annual report 2025

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annual report 2025

rooted in character driven leadership

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rooted in character 423 driven leadership

rooted in 423 character driven leadershipengro

about the theme This year’s theme draws on the image of a mature tree to reflect leadership rooted in character and truth. Its expansive root system represents the values and principles that anchor the organization; integrity, transparency, and accountability, nourishing growth and enabling it to endure change. What stands visible above ground is a direct outcome of this foundation, symbolizing sustained performance, resilience, and continuity built on honest disclosure and responsible governance.

The theme is brought to life through four indigenous trees; Deodar, Sheesham, Peepal, and Neem, each featured across the Annual Reports. Deeply connected to Pakistan’s landscape, these trees reflect Engro’s role in supporting the systems that sustain the nation, grounded in openness and trust. Together, they reinforce a simple truth: enduring success, like credible leadership, is built from the ground up, rooted in truth and shared transparently with investors, partners, and shareholders

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rooted in character driven leadership

rooted in 423 character driven leadership

423

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external assurance / reviews

reporting framework

This report has been prepared in compliance with:

The accounting and reporting standards as applicable in Pakistan comprise of IFRS Accounting Standards ��

��

Assurance	External firm
Review report on Compliance with Code of Corporate Governance	��
Independent Auditor’s report on the audit of ��	��
Independent Auditor’s report on the audit of ��	��
Cost auditors report	��
Entity’s Credit Rating	Pakistan Credit Rating Agency

��

�� Limited (PSX).

It also maps our contribution to the UN sustainable development goals.

board approval

The Board of Directors of Engro Fertilizer Limited acknowledges their responsibility of ensuring the integrity ��

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annual report 2025

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table of
contents
company overview
vision 05
�� 07
company information 09
group structure 11
board of directors 13
management committee 23
geographical presence 25
�� 27
�� 29
our history 39
company’s milestones over the years 41
2025 at a glance 45
code of conduct 47
core values 49
statement of ethics 51
key performance highlights 2025 52
�� 53
�� 57
our business model 58
�� 62
swot analysis 65
�� 67
how we create value 69
stakeholder engagement 71
corporate governance
our governance framework 77
internal control framework 89
internal audit, ethics, and compliance 94
�� 97
enterprise risk management 101
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	business performance chairman’s review	113
	ceo’s statement	117
	directors’ report ��	121 185
	��	192
	investor relations	210
	��	211
	social and relationship capital	247
	manufactured and intellectual capital	258
	engro’s leadership competency model	273
	��	274
	human capital	275
	forward looking statement	291
	financial statements
	��	297
	��
	��	301
	independent auditor’s review report on the statement of compliance
	��	304
	��	307
	��	313
	��	379
	��	385

	shareholders information

	notice of annual general meeting	451
	��	463
	pattern of shareholding	465
	categories of shareholding	472
	��	473
	standard request form	479
	proxy form	480
	��	481
	��	492

business performance

financial statements

shareholders information

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company overview

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rooted in
423 character
driven leadership
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rooted in
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annual report 2025 driven leadership
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engro fertilizers limited engro fetilizers limited annual report 2025 annual report 2025

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vision We are passionate about transforming the agricultural landscape, bringing change, and helping the farmer grow.

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company profile

��

EFERT is a renowned name in the Pakistani fertilizer industry, trading on the Pakistan Stock Exchange (PSX) under the symbol “EFERT”. �� infrastructure, producing leading fertilizer brands optimized for local cultivation needs and demand.

EFERT has earned itself a distinguished name by continually striving to uphold its tradition and the trust of its customers.

rooted in 423 character driven leadership

rooted in character 423 driven leadership

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board of directors

chairman & non-executive director

Mr. Ahsan Zafar Syed

non- executive directors

�� Mr. Farooq Barkat Ali Mr. Ahmad Shakoor

independent directors

Mr. Rizwan Khalil Sheikh Ms. Sadia Khan Mr. Mohammad Younus Dagha

chief executive officer

Mr. Ali Rathore

chief financial officer

Mr. Muhammad Imran Khalil

company secretary

Mr. Danish Raza

banking partners conventional banks

Allied Bank Limited Askari Bank Limited Bank Al Habib Limited Bank Alfalah Limited �� Habib Bank Limited Habib Metropolitan Bank Limited ��

