KARACHI: Hub Power Company Limited (HUBC) reported consolidated profit of Rs10.6 billion for the second quarter of FY26, translating into earnings per share (EPS) of Rs8.19, up 152 percent year-on-year but down 9 percent on a sequential basis, with the result falling short of industry expectations due to a higher-than-anticipated effective tax rate.
The sharp year-on-year increase in earnings was primarily attributed to amendments in the company’s Power Purchase Agreement (PPA) implemented in 2QFY25, which improved base profitability. However, quarter-on-quarter decline in profit was mainly driven by a rise in the effective tax rate (ETR).
The company’s ETR stood at 23.8 percent in 2QFY26, compared to 38.7 percent in the same quarter last year and 19.3 percent in 1QFY26. Cumulatively, the effective tax rate for 1HFY26 was recorded at 21.6 percent, compared to 19.7 percent in the corresponding period last year.
For the first half of FY26, HUBC posted profit of Rs22.3 billion (EPS Rs17.2), reflecting a 5 percent year-on-year decline, largely due to the higher tax charge.
Gross profit increased 16 percent year-on-year to Rs7.4 billion in 2QFY26, mainly due to a lower base effect following the reversal of interest on overdue receivables after the PPA amendment in the previous year.
Profit from associates and joint ventures rose 7 percent year-on-year, supported by higher contributions from ThalNova and additional earnings from Mega Motors.
Finance costs declined 44 percent year-on-year and 8 percent quarter-on-quarter to Rs2.3 billion during the quarter, mainly due to lower interest rates and reduced debt levels.
On an unconsolidated basis, the company recorded dividend income of Rs7.8 billion in 2QFY26, largely from Hub Power Holding. Notably, ThalNova Power also declared a dividend after announcing its Project Completion Date (PCD) in October 2025.
Alongside the financial results, HUBC announced an interim cash dividend of Rs5 per share for 2QFY26, taking the total payout for 1HFY26 to Rs10 per share.
Copyright Business Recorder, 2026