Bestway Cement Limited ("Bestway Cement" or "the Company"), the flagship cement manufacturing company of the Bestway Group, is a public limited company incorporated in Pakistan. The Company was listed on the Pakistan Stock Exchange (PSX) on April 9, 2001. Its registered head office is located at Bestway Building, 19-A, College Road, F-7 Markaz, Islamabad, while its sales office is situated in Rawalpindi. Bestway Cement is a subsidiary of Bestway International Holdings Limited (BIHL), which is wholly owned by Bestway Group Limited (BGL), Guernsey.

Bestway Cement was incorporated in 1993 and commenced commercial operations in 1998 with its first production facility at Hattar. Since its inception, the Company has pursued a growth strategy based on both greenfield investments and strategic acquisitions, enabling it to establish a dominant position in Pakistan's cement industry. Major acquisitions include Mustehkam Cement (Farooqia Plant) in 2005 and Lafarge Pakistan Cement (Kallar Kahar Plant) in 2015. In September 2016, following approval by the Islamabad High Court, Pakcem Limited, an 88%-owned subsidiary, was amalgamated into Bestway Cement, resulting in complete operational integration. More recently, the Company commissioned its fifth production facility at Mianwali, further expanding its production footprint and reinforcing its position as one of the lowest-cost cement producers in the country. Bestway Cement ranks as the largest cement manufacturer in Pakistan by installed production capacity, supported by operational efficiency, prudent financial management, and continued investment in sustainability and renewable energy initiatives.

The principal business activity of Bestway Cement Limited is the manufacturing, marketing, and sale of cement and clinker. The Company operates eight production lines across five integrated manufacturing facilities located at Hattar, Farooqia, Chakwal, Kallar Kahar, and Mianwali. With a total installed cement production capacity of 15.3 million tonnes per annum (based on 300 operating days), the Company is the largest cement manufacturer in Pakistan by installed production capacity. The Company's product portfolio comprises Ordinary Portland Cement (OPC), Pakcem Cement, Sulphate Resistant Cement (SRC), Quick Setting Cement, Low Alkali OPC, and Clinker, catering to diverse construction and infrastructure requirements. The Company markets its products through an extensive nationwide distribution network comprising distributors, dealers, and retailers, while also maintaining an export presence in regional and international markets. Operationally, Bestway Cement continues to leverage its geographically diversified manufacturing footprint, modern production facilities, and efficient logistics network to maintain its leadership position in the domestic cement industry and effectively serve demand across key markets.

Bestway Cement Limited is a subsidiary of Bestway International Holdings Limited (BIHL), which is wholly owned by Bestway Group Limited (BGL), both incorporated in Guernsey. Bestway International Holdings Limited holds 56.43% of the Company’s shares, while the Bestway Group and associated parties collectively hold 72.68%, underscoring strong sponsor backing. The remaining shareholding is diversified among financial institutions, insurance companies, mutual funds, corporate entities, and the general public. The ownership structure ensures effective strategic oversight while aligning the interests of the sponsors with the Company's long-term growth objectives.

The ownership structure has remained stable over the years, with no material changes in the controlling shareholding or sponsor composition. The Company continues to operate under the strategic direction of Bestway Group, which has consistently demonstrated its long-term commitment to the business through continued investments and capacity expansion. Furthermore, there are no announced plans relating to corporate restructuring, divestment of core operations, or discontinuation of any business segment. Accordingly, the ownership profile is expected to remain stable over the foreseeable future.

The sponsors possess extensive business experience and a proven track record of successfully operating diversified businesses across multiple economic cycles. Bestway Group is a leading multinational conglomerate with significant operations in both the United Kingdom and Pakistan. Over the years, the Group has developed a diversified portfolio comprising cement manufacturing, commercial banking, wholesale and retail, pharmacy, healthcare, and real estate. Within the cement sector, the Group has consistently demonstrated strong execution capabilities through strategic acquisitions, timely capacity expansions, operational excellence, and disciplined financial management. These attributes have enabled Bestway Cement to maintain its leadership position in Pakistan's cement industry. The sponsors' diversified business expertise, prudent investment philosophy, and long-term strategic orientation continue to provide considerable operational and managerial strength to the Company, enhancing its ability to navigate cyclical industry challenges while pursuing sustainable growth.