��
��

National Bank of Pakistan Samba Bank Limited Soneri Bank Limited

�� The Bank of Punjab United Bank Limited

shariah compliant banks

Al Baraka Bank (Pakistan) Limited BankIslami Pakistan Limited Faysal Bank Limited Habib Bank Limited �� Meezan Bank Limited Bank Makramah Limited United Bank Limited ��

auditors

��

registered office

�� Website: www.engrofertilizers.com www.engro.com

plant sites

daharki

�� Sindh

��

zarkhez

��

share registrar

Famco Share Registration Services (Private) Limited �� Shahrah-e-Faisal, Karachi, Pakistan ��

speak-out

Whistleblower Hotline for complaints or concerns in relation to business ethics and compliance �� Email: [email protected] ��

ceo message (video link)

https://www.engrofertilizers.com/trust#gallery

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group structure

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Engro Friesland Engro Engro Engro
Campina Polymer &
Fertilizers Energy Eximp FZE
Engro Pakistan Chemicals
Limited Limited Limited Limited (Dubai)
56.27% 39.93% 56.19% 100% 100%
EngroTech
EFert Think Engro Ventures –
Agritrade Pvc (Pvt.) Peroxide FZCO
(Pvt.) Limited Limited (Pvt.) Limited (Dubai)
100% 100% 100% 100%
G
Listed Entities
Unlisted Local Subsidiaries Engro
GEL Utility
Powergen
Limited
Unlisted Local �Vs, Associates & Investments Qadirpur
(Nigeria)
Limited
Trust / Foundation / Non-Pr��s 45% 68.9%
International Unlisted Subsidiaries
International Unlisted Associates & Investments
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----- Start of picture text -----

Engro
Holdings
Limited
Engro
Corporation Engro
Limited Foundation
(Trust)
100%
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----- Start of picture text -----

Engro
Engro Technical Engro Vopak
Connnect Terminal
(Pvt.) Limited Solutions (Pvt.) Limited
Limited
100% 100% 50%
Deodar Engro
(Pvt.) Enfrashare
Limited (Pvt.) Limited
100% 100%
Engro
Sindh Engro Engro Power
Powergen Coal Mining International
Thar (Pvt.) Company Holding BV
Limited Limited (Nether Lands)
50.1% 11.9% 100%
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Elengy
Terminal Pakisan
Limited
56%
Engro
Elengy Terminal
(Pvt.) Limited
100%
56%
100%
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Note: The above companies include all the active business entities under Engro Holdings Limited during the year ended ��[st ] ��

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Pictured from left to right (standing):

�� Pictured from left to right (seated):

��

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Ahsan Zafar ��

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Asad Said ��
��
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�� conglomerates, with a business portfolio spanning petrochemicals, energy and related infrastructure, telecommunication infrastructure, food & agriculture, �� commitment to help solve some of the country’s most pressing issues. During his tenure, Ahsan has focused on consolidation and optimization of assets; notably, thermal energy assets have re-integrated into Engro’s business portfolio, while operational enhancements have been made across fertilizers, polymers, and terminals. Ahsan has also championed a culture of business development across the group.

�� engineer, accumulating three decades of experience in operations, project management, and strategic leadership across the petrochemical, energy, and food & �� milestones for the company; he was one of the driving �� project and played a pivotal role in executing the US$2 billion Thar dream, aimed at indigenizing energy for Pakistan.

�� business. Under his leadership, Engro Fertilizers became the most valuable fertilizer company on the Pakistan

Stock Exchange. Prior to that, Ahsan played a pivotal role �� dream by unearthing indigenous coal and ��

In recognition of his engineering contributions to Pakistan, Ahsan was awarded the prestigious ‘National Engineering Excellence Award’ by the Institution of �� honorary services to the Engineering Development Board, an entity under the Ministry of Industries & Production, Pakistan, entrusted to strengthen the engineering base in the country.

Ahsan is an alumnus of NED Karachi and Manhattan �� management programs at INSEAD in France.

