M.Y. Bari Mills (Pvt.) Limited (Bari Mills` or 'the Company') was incorporated in 2012 as a Private Limited Company.

Bari family is in textile industry for more than 6 decades. Previously, the family was only involved in trading of yarn. However, with passage of time the family increased its business and started production of towel.

Primary business of the Company is to manufacture and export towels. It exports its products to leading retailers, hospitality and healthcare industries across the world, primarily to USA, Germany, Norway and Sweden. Bari Mills has an integrated and modern setup including, weaving, and finishing, all under one roof. The Company has safely found its niche in the textile world with the addition of extensive new machinery in its wing, including Jacquard and Airjet looms, processing range and automatic stitching. Bari Mills has a capacity of ~190 looms, including high speed air-jet ~72 looms, semi auto ~70 looms, jacquard and dobby ~48 looms.

Bari Mills is a family-owned enterprise under the control of the Bari family. The principal stakeholder, Mr. Haroon Bari, holds ~20% of the Company’s shares. The remaining ~16% ownership is evenly distributed among his five sons.

Although no formal succession plan currently exists at Bari Mills, ownership and management responsibilities are equally divided among the five sons of Mr. Haroon Bari. To safeguard the Company’s long-term stability and operational continuity, management should consider the establishment of a group holding Company or the implementation of a comprehensive, documented succession plan. Such measures would help ensure structured leadership transitions, minimize internal conflicts, and promote sustainable growth.

The Bari family has maintained a longstanding presence in the textile industry, spanning several decades. The consistent growth and expansion of Bari Mills over the years is a testament to the strong business acumen and strategic foresight of its founding sponsors.

As of May 2025, the group has achieved consolidated revenues of  PKR 15.76bn, positioning it among the leading towel exporters in the country. The sponsors possess substantial financial strength and have consistently demonstrated their willingness to provide support to the Company when required, underscoring their long-term commitment to its stability and growth.

The Board of Directors at Bari Mills currently consists of six members, all of whom are representatives of the Bari family. The board is chaired by Mr. Haroon Bari, reflecting the family’s strong leadership presence within the organization. To enhance corporate governance practices, there is an opportunity to strengthen the board’s effectiveness by expanding its membership and introducing independent directors. Diversifying board composition can bring in broader perspectives, improve oversight, and align the Company with best practices in governance and accountability.

Mr. Haroon Bari, serving as the Chairman of the Company, brings with him over ~52 years of extensive experience, offering invaluable guidance to the Board of Directors when required. His five sons—Mr. Nabeel Bari, Mr. Adeel Bari, Mr. Osama Bari, Mr. Mustafa Bari, and Mr. Waqas Bari—each hold positions as Directors on the board. Collectively, they have been associated with the Company for a considerable period, reflecting continuity in leadership and a deep-rooted understanding of the business.

The Board of Directors at Bari Mills has constituted three committees: the Audit Committee, the Human Resources and Remuneration Committee, and the Board Management Committee. Despite the existence of these governance structures, the board’s effectiveness is limited due to its composition being entirely drawn from the sponsoring family, which restricts diversity and independent oversight. Board meetings are held on a scheduled basis to address routine matters, with additional meetings convened on an as-needed basis. However, the absence of a formal policy for recording board minutes compromises the transparency and traceability of board decisions. Strengthening governance through the inclusion of independent directors and the adoption of structured documentation practices could enhance the board’s overall performance.

Parker Russell- A.J.S Chartered Accountants. is the external auditor of the Company. The auditor has given an unqualified opinion on the financial statements for year ended June 30th, 2024. The firm is QCR rated by ICAP and is classified in category 'B' in the panel of auditors maintained by SBP. The board has formed three committees, namely i) Audit Committee (BAC), ii) Human Resources and Remuneration Committee (HR&RC), and iii) Board Management Committee (BMC). However, the effectiveness of the board is being compromised as it is dominated by the sponsoring family. Meetings are held on scheduled basis on the routine matters. Additionally meetings are convened on “as and when required basis”. There is no formal policy of recording board minutes.

The Chairman, along with his five sons, is actively involved in the day-to-day operations of the Company. The organization operates through a functional management structure, characterized by clearly defined departmental responsibilities and reporting lines. The management team is led by Mr. Nabeel Haroon Bari, who serves as the Chief Executive Officer (CEO). All directors report directly to the CEO, ensuring centralized leadership and streamlined decision-making.

Mr. Nabeel Haroon Bari, Chief Executive Officer (CEO), holds a degree in Commerce from the United Kingdom and possesses approximately 24 years of professional experience with the Company. Mr. Osama Haroon Bari serves as the Director Finance, responsible for overseeing the financial affairs and strategic fiscal planning of the Company. Mr. Mustafa Haroon Bari and Mr. Waqas Haroon Bari both hold the positions of Marketing Directors, managing brand positioning, market development, and customer engagement efforts. Mr. Adeel Haroon Bari serves as the Director Admin and Compliance, where he is responsible for ensuring adherence to regulatory standards, internal controls, and efficient administrative operations.

