US Apparel & Textiles (Private) Limited ('US Apparel' or "the Company") was incorporated on February 18, 1987, as a private limited company and registered under the Companies Ordinance, 1984 (Repealed with the enactment of the Companies Act, 2017).

US Apparel & Textiles (Private) Limited is the flagship business venture of the US (Umer-Siddique) Group ("the Group").

US Apparel is principally engaged in the manufacturing and export of ready-made garments. The Company has five production units. Unit 1 is located in Gulberg-III, and Unit 1R is in Sundar Industrial Estate. Units 2 & 5 are located Off Defence/ Raiwind Road, and Units 3 & 4 are located on Ferozepur Road, Glaxo Town, Lahore. The registered office of the Company is situated at 3-KM, OFF Defence/Raiwind Road Lahore.

The Company is a wholly-owned subsidiary of AJ Holdings (Private) Limited; a prominent business venture of two sponsoring families (Mr. Mian Muhammad Ahsan & Mr. Javed Arshad Bhatti) of the US (Umer-Siddique) Group. The sponsors exercise their control over the Company’s board by virtue of its 100% stake in the Company.

The Group's ownership is divided between the two sponsoring families; Javed Arshad Bhatti and Mian Muhammad Ahsan. The Group’s holding company, AJ Holdings (Private) Limited, primarily manages investments in subsidiaries and associated companies, which bodes well for the stability of the overall structure.

US Group is one of the oldest business conglomerates in Pakistan with considerable interest in textiles. The Group has developed commendable expertise in the textile garments sector, over the years, and enjoys long-term association with several customers abroad. The Group’s presence has been limited to the textile sector but sustained volatility effectively over the years. Apart from the garment business, US Group also has a denim weaving mill namely, US Denim Mills Limited, involved in weaving. This has assisted the Company in expanding its operations despite challenging market dynamics.

The presence of the holding company and details of a business profile and operations of almost all group companies reflect the strong financial strength of sponsors. This indicates sponsors’ ability and willingness to support the flagship company of the Group in case of need.

The Company has a ten-member board with the presence of sponsors and their families. The inclusion of an independent director will strengthen the governance framework of the Company.

The board members possess significant business stature, with a proven track record of operations within the local textile industry. The sponsors bring a wealth of knowledge, backed by more than three decades of extensive experience, which has equipped them to navigate and thrive in a volatile market.

The board meetings are held regularly in which discussion on various aspects is also formally documented in minutes.

EY Ford Rhodes Chartered Accountants, who are in the category ‘A’ of SBP and have a QCR rating by ICAP, are the external auditors of the company. They have expressed an unqualified opinion on the financial statements of the Company for the year ending June 30th, 2024.

US Apparel is further divided into sub-business units (SBUs). The sBU-USA and sBU-UK/EU collectively operate five garment manufacturing units with a combined annual production capacity of 30mln units. Specifically, Manufacturing Unit 2 and Unit 5 fall under sBU-USA, while Units 1-R, 3, and 4 fall under sBU-UK/EU. The third SBU, US Denim Mills, is a fabric mill with an annual production capacity of 40mln meters of fabric. Each SBU is organized into the following functional departments: (i) Finance & IT, (ii) Marketing, (iii) Production, (iv) Supply Chain and Corporate Sourcing, and (v) Admin & HR. All departments report to their respective Managing Directors (MDs), who are responsible for delivering the bottom line and agreed goals and targets of their respective SBUs. The MDs, along with the CFO, Director Projects, Director HR, and Director IR, report to the CEO Designate.

Mr. Hafiz Mustanser, the CEO designate, brings over two decades of professional experience and holds an MBA. He has been associated with the group since 1998.

The management meetings are held periodically, chaired by the CEO, are conducted to proactively identify, address, and resolve operational issues, with designated follow-up points ensuring continuity and a smooth flow of operations.

The Company’s daily and monthly MIS comprises comprehensive performance reports which are reviewed frequently by senior management. Recognizing the need for quality information systems to control and maintain the efficiency of operations, the Company has implemented an Oracle-based ERP solution – Oracle E-business suite – version 12.1.3, (for Financial Reporting, Inventory, and Procurement from Head Office), Harmony version 4. The MIS reports are updated on a real-time basis to be available to senior management all the time. The reports are shared and discussed with the CEO regularly to ensure timely decision-making and a smooth flow of operations.