�� Singapore. Asad has extensive manufacturing, supply chain, business excellence and general management experience and has held various leadership roles at Philips including overseas expatriate postings to Indonesia, Thailand and Singapore from �� Manager at Philips Pakistan Limited. He drove the transformation and revitalization of the Philips business in Pakistan to become a focused lighting technology company offering a complete range of conventional and LED lighting solutions including its connected lighting systems and data-enabled services, design services and turnkey solutions. As �� Pakistan. He steered the transition of the company from Philips to Signify in Pakistan.

�� into various roles in projects, plant maintenance, design and engineering planning before leaving the company to pursue an MBA degree.

�� Directors of Engro Fertilizers Limited, Unilever Pakistan Foods �� Limited. Previously he has served on the Board of Directors of ��

�� International Advisory Board at NED University of Engineering and Technology. He has participated regularly in Karachi School �� holds an Electrical Engineering (BE) degree from the NED University of Engineering & Technology and a master’s degree in �� faculty for delivering this training.

Asad has completed several management development programs including the ‘Leading a Business’ program at Ashridge Business School, UK. He attended the ‘Philips �� School of Business (London campus) as well as the ‘Business Marketing Strategy’ program at Kellogg School of Management, Northwestern University, USA. He is often invited to address business professionals and student audiences at corporate and academic events.

Asad is now working as a management consultant to provide advisory services to organizations that have an ambition to �� maturity, right across the value chain. This includes providing support for organizational development, employee assessments & organization structure improvements, executive coaching, operational capability assessments, process improvements, performance tracking, company purpose & �� overall improvements in corporate governance.

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rooted in character 16 driven leadership

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Farooq Barkat Ali ��

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Ahmad ��
��
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�� Engro Fertilizers, and Engro Energy Limited (EEL). Farooq has also served as Vice President - Finance at Engro ��

Farooq carries two decades of experience in various �� career, Farooq has managed multiple projects including �� and mergers & acquisitions.

He also serves on the Board of Engro Fertilizers Limited, �� (Pvt.) Limited, Engro Elengy Terminal Pakistan Limited, Engro Energy Services Limited, Engro Power International Holding BV, Engro Power Investments International BV, and Engro Power Services Holding BV.

�� and has also been previously associated with ��

�� engineering, project development and business development of various key projects.

Ahmad has extensive experience of leading feasibility/FEED studies and working with international licensors, partners and consultants, for several ��

�� transformation initiatives in the areas of safety, engineering, and project development.

Ahmad has completed his studies from the University of ��

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rooted in character 18 driven leadership

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Mohammad Younus Dagha Independent Director

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Rizwan Khalil �� Independent Director

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Mr. Mohammad Younus Dagha is a career civil servant who joined Pakistan Administrative �� possesses varied experience�� administration. He holds graduate and post graduate degrees in business administration, economics, law and commerce equipping him with the required academic background to manage multifaceted assignments in his career.

�� successfully handled many challenging assignments. From being an Administrator at various tiers in the Provinces of Sindh, Khyber Pakhtunkhwa and �� successfully handled many important assignments as �� commerce & water and power.

Mr. Dagha assisted the Federation of Pakistan �� establishing a policy research unit, in his capacity as the �� Now he has established an independent think-tank with �� in several policy advocacy papers/briefs prepared in

consultation with the academia, civil society and the stakeholders on various aspects of the economy from monetary�� also �� and Malaysia.

Mr. Mohammad Younus Dagha also remained part of the �� revenue, industries and commerce and introduced e-services and e-registration in the industries and revenue departments.

�� recently, he played a central role in the downstream �� production platforms domestically and in key markets ��

His current role as a secondee to MOIAT focuses on investor attraction to the UAE where he works with key �� institutions both on the policy side as well as for global outreach.

�� in establishing the downstream business for Saudi �� Arabia, two �� projects in��

His diversity of commercial and technical acumen stems from gathering multi-industry, multi-client experience across a wide geography working as a �� has also served as member of various leadership ��

�� and Business Administration.

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rooted in character 20 driven leadership

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Sadia �� Independent Director

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Ali Rathore
��
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Sadia Khan is a seasoned governance professional and �� of experience across investment banking, development �� has worked in leadership roles across Asia, Europe, and North America, bringing a global perspective to corporate oversight and board stewardship.

