Flying Cement Company Limited ("the Company" or "Flying Cement") was incorporated in December 1992 as a Public Limited Company. The Company is listed on Pakistan Stock Exchange. Flying Cement is engaged in the manufacturing and sale of Ordinary Portland Cement.

Flying Cement Company Limited, previously known as Zaman Cement Company Limited, is part of the Flying Group, a diversified business conglomerate founded by Mr. Qamar uz Zaman Khan (father of  Mr. Kamran Khan and Mr. Momin Qamar). The group’s entrepreneurial journey began in the mid-1970s when Mr. Qamar uz Zaman Khan established Flying Coach, a luxury bus service operating between Lahore and Rawalpindi. At its peak, the fleet comprised around 300 imported coaches from Isuzu Motors, making the "Flying" brand well-recognized in the transportation sector. In addition, the family ventured into the hospitality business by establishing a well-known roadside restaurant in Kharian named Midway Hutch. 

Building on the popularity and trust associated with the "Flying" name, the family later diversified into the paper industry. They established Flying Paper Industries Limited in 1986, followed by Flying Board and Paper Products Limited in 1989.  

In the 1990s, the group decided to further diversify into the cement industry as part of its long-term strategic growth plan. The cement entity was initially incorporated as Zaman Cement Company Limited, named in honor of Mr. Qamar uz Zaman. It was later rebranded as Flying Cement Company Limited, aligning with the group’s established brand identity. The company commenced commercial production in January 2005.

Flying Cement registered Head Office is situated at 169-A Allaudin Road, Lahore Cantt and manufacturing facility established at Mangowal, District Khushab; located in province Punjab. The Company’s lease for limestone mining stands 25 years from now. The company deploys Japanese plant at its manufacturing facility supplied by IHI Japan. 

Currently, the Company has ~ 2.3% share in North region’s cement capacity (operational). The Company announced up gradation of the existing capacity and is currently working on the project. After COD, total capacity will be 11,700 tpd (clinker) which is expected to come online by Jul 25.

The ownership of Flying Cement Company Limited is primarily held by the sponsor family, who collectively own approximately 64.42% of the company, mainly divided among 3 brothers; Mr. Momin, Mr. Kamran, Mr. Imran and their families. The remaining shares in public free float. The business was originally founded by Mr. Qamar uz Zaman and is now managed by the second and third generations of the family.

The shareholding of Flying Cement Company Limited is equally divided among the core family members, reflecting a stable and unified ownership structure. As the flagship business of the sponsor family, Flying Cement benefits from their deep-rooted understanding of the industry dynamics, gained through decades of hands-on experience. The second generation currently leads the group’s strategic direction, while the third generation has actively stepped into executive roles, working alongside their fathers and contributing to key operational and managerial functions. While the formal division of ownership among the third generation is yet to take shape, their active involvement ensures continuity, stability, and a succession pipeline for the future of the business.

The sponsors, Mr. Kamran Khan and Mr. Momin Qamar, have been associated with Flying Cement Company Limited for decades and bring with them a wealth of experience and deep insight into the cement industry, making their business acumen notably strong. Their long-standing involvement has enabled them to develop strategic decision-making capabilities critical to the company’s growth and stability. While the majority shareholders now include members of the third generation—young professionals with diverse educational backgrounds—their active participation in the family business under the mentorship of the senior leadership ensures that their business acumen is developing steadily and is considered adequate for their roles within the organization.

The Flying Group consists of 3 companies; 1) Flying Paper Industries Limited, 2) Flying Board & Paper Products and 3) Flying Cement Company Limited. Financial Strength of sponsors is considered good owing to the investment in diversified nature of companies

The overall governance structure of Flying Cement Company Limited consists of eight board members, including the Chief Executive Officer, Mr. Agha Hamayun Khan. A majority of the board members are representatives of the sponsoring family, underscoring their active role in the company’s strategic direction. Three members are executive directors—namely, the CEO, Director Sales, and Director Finance—while two serve as non-executive directors. The board also includes two independent directors and one female director.

Mr. Kamran Khan serves as the Chairman of the Board at Flying Cement Company Limited, bringing with him over 45 years of extensive experience in the cement industry. A science graduate, he has further enhanced his leadership and strategic capabilities by attending professional development programs at renowned international institutions, including Harvard Business School, USA. Mr. Kamran Khan plays a pivotal role in overseeing technical operations, particularly focusing on the Company’s capacity expansion initiatives.