US Apparel utilize management systems as their mechanism for ensuring control. There is clear evidence of these systems being audited and certified externally. The Company has attained ISO 14001, 45001, 9001 SA8000, WRAP, Sedex, ISO 9001, OekoTex, GRS, RCS, OCS, SLCP light, STEP, CR 360, Higg FEM 3.0, and GOTS certification.

During MY25, approximately 24.4mln MT of cotton was produced globally, compared to about 24.2 million MT in MY24. Throughout the year, low cotton production was observed in India and Pakistan. However, this was partly offset by increases in cotton production in China, the United States, and Brazil by roughly 9.7%, 19.4%, and 15.7%, respectively. The sector's rising dependence on imported cotton poses a supply-side risk. During the FY25, imports accounted for approximately 35% of the cotton supply (~11% in FY24), adding about USD 1.27bln (USD 448mln in FY24) to the country's import bill. 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.

In Pakistan's denim sector, US Apparel is one of the top exporters. US Apparel & Textiles (Private) Limited is recognized as one of Pakistan's leading textile exporters, ranking 10th among the top 100 textile exporters in the country.

As per management representation, the Company witnessed a notable improvement in its top line during FY25, with revenue reaching PKR 71.3bln (FY24: PKR 61.2bln), reflecting a significant year-on-year growth of 16.5%. During the year, the Company sold 28.4mln pieces. Exports remained the dominant contributor to the revenue base, accounting for 98.7%, while the local market contributed the remaining 1.2%. In line with revenue growth, gross profit also improved to PKR 13.5bln (FY24: PKR 11.7bln). However, net profitability recorded a downward trend, reaching PKR 3.3bln (FY24: PKR 4.7bln).

Despite strong topline growth, the Company's margins experienced a degree of compression in FY25. The gross profit margin moderated to 18.9% (FY24: 19.2%), primarily reflecting upward revisions in the minimum wage rate, elevated raw material costs, and rising inflation across the cost base. These pressures cascaded through the P&L, compressing the operating profit margin to 9.8% (FY24: 12.2%). Consequently, net profitability declined to PKR 3.3bln (FY24: PKR 4.7bln), with the net profit margin moderating to 4.6% (FY24: 7.6%).

During the year, the Company enhanced its production capacity by 15,000 pieces per day, a development that is expected to augment the revenue base and further strengthen its overall business profile. In addition, the Company has established US Workwear as an independently operating business unit, purpose-built to serve the specialized and high-barrier workwear market. This vertical has been conceived and structured as a distinct commercial proposition, separate from mainstream apparel operations, catering to the niche yet fast-growing global demand for technically specified, compliance-driven occupational and protective garments. These strategic initiatives reflect the Company's continued focus on capacity augmentation and business diversification, positioning it favorably for sustained growth.

In FY25, the Company’s net working capital cycle remained stable at 40 days, consistent with FY24. The marginal increase in inventory days to 52 days (FY24: 49 days) reflects higher stock levels maintained during the period. Conversely, trade receivable days improved to 25 days (FY24: 26 days), indicating better collection efficiency. The net trade assets recorded a 14.5% increase, reaching PKR 11.3bln (FY24: PKR 9.8bln), indicating a healthy cushion in trade assets.

In FY25, Free Cash Flows from Operations (FCFO) recorded a decline, reaching PKR 5.6bln as compared to PKR 6.6bln in FY24, primarily driven by a decrease in EBITDA. The Company's lease liability stood at PKR 60mln in FY25, slightly up from PKR 52mln in FY24. Notably, in the absence of any borrowings, the Company's coverage indicators remain robust, reflecting a sound financial position.

US Apparel maintains a strong financial structure, underpinned by a robust equity base of PKR 18.5bln, reflecting a healthy increase from PKR 16.6bln recorded in the previous fiscal year. The Company has no short-term borrowings and has secured an interest-free loan from its holding company to support its net working capital requirements. The Company has only availed non-funded credit facilities from banks for trade purposes.