�� played a central role in strengthening governance standards in Pakistan’s corporate sector.

Sadia began her career at Lehman Brothers in New York and has since worked with leading institutions including the Asian Development Bank in Manila, the State Bank of ��

�� and Yale University, and an MBA from INSEAD.

A long standing advocate of corporate governance, she has served as an independent director on numerous �� of Pakistan, published by Oxford University Press in �� a case study on her leadership as ��

Sadia is currently based in Dubai, where she pursues a portfolio career as an educator and governance advisor with a strong focus on sustainability.

�� years of diverse international experience across four continents, including the USA, UK, Australia, and the MENA region. His career spans dynamic environments and industries such as oil & gas, energy, chemicals, and telecoms, working with organizations from agile �� employees.

Ali’s leadership is rooted in character—anchored in truth, transparency, trust, and integrity. He leads with humility and authenticity, believing that moral responsibility and innovation are essential to building lasting value and inspiring others.

Renowned for an inclusive approach, Ali champions diversity as a catalyst for innovation and organizational

strength. By nurturing talent and a collaborative culture, he empowers teams, ensuring every voice is respected and heard.

With extensive collaboration alongside governments and stakeholders worldwide, Ali has developed a unique ability to navigate complex, fast-evolving markets. His strategic vision and marketing expertise have enabled pioneering projects, driving growth and transformation in highly competitive landscapes.

A graduate of the Kellogg School of Management and �� learning and adaptability. As he leads Engro Fertilizers, his unwavering commitment to truth, transparency, innovation, and inclusive leadership continues to drive sustainable success.

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management committee

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Aneeq Ahmad
Head of Manufacturing Bilal Mustafa Atif Mohammad Ali
Vice President - Marketing
Farrukh Saeed Khan Vice President - Operations
Head of HR
& Communications
Ali Rathore Muhammad Imran Khalil
Chief Executive Director Nazia Ali ��
Head of Digital Transformation
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geographical presence

S.no	Description	Address
01	Head Office	6th Floor, The Harbor Front Building, Plot No HC-3 , Block 4, Clifton, Karachi
02	Daharki Plant	Daharki, District Ghotki, Sindh
03	Zarkhez Plant	EZ / P – 1 – II Eastern Zone, Port Qasim, Karachi
04	Zonal Office – North	4th Floor, 19-A, Ali Block, New Garden Town, Lahore
05	Zonal Office – Central	3rd Floor, Mehr Fatima Tower, Opp. High Court, Old Bahawalpur Road, Multan
06	Zonal Office – South	6th Floor, State Life Building, Thandi Sadak, Hyderabad
07	Regional Office – Faisalabad	4th Floor, Meezan Executive Tower, Liaquat Road, Faisalabad
08	Regional Office – Daharki	��
09	Regional Office – DG Khan	Engro Warehouse, Opp. B.I.S.E. Multan Road, D. G. Khan
10	Regional Office – Sahiwal	Alayan Centre, Police Line Road, Sahiwal
11	Regional Office – Nawabshah	Near Bilawal Stadium, Main Kazi Ahmed Road, Nawabshah
12	Regional Office – Sukkur	Plot # E-37, Pak Memon Cooperative Housing Society, Old Arain Road
13	Engro Markaz Bahawalpur	Chowk Bloachan, opposite 5 Star Petrol Pump, KLP Road
14	Engro Markaz Muridke	Sheikhupura-Muridke Road, Near Maryam Rice Mill
15	Engro Markaz Sahiwal	Opposite Sohni Dharti Seeds Plant 134/9-L, Multan Bypass
16	Engro Markaz Sargodha	85 Jhall Sillanwali Road, Near Sapphire Marriage Hall