The Board comprises experienced professionals, including Mr. Momin Qamar, Mr. Yousaf Kamran Khan, Mr. Qasim Khan, and Mrs. Samina Kamran, all representing the sponsoring family. Mr. Momin Qamar is highly qualified senior level dynamic businessman. He has been actively involved in Business Strategy, Treasury, Finance, Import, Banking and legal affairs of the Flying Group for almost 40 years. Through his diversified entrepreneur experience and rich business portfolio, he has played a pivotal role in fund management, business ventures, tax planning, legal affairs and business strategy associated with various group companies. His financial & legal expertise, advisory, consultancy and unique negotiable skills have diverted the group towards the growth over the period. His legal matters’ proficiency has resulted in various landmark judgments declared by apex court (Supreme Court) of Pakistan for the betterment/encouragement of local industry viz import. Consequently, level playing field has been allowed to various local industries to boost GDP of the country.

Additionally, Mr. Omar Naeem and Mr. Pervaiz Ahmad Khan serve as independent directors. Collectively, the Board brings a strong blend of industry knowledge, governance expertise, and strategic acumen, enabling effective oversight and long-term value creation for the Company.

There are two board committees in place to assist the Board in the decision-making process: the Audit Committee and the HR & Remuneration Committee (HR&R). The Audit Committee is chaired by Mr. Omar Naeem, while the HR&R Committee is chaired by Mr. Pervaiz Ahmad Khan, with both committees led by independent members. The Internal Audit Department reports directly to the Board.

M/s. Naveed Zafar Ashfaq Jaffery & Co., Chartered Accountants, the external auditor is categorized satisfactory by ICAP has given an unqualified opinion on the Company’s financial statements for the year ended Jun-24. The auditors are QCR rated by ICAP.

Flying Cement has a multi-tier organizational structure, divided into four key functions, namely (I) Finance, (ii) Technical & Administration/ HR/ IT, (iii) Factory Administration and, (iv) Sales/ Marketing. Each function is headed by a separate director who, in turn, reports to the Board directly.

Mr. Agha Hamayun Khan, CEO, has been associated with the company for the last 25 years. Mr. Momin Qamar Graduate in Business with 38 years’ experience handling financial, banking affairs. Mr. Qasim Khan Graduate in International Business manages day to day sales/ marketing & procurement affairs of the company while Mr. Yousaf Kamran Khan, Graduate in Business Administration from Regents Business School London is Director Technical & Administration.

Majority of the sponsors are into management so there are no formal committees for the management. Important matters are discussed in the meeting of the management. The members review business operational progress while taking the decisions there and then.

Flying Cement deploys in house software by the Australian software firm. The MIS reporting is built in Power Builder Language, and the old version is being used by the company.

The company has established an internal audit function staffed with experienced personnel to ensure effective internal controls. However, the Board has not formally constituted a separate Risk Committee. Instead, related risk management activities are carried out by senior officers, who are responsible for monitoring and assessing risks. These officers provide regular updates and reports to the Board, ensuring that the Board is apprised of any potential risks and the steps being taken to mitigate them.

The local cement industry faced significant challenges throughout FY24, primarily due to the country's economic difficulties, including high inflation, soaring interest rates, and reduced developmental activity. Additionally, political instability led to lower Public Sector Development Program (PSDP) spending, compounding the challenges faced by the construction sector, which was already struggling with rising input costs. Despite these challenges, the cement industry in Pakistan witnessed marginal growth of ~1.6%, reaching 45.3mln MT during the year ending June 30, 2024, compared to 44.6mln MT last year. Although the local sale volumes declined by 5% (FY24: 38.2mln MT, FY23: 40.0mln MT), the overall surge was driven by a significant rise in export dispatches of 56%, reaching 7.1mln MT, up from 4.6mln MT last year. A similar trend was witnessed during 1HFY25, with the local dispatches recording a decline of ~10.5% (1HFY25: 18.12mln MT, 1HFY24: 20.24mln MT), while export dispatches grew by ~31% (1HFY25: 4.81mln MT, 1HFY24: 3.66mln MT). Despite the decline in sales volumes, the local cement manufacturers are witnessing a rising trend in their recorded revenues due to the higher prices reflecting the increase in the cost of production that is being passed on to the consumers. As a result, cement manufacturers have successfully maintained their margins. The industry also witnessed a rise in installed capacity, which now stands at approx. 85mln MT per annum. However, based on the stressed demand, capacity utilization remained between 50-55% during FY24. Going forward, FY25 brings some relief for the industry in the form of consistent reduction in policy rates, declining inflation, a stable exchange rate, and gradual increases in SBP reserves along with political stability. However, the development activity in the form of construction projects to stimulate the economy is still on hold.