Bestway Group possesses a strong financial profile, underpinned by its diversified business portfolio spanning wholesale, healthcare, cement, banking, real estate, and investment businesses across the United Kingdom, Pakistan, and the Middle East. During FY2025, the Group reported annual turnover exceeding £5.24 billion, representing a 7% year-on-year increase, while profit before tax increased by 68% to £750.1 million. The Group's consolidated net assets strengthened to approximately £2.9 billion (FY24: £2.2 billion), reflecting robust capitalization and sustained profitability. The Group also maintains substantial operations through Pakistan's largest private bank (UBL), the UK's largest independent food wholesaler, the UK's second-largest retail pharmacy chain, and Pakistan's largest cement manufacturer. This diversified earnings base, coupled with strong cash generation and a prudent investment philosophy, provides significant financial flexibility and reinforces the sponsors' capacity to support Bestway Cement's strategic initiatives and future growth, if required.

The overall control of the Company rests with an eight-member Board of Directors, comprising two executive directors, including the Group Managing Director and Chief Executive, three non-executive directors, and three independent directors. The Board is chaired by Sir Mohammed Anwar Pervez, while executive management is represented by Lord Zameer M. Choudrey and Mr. Muhammad Irfan A. Sheikh. The Board composition complies with the Listed Companies (Code of Corporate Governance) Regulations, 2019, ensuring an appropriate balance between executive representation and independent oversight. The presence of experienced independent directors strengthens the Board's ability to exercise objective judgment and effective governance.

The Board comprises individuals possessing extensive experience across cement manufacturing, banking, finance, international business, corporate governance, and public administration. Their diverse professional backgrounds provide strategic direction and oversight over the Company's operations. Sir Mohammed Anwar Pervez, founder of Bestway Group, continues to serve as Chairman of Bestway Cement, providing continuity in strategic leadership. While Bestway Group underwent a leadership transition during FY25 with Lord Zameer M. Choudrey assuming the role of Group Chairman. Mr. Haider Choudrey succeeded as Group Chief Executive Officer on July, 01 2024. The governance structure of Bestway Cement, however, has remained unchanged, ensuring continuity in oversight and strategic direction. The Board's collective expertise continues to support prudent decision-making and long-term value creation.

The Board is supported by four specialized committees: Audit Committee, Human Resource & Remuneration Committee, Nomination Committee, and Risk Management Committee, each operating under clearly defined terms of reference. These committees strengthen governance by providing focused oversight over financial reporting, internal controls, succession planning, remuneration policies, and enterprise risk management. During FY26, the Audit Committee convened four meetings, with the external auditors participating in two meetings to discuss financial reporting and audit matters. The committee structure facilitates effective monitoring of key strategic and operational issues while enhancing accountability and the overall effectiveness of the Board.

The Company maintains a strong financial reporting framework supported by established internal control systems and an independent internal audit function. The external auditors, A. F. Ferguson & Co., Chartered Accountants, issued an unmodified (unqualified) audit opinion on the financial statements for the year ended 30 June 2026, confirming that the financial statements present a true and fair view in accordance with the applicable financial reporting framework. The auditors have also expressed satisfaction regarding the Company's compliance with the Listed Companies (Code of Corporate Governance) Regulations, reflecting sound financial transparency and governance practices.

Bestway Cement operates through a well-defined organizational structure comprising five principal functional areas: i) Administration, Marketing & Corporate Affairs; ii) Finance & IT; iii) Procurement, Planning & Coordination; iv) Works; and v) Sales. Each function is headed by an experienced executive and reports to the Group Managing Director, ensuring clear accountability and streamlined reporting lines. The organizational framework emphasizes decentralization of operational responsibilities while maintaining centralized strategic oversight, enabling timely decision-making and efficient execution across the Company's geographically diversified manufacturing operations.