The Company operates under an informal framework of management committees, which are convened at the discretion of the leadership to facilitate coordination across departments. These meetings are attended by the respective departmental heads and are held on bases of operational requirements. However, the overall effectiveness of management oversight and collaboration could be significantly enhanced through the establishment of a formal management committee structure, incorporating clearly defined mandates, regular meeting schedules, and documented outcomes. Implementing such a framework would contribute to more consistent decision-making, accountability, and operational alignment.

Bari Mills currently operates on a .NET-based ERP system and has implemented an upgraded version—ASP-based ERP—which became operational on July 1, 2024. The Company’s Management Information System (MIS) is organized based on reporting frequency, comprising daily, weekly, and monthly reports. These MIS reports are routinely submitted to senior management, providing insights into the Company’s liquidity position and profitability profile, thereby supporting informed decision-making and strategic planning.

Bari Mills is accredited with various International certifications. The Company holds certifications for its products and facilities and is periodically audited by internationally recognized certification bodies including Oeko Tex 100 Class-I and Class-II, BSCI, C-TPAT, Sedex, GOTS, BRC.

During 11MFY25, the country’s total textile exports reached USD 16.4bln, reflecting a moderate growth of ~7% compared to the same period last year. Towel exports contributed around 6% of the total textile exports, amounting to USD 994mln, with a marginal growth of 3% only. Export volumes registered a modest increase of 2%, while the average unit price remained stable at ~USD 4.7 per unit. The local textile industry’s margins came under pressure due to new fiscal measures and a significant rise in energy tariffs. In Pakistan, there are ~10,000 towel looms, including shuttle and shuttle-less looms operating in both organized and unorganized segments of the towel manufacturing sector. The towel sector is predominantly export-oriented. The top 5 exporters consist of China, India, Pakistan Turkey, and Vietnam and together they account for approximately ~80% of the total export market.

Bari Mills holds a notable position within Pakistan’s towel export industry, accounting for  ~7% of the country's total towel exports. In comparison, Feroze 1888 is recognized as the market leader, commanding a significantly larger share of around ~27%, underscoring its dominant position in the sector.

Bari Mills derives the majority of its revenue from the manufacture and export of towels, which constitutes the Company’s core business segment. The Company’s business model is heavily export-oriented, with a significant portion of sales generated from international markets. The United States is the Company’s largest export destination, accounting for the bulk of its foreign sales, followed by European countries, which also represent a substantial share of the customer base. This international exposure reflects the Company’s competitive positioning in global markets and its ability to meet export standards in terms of quality, volume, and compliance. It also suggests that Bari Mills is strategically aligned with global demand trends, particularly in the home textile segment. During IHFY25 Bari Mills recorded a topline revenue of PKR 5,989mln, a notable improvement compared to PKR 4,185mln in FY24. This represents a year-on-year increase of around ~43%, indicating strong growth momentum. The surge in revenue is attributed to higher export volumes, favorable market conditions and expanded customer base in review period. The Company’s consistent revenue performance in the export market reinforces its standing as one of Pakistan’s key players in towel manufacturing, supporting both its financial stability and strategic growth prospects.

During IHFY25, Bari Mills reported a gross margin of ~14%, which reflects a slight contraction from the ~15% recorded in FY24. Despite the minor decline in gross profitability, the Company maintained a stable cost structure relative to revenue. The operating margin for the period stood ~7%, compared to ~8% in FY24, suggesting modest pressure on operational efficiency or higher overhead costs during the period. Notably, the net profit margin improved to around ~5% in IHFY25, up from ~2% in FY23, indicating an enhancement in bottom-line performance, driven by foreign exchange gain in review period. This margin profile reflects resilient operational fundamentals, with opportunities to further optimize profitability through cost efficiencies and strategic pricing initiatives.

As an export-oriented enterprise, Bari Mills has experienced a notable upward trend in demand from its key international markets, particularly the United States and Europe, in recent years. This consistent growth reflects the Company’s strong positioning in global textile supply chains and its ability to meet the evolving expectations of international buyers in terms of quality, reliability, and compliance. Looking ahead, the demand and sales for the Company’s products are expected to continue on a growth trajectory, supported by favorable market dynamics, strategic customer relationships, and an expanding global footprint. This positive outlook underscores Bari Mills’ potential for sustained revenue expansion and enhanced market share within the international towel industry.

During IHFY25, gross working capital days of the Company reached to ~86 days (FY24: ~73 days). However, working capital days of the Company are in line with the industry average. Moreover, the Company had a short-term total leverage of ~0.8% (FY24: -0.3%).

During IHFY25, the Company’s free cashflows reached to PKR ~589mln (FY24: PKR ~977mln). The finance cost declined to PKR ~141mln, down from PKR ~287mln in FY24. Despite a reduction in earnings before interest and taxes (EBIT), the interest coverage ratio remained strong at ~4.6x, compared to ~6.8x in FY24, reflecting the Company’s continued ability to comfortably meet its debt servicing obligations.

As on IHFY25, Bari Mills maintained a moderately leveraged capital structure, with a leverage ratio of ~36%, consistent with the FY24. Notably, 100% of the Company’s debt portfolio is financed through the State Bank of Pakistan’s (SBP) concessionary schemes, enabling access to low-cost funding and supporting liquidity. Looking ahead, the Company has outlined some expansion plans, which may alter the current leverage profile. These developments will require strategic financial planning to maintain a prudent debt-equity balance and preserve financial resilience in a growing operational environment.