience and have been associated with the Company for the last 10 years. The inclusion of independent oversight will further improve the governance framework of the Company.

Mr. Shakeel Faridi holds a master's degree in computer sciences. The board members carry vast knowledge and extensive experiences in the textile industry. Mr. Mudassar Zafar has vast experience of more than 20 years in the textile industry and is associated with the Company since 2013.

Three committees: Audit Committee, HR Committee, and Risk Committee, are in place to assist the board in relevant matters and ensure proper oversight.

Kreston Hyder Bhimji & Co., who are listed as category “A” on the SBP’s panel of auditors, are external auditors of the Company. They have expressed an unqualified opinion on the financial statements of the Company for the year ended June 30, 2025.

The organizational structure of the Company is a well-organized, hierarchical system that ensures strong governance, clear accountability, and efficient operations. The Board of Directors exercises oversight through key committees, while the CEO maintains centralized leadership across strategic, operational, financial, and risk areas. The separation between the CSO, MD, and CFO ensures focused leadership in planning, execution, and financial management. Operational units under the MD are specialized by business areas like garments, knitting, and polyester, while support functions like Compliance, IT, and Supply Chain are integrated under the CSO. Overall, the structure promotes clarity and specialization, though maintaining inter-departmental coordination will be key as the organization grows.

The management team is headed by the CEO. He is supported by a team of seasoned professionals, who supplement his expertise. Mr. Khalid Mehmood, the CFO, holds a master’s in business administration and has extensive experience of over 11 years under his belt.

The management meetings are held periodically with the follow-up points to resolve or proactively address operational and administrative issues, if any, eventually ensuring a smooth flow of operations. The management is assisted by four committees: Business Development Committee, Corporate Social Responsibility Committee, Financial Management and Compliance Committee, and Operations Planning and Coordination Committee, ensuring strong effectiveness.

The Company has developed an in-house state-of-the-art integrated ERP system, which is designed in Oracle 6i, enabling it to efficiently monitor and control production, inventory, and quality levels.

Beacon Impex has built an automated and centrally integrated KPIs-based assessment dashboard system to analyze real-time facility performance and address process inefficiencies. The execution of RFID and barcodebased traceback systems has enabled the Company to access final product traceability via a single scan, which escalates the control environment. The Company has an in-house internal audit department with quarterly reporting frequency, and it is directly reportable to the audit committee.

Pakistan’s textile exports improved during FY25, supported by gradual normalization in global demand and easing domestic financial conditions. Sector exports increased to USD ~17.3bln in FY25 (FY24: USD 16.7bln), reflecting a recovery led primarily by value-added segments, including garments and home textiles, while the spinning segment continued to operate under a highly competitive and margin-sensitive environment. Despite the improvement in export volumes, the operating landscape remained structurally constrained by elevated energy tariffs and the full-year impact of the Normal Tax Regime (NTR), which has materially altered post-tax profitability for export-oriented units. The imposition of corporate income tax and super tax under NTR has continued to compress net margins, particularly for low- to mid-tier spinning entities with limited pricing power and scale efficiencies. However, the progressive decline in policy rates during FY25 provided partial relief to financing costs, improving cash-flow dynamics and offering some cushion to debt-servicing metrics across the sector. In parallel, energy efficiency initiatives, particularly solarization, have emerged as a key structural differentiator, enabling relatively stronger cost positioning and margin resilience for companies with early investments in renewable energy. At the global level, evolving trade policies, shifting tariff regimes, and ongoing realignment of supply chains are expected to reshape competitive dynamics within major textile markets, particularly Europe and North America. These developments introduce both risks and selective opportunities for Pakistani exporters. While heightened competition and regulatory compliance requirements may intensify pressure on conventional suppliers, efficient spinning units aligned with quality, traceability, and sustainability standards stand to benefit from supply-chain diversification and buyer risk rebalancing. Overall, industry conditions during FY25 reflected a gradual shift toward stabilization, with future performance increasingly dependent on product mix optimization, export orientation, energy efficiency, regulatory adaptability, and financial discipline.

Beacon Impex has established its footprints in the dedicated bodywear industry over a time of ~01 decade. The Company has production capacity of ~5.67 million garments per month. The relative position of the Company is considered strong in the dedicated bodywear segment.

During FY25, the Company’s revenue base witnessed a significant expansion and stood at PKR 52.6bln (FY24: PKR 36.3bln), reflecting strong growth primarily driven by improved product pricing in dollar terms and volumetric expansion in export markets. During 1HFY26, the Company recorded revenue of PKR 24.7bln (1HFY25: PKR 23.5bln), indicating continued growth momentum, albeit at a relatively moderate pace. The revenue base remains dominated by direct export sales of the bodywear segment, followed by yarn. Puma continues to be the Company’s top client, followed by Hugo Boss, Levi’s, and Amazon. Geographically, the revenue mix is led by Europe, followed by North America, Asia, and other regions.

During FY25, the Company’s profitability metrics experienced pressure, with gross margin declining to ~14.5% (FY24: 18.6%) and net margin to ~5.3% (FY24: 8.0%), primarily due to elevated raw material costs and higher finance charges. In 1HFY26, margins remained broadly stable at these levels, with gross margin at ~15.6% and net margin at ~4.8%. The continued margin compression reflects cost absorption of higher-priced inventory and elevated finance costs, with finance cost remaining a key drag on profitability.

The management remains focused on aligning operational performance with projected growth while continuing its strategic CAPEX cycle across the textile value chain. Over recent years, investments have been directed towards processing, garments, spinning, PET polyester, knitting, and elastic segments, supporting product diversification and vertical integration. Additionally, the Company has undertaken investments in renewable energy initiatives to mitigate energy cost risks. The operationalization of the polyester recycled fiber plant (PEICT) further strengthens the Company’s sustainability profile and positions it favorably in environmentally conscious export markets.

During 1HFY26, the Company’s working capital profile reflects some stretch, with net working capital days increasing to ~92 days (FY25: 63 days; FY24: 66 days). Similarly, gross working capital days rose to ~129 days (FY25: 100 days; FY24: 112 days), primarily due to relatively higher inventory and receivables levels. Inventory levels remain elevated to support export orders and ensure supply continuity. The Company continues to fund its working capital requirements through a mix of short-term borrowings and internally generated cash flows, reflecting ongoing reliance on bank lines.

During FY25, the Company’s FCFO remained largely stable at PKR 6.1bln (FY24: PKR 6.1bln), with interest coverage and debt coverage standing at 3.6x and 2.0x, respectively. During 1HFY26, coverage indicators depict a mixed trend, with EBITDA-based coverage improving to ~4.4x (FY25: 3.7x), reflecting stronger operating profitability. However, cash flow-based coverage remains relatively constrained, with FCFO-based coverage hovering around ~2.0x, indicating that debt servicing capacity, while adequate, remains sensitive to finance cost and working capital dynamics.

The Company maintains a leveraged capital structure, with gearing increasing to ~46.1% as of 1HFY26 (FY25: 44.1%, FY24: 42.1%). The debt mix continues to be skewed towards short-term borrowings, reflecting the working capital-intensive nature of operations. Short-term borrowings have increased in line with business expansion, while the equity base has continued to grow, reaching ~PKR 19.4bln as of Dec’25 (FY25: PKR 18.2bln), supported by profit retention. Notably, the Company’s average borrowing cost declined to ~12.1% (FY25: 17.6%), providing relief to the overall financing burden despite higher leverage levels.