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organogram & employee profile
Board of
Directors
Board Audit
Internal Audit & Risk Board People
Committee
Committee
Chief Executive
Officer
Marketing Manufacturing DivisionPeople TransformationDigital AccountingFinance & HSE Shared Department
with ECORP
Information
Finance &
Daharki HR Technology
Planning Transformation
MarketingServices BusinessBase FertilizersSpecialty SupplyChain Agronomy Planning DevelopmentBusiness Zarkhez Admin General Engro
Business Accounting Foundation
Corporate Risk & Public Affairs &
Communications Compliance Govt. Relations
Logistics
Marketing Brands & Marketing
Excellence Communication HSE Central
Taxation
Procurement
Warehousing
Central
Treasury
Technical Admin & IR Operations Medical
Central
Payables
Process Production
Engineering
Mechanical Maintenance
Engineering
Civil & Structural I&E
Engineering
rooted in rooted in
27 character engro fertilizers limited engro fetilizers limited character
driven leadership annual report 2025 annual report 2025 driven leadership
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product portfolio & services

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product portfolio & services

we grow brands

At EFERT, we believe in delivering the highest standards of quality hence our focus goes beyond the performance of brands to how our brands are impacting the lives of our consumers and �� malnutrition and driving The Nation’s Food Security Agenda to meet Sustainable Development �� customer needs and expectations.

The primary business segments of the company are:

Straight Fertilizers (Engro Urea, Phosphatic Fertilizers).

��

�� source, Right dose, Right time and Right method of application)

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Fertilizers

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EFERT has a portfolio of premium fertilizers that focuses on balanced crop nutrition and improved crop yields, including Engro Urea and DAP (Di-Ammonium Phosphate) which comprise of some of the most trusted brands among Pakistani farmers.

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Engro Urea

�� Pakistan, a landmark event in agricultural sector of the �� expansion steps, production capacity increased to �� tons per year.

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Nitrogen is the most important nutrient required by �� Nitrogen. It is the most concentrated solid Nitrogen fertilizer which is produced in prilled form. It is white in �� crops, orchards and turfs for healthy plant growth and ��

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Phosphatic Fertilizers

Engro NP Plus

Engro NP Plus is an innovative formulation that contains �� providing balanced growth in terms of crop health and productivity.

�� flower shedding. It is ideally suited for soil application and broadcasting at the time of seed sowing as well as, during early crop growth stage. It is marketed in a ��

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Engro DAP

�� imported in Pakistan by the fertilizer import department (FID) however, due to deregulation of imports the private sector took over and EFERT became one of the largest importers in the country.

Engro DAP is a compound fertilizer that has a Nitrogen to �� used sources of Phosphorus in Pakistan. It strengthens the roots of plants as well as, contributes to flowering and fruit formation and enhances grain size and weight. EFERT has been importing and marketing Engro DAP in �� Standards (PS) and only the best quality is imported from renowned sources from around the world. This is the reason it is a popular and trusted brand among ��

Engro TSP

Engro Triple Super Phosphate (TSP) is a highly ��₂O₅. �� rapid nutrient availability for crops. It is in granular form �� compared to other Phosphatic Fertilizers due to its lower pH and higher solubility.

Engro TSP is suitable for various crops like cereals, legumes, vegetables, fruit trees and pastures, as it enhances rooting and reproductive success. Moreover, its acidic properties are suitable for our soil, as it corrects �� trusted solution for sustainable crop nutrition, improving yield and crop quality.

Engro Zorawar

Engro Zorawar or Mono-Ammonium Phosphate (MAP) is a compound fertilizer with high content of Phosphate ��

It is in granular form and acidic in nature, having high �� Fertilizers. Engro Zorawar supports seed germination, strengthens root development and improves tillering in

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Wheat, Rice and Sugarcane. In addition, it also helps in improving grain health in cereals, gives more flowers and better fruiting in cotton, vegetables and fruit trees. EFERT is the only company which imports MAP in the country. Due to white color, it has less chances of ��

Specialty fertilizers are an extension of fertilizer’s business with unique products targeting higher crop �� fertilizers address malnutrition and contribute to �� new and innovative products developed after research and development using state of the art technology.

Engro Zarkhez

�� nutrients especially in Nitrogen, Phosphorous and Potassium.

As a result, yields and quality of fruits are low. EFERT has introduced Engro Zarkhez which has all the three major nutrients in a balanced proportion. The presence of all �� nutrient uptake. The application is convenient with a granular nature for the farmers whether it is applied through manual application, automatic or a planter. Engro Zarkhez is currently available in two different variants which are Engro Zarkhez Plus and Engro ��

Engro Zarkhez Plus

�� ensure prolonged availability of nutrients resulting in higher yield and good quality of produce.