The Company is led by Lord Zameer M. Choudrey, who serves as the Chief Executive, while Mr. Muhammad Irfan A. Sheikh continues as the Group Managing Director, overseeing the day-to-day operations of the Company. Although a leadership transition occurred at the Bestway Group level during FY25, the executive management structure of Bestway Cement remained unchanged. The finance function is headed by Mr. Muhammad Danish Khan, Chief Financial Officer, who is supported by an experienced management team possessing significant expertise across manufacturing, finance, engineering, procurement, and marketing. The continuity of the senior management team, coupled with extensive sector-specific experience, provides stability in strategic execution and operational management.

The Company follows a structured management framework supported by regular performance review and coordination mechanisms. Periodic management meetings involving senior executives and plant management facilitate close monitoring of operational performance, production efficiency, financial results, and strategic initiatives. The decision-making process remains centralized for strategic matters while operational authority is appropriately delegated across business functions, enabling prompt resolution of operational issues and effective coordination among manufacturing facilities.

Bestway Cement has implemented an integrated SAP-based Enterprise Resource Planning (ERP) platform, providing real-time visibility across finance, procurement, inventory management, production, sales, and logistics functions. The system is supported by a comprehensive Management Information System (MIS), which generates timely operational and financial reports for senior management, facilitating informed decision-making, performance monitoring, and effective internal control.

The Company maintains a robust control environment supported by standardized operating procedures, independent internal audit, and clearly defined authority levels across business functions. Operationally, its five manufacturing facilities are equipped with modern production technology and centralized process controls to ensure product quality, operational reliability, and regulatory compliance. To enhance energy reliability and optimize production costs, the Company utilizes a diversified energy mix comprising Waste Heat Recovery Power Plants (WHRPPs), boilers, solar power plants, grid electricity and gas-based generation. The continued investment in modern technology, process automation, and energy diversification strengthens operational resilience while supporting efficient plant operations.

Pakistan's cement industry demonstrated a gradual recovery during FY26, with total cement dispatches increasing by approximately 7.2% YoY to around 50.6 million MT, compared to 47.0 million MT in FY25. The recovery was primarily driven by a 9.5% increase in domestic dispatches to approximately 41.56 million MT, supported by lower interest rates during most of the financial year, easing inflation, and improving construction activity. Conversely, export dispatches remained under pressure, declining by around 2.1% YoY to 9.01 million MT, mainly due to subdued regional demand and the prolonged closure of the Afghan border, which particularly affected northern-based producers. Among the leading manufacturers, Lucky Cement retained the highest market share with dispatches of approximately 9.67 million tonnes, followed by Bestway Cement at around 7.04 million tonnes, while Fauji Cement and DG Khan Cement recorded dispatches of approximately 5.72 million tonnes and 5.49 million tonnes, respectively. Despite the improvement in dispatch volumes, industry capacity utilization remained moderate at nearly 60%, reflecting persistent excess production capacity across the sector. Going forward, demand is expected to remain supported by improving macroeconomic conditions, lower financing costs, public infrastructure spending, and a gradual recovery in private construction activity. However, elevated energy tariffs, inflationary pressures, geopolitical uncertainties, and intense price competition are likely to continue weighing on sector profitability, prompting manufacturers to maintain focus on cost optimization, alternative energy utilization, and operational efficiencies.

Bestway Cement Limited continues to maintain its position as Pakistan's largest cement manufacturers, with an installed cement production capacity of approximately 15.3 million MT per annum (based on 300 operating days). The Company's geographically diversified production footprint, comprising five integrated manufacturing facilities, provides a competitive advantage in serving the northern region while enhancing operational flexibility and supply chain efficiency. During FY26, the domestic cement industry witnessed a gradual recovery in dispatches, supported by easing inflation, lower interest rates, and improving construction activity. Leveraging its extensive distribution network, low-cost operations, and strong brand equity, the Company retained its position among the industry's leading players. Going forward, Bestway Cement's scale of operations, diversified manufacturing base, and efficient cost structure are expected to support its competitive positioning despite persistent industry overcapacity and pricing pressures.