The Company is currently a smaller player in the industry, operating at a capacity of 1.2 million tons per annum (TPA), which translates into a market share of 2.3% of the cement capacity operational in the North region and 1.26% of the overall operational cement capacity in the country. To maintain and potentially enhance its market position, the company is undertaking an expansion of its existing production capacity, which is expected to come online by July 2025. While the company’s primary market currently comprises regions in close proximity to its plant, the planned expansion will enable it to extend its market reach to other areas as well.

During 1HFY25, the company reported revenue of PKR 3.9 billion in, compared to PKR 2.3 billion in 1HFY24, reflecting a robust growth of approximately 70%, driven by sustained high retention prices. This increase was supported by a 33% rise in price per ton and a 73% growth in dispatches compared to SPLY.

During 1HFY25, Flying Cement experienced a notable decline in margins compared to 1HFY24, primarily due to higher costs—especially elevated energy prices. The situation was further impacted by expenses related to ongoing expansion activities, resulting in a decline in gross margin to 12.75% in 1HFY25 from 16.39% in the corresponding period last year. Additionally, rising inflation, increased tax provisions, and higher finance costs continued to weigh on overall profitability. As a result, net profit margin dropped to 1.5% in 1HFY25, down from 7.7% in 1HFY24 (FY24: 1.1%). However, the recent decline in energy prices—particularly electricity—and a potential reduction in policy rates, leading to easing KIBOR, are expected to positively impact margins going forward.

The Company is fully committed to the completion of its Line 2 expansion project, with Commercial Operations Date (COD) expected near June 2025. Upon completion, this project will enhance Flying Cement's annual production capacity to approximately 4.4 million tons, enabling the Company to sustain and potentially increase its market share. The expansion is expected to improve operational efficiency, optimize cost structures through economies of scale, and strengthen the Company’s long-term sustainability and competitiveness in the industry.

As of Dec-24, the Company’s net cash cycle was recorded at -124 days (1HFY24: -70 days), primarily due to a significant increase in trade payable days, which rose from 242 days in Dec-23 to 281 days in Dec-24, however this includes payments to the contractors for the planned expansions.Additionally, inventory days declined to 147 days in 1HFY25 as compared to 158 days in 1HFY24. The Company relies on a combination of internal cash flows and short-term borrowings to meet its working capital requirements. The current ratio remained stable over the period, holding at 0.4x from December 2023 to Sep-24 but declined slighly to 0.3x in December 2024.

During 1HFY25, the Company’s Free Cash Flows from Operations (FCFO) stood at PKR 86 million, compared to PKR 227 million in 1HFY24 (FY24: PKR 603 million; FY23: PKR 641 million). Finance costs also declined, amounting to PKR 21 million in 1HFY25 versus PKR 54 million in the same period last year. As a result, the interest coverage ratio improved to 5.1x as of September 2024, up from 3.8x in June 2024. However, it still remains under pressure due to upcoming debt repayments.

As of Dec 2024, the Company’s long-term debt stood at approximately PKR 5bln, while its equity base was reported at PKR 12.3bln. Consequently, the debt-to-debt-plus-equity ratio was recorded at 34.2% in 1HFY25, compared to 35.8% in 1HFY24 (FY24: 35.3%, FY23: 35.9%). Short-term borrowings made up only 5% of the total borrowings. Due to delays in the COD of the planned expansion and the resulting financial stress, the Company requested the bank to align the principal repayments with the COD by deferring them to relieve the financial pressure. The bank has agreed to this request. Meanwhile, the company continues to meet its interest repayments on time.