During FY26, the Company's operational performance remained stable amid improving industry fundamentals. The sales mix continued to be predominantly driven by domestic dispatches, while exports constituted a relatively small proportion of total sales. Net turnover increased marginally to PKR 108.3bln (FY25: PKR 107.8bln), reflecting stable sales volumes and resilient pricing despite a competitive operating environment. Although higher production costs exerted pressure on operating profitability, the Company's diversified manufacturing footprint and disciplined pricing strategy supported revenue stability. Going forward, the gradual recovery in domestic cement demand, supported by lower financing costs and anticipated improvement in construction activity, is expected to provide further support to volumetric growth.

The Company's profitability remained healthy during FY26 despite rising production costs and continued competitive pressures. Gross profit margin moderated to approximately 30.0% (FY25: 34.6%) owing to higher fuel, energy, and operating costs, partially offset by prudent pricing and effective cost management initiatives. Consequently, operating profit declined by 17.1% YoY to PKR 26.51 billion, reflecting margin compression amid a challenging cost environment. Nevertheless, lower benchmark interest rates and reduced finance costs continued to support bottom-line performance. As a result, the Company reported a net profit of PKR 25.8 billion, translating into a net profit margin of approximately 23.8%, broadly in line with the preceding year. Bestway Cement's position as one of the industry's lowest-cost producers continues to provide resilience against competitive pricing pressures and cyclical fluctuations in input costs.

Bestway Cement continues to strengthen its long-term competitiveness through sustained investment in energy efficiency, environmental stewardship, and strategic diversification. The Company has established one of the largest renewable energy portfolios in Pakistan's cement sector, comprising 114.3 MW of installed solar capacity and 67.5 MW of Waste Heat Recovery Power Plants (WHRPPs). These initiatives enable major energy requirements to be met through renewable sources, while reducing costs, improving operational reliability, and contributing to a cumulative reduction of approximately 5.6 million tonnes of CO₂ emissions.

During FY26, the Company's working capital profile remained manageable, although working capital intensity increased. Gross working capital days rose to 31 days (FY25: 27 days), primarily due to higher inventory days, while net working capital days increased to 18 days (FY25: 16 days). Although payable days also increased by two days to 13 days, the increase was proportionately lower than the rise in inventory days, resulting in a longer cash conversion cycle. Consequently, the current ratio moderated to 0.8x (FY25: 1.1x). Short-term borrowings stood at approximately PKR 20.47 billion, reflecting continued reliance on short-term financing to support working capital requirements. Nevertheless, the Company's ability to generate positive operating cash flows, supported by established banking relationships and prudent working capital management, continues to provide adequate funding flexibility.

The Company's debt servicing capacity remained adequate during FY26, supported by a relatively lower finance cost environment. EBITDA stood at PKR 35.23 billion (FY25: PKR 38.73 billion), reflecting the impact of higher production and operating costs. Despite the moderation in EBITDA, EBITDA/finance cost coverage improved to 6.6x (FY25: 5.1x), supported by a significant decline in finance costs. FCFO stood at PKR 19.60 billion (FY25: PKR 27.51 billion), while net cash generated from operating activities amounted to PKR 24.16 billion, demonstrating continued positive operating cash flow generation. However, FCFO/finance cost + CMLTB + excess STB coverage moderated to 0.4x (FY25: 0.8x), while debt payback increased to 4.3x (FY25: 2.8x). The Company also reported net cash outflow of PKR 7.6 billion, primarily due to financing outflows of PKR 31.7 billion. Overall, the Company's adequate operating cash flow generation, lower finance cost environment and prudent treasury management continue to support its ability to meet financial obligations.

The Company's capitalization remained sound during FY26, with overall leverage improving on the back of lower total borrowings. Total borrowings declined to PKR 51.20 billion in June 2026 from PKR 58.06 billion in June 2025, primarily due to repayment of long-term borrowings. Shareholders' equity increased to PKR 133.87 billion (FY25: PKR 128.23 billion). Consequently, total borrowings-to-(total borrowings + shareholders' equity) improved to 27.7% (FY25: 31.2%), indicating a more conservative capital structure. Overall, the Company's capital structure remains conservative, underpinned by a stronger equity base, lower borrowings and adequate financial flexibility.