��

Engro Zarkhez Khaas

Engro Zarkhez Khaas is a unique recipe with Boron and ��

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�� plants and orchards. Engro Zarkhez Khaas improves fruit yield and quality, reduces flower and fruit shedding. ��

Engro Zingro

Zinc is a micronutrient which the crop requires in small dosages and it complements the functions of major nutrients.

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�� on a variety of crops especially, in rice. Use of Engro Zingro which, is a premium product, results in quick response and improved crop yields due to improved Zinc �� fertilizer which, means it is free from heavy metals. It is ��

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Engro Zabardast Urea

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�� leap forward by EFERT in pioneering next generation fertilizers in Pakistan.

This product is developed in collaboration with Niha �� microbes that mobilize nutrients in soil and enhance �� all the crops as it increases crop yields, improves quality and enriches zinc contents in produce. It is marketed in a ��

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Engro MOP

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In addition to potash based blended fertilizer, Potassium can also be applied in the form of straight fertilizer out of which, one widely used potassium fertilizer is Engro Muriate of Potash (MOP).

�� the most concentrated form of granular potassium. It can be used in every type of soil except, saline soils (which have high contents of chloride) and chloride sensitive crops like Tobacco. It improves crop yields and

develops resistance to diseases. It also improves color, flavor and shelf-life of fruits and vegetables. It is ��

Engro SOP

Engro SOP is a premium, chloride-free form of Potassium that can be applied as a straight fertilizer. Engro SOP is available in granular form, targeting all potash loving crops such as potato, maize, sugarcane, wheat, rice, cotton, vegetables, fruits, orchards and �� quality and crop yields, but also makes plants resilient to drought, frost, insects and diseases. It is marketed in a ��

Engro Ammonium Sulphate

Engro Ammonium Sulphate with Ammoniacal Nitrogen �� the supplemental need of Nitrogen and Sulphur in growing plants.

It is an acidic fertilizer which is highly soluble in water �� becoming increasingly aware of the importance of Sulphur as a secondary nutrient as it helps in nutrient uptake and increases resistance against diseases like ��

Engro Zoron

��

�� plants, increases crop yields, retains the shape of the produce, reduces flower and fruit shedding as well as, improves overall quality. It can be used for soil or foliar application. Engro Zoron is recommended for cotton, cereals (rice, maize, oat), vegetables (onion, potato, tomato, cauliflower), fruits (apple, banana, grapes, guava, apricot, pear, peach, plum), roses and other ornamental ��

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rooted in character driven leadership

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Engro Potash Power

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Engro Potash Power has a high composition of ��

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�� enables availability of other nutrients to the soil and is suitable for both soil and foliar applications with high �� Engro Potash Power provides greater resistance against frost. It increases fruit size, fruit appearance, organoleptic features and shelf life. Engro Potash Power is for all crops including cotton, wheat, rice, sugarcane, sunflower, maize, flowers and fruits at mid to late-stage application for improving health, yield, optimal plant ��

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Engro Phos Power

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Engro Phos Power, imported from Europe, is acidic in �� product, free from impurities which improves the availability of calcium, magnesium and other trace elements to the plant.

It can be used for soil or foliar applications, and applied to all types of crops, orchards and vegetables for improving health, vigor, yield and overall quality of ��

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Engro SOP Power

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SOP Power is imported, packaged, and sold directly by �� absorption of vital nutrients for Potash in all crops such as Vegetables, Maize, Potato and Orchards.

SOP Power seamlessly integrates with drip irrigations systems, strengthens roots, improves crop quality and ��

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services

�� Markaz to directly support and empower farmers.

�� fertilizer retail in Pakistan. These company-owned outlets provide farmers with direct access to authentic products, controlled pricing, and value-added services. By removing intermediaries, Engro ensures consistent pricing, product availability, and service quality.

Engro Markaz guarantees genuine, high-quality fertilizers through branded physical outlets, reducing the risk of counterfeit products and strengthening trust in the Engro brand. The outlets also offer a comfortable space for �� reliable supply ensures availability during key sowing periods.

��

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Small Parcel Delivery (SPD) has emerged as a high-impact value-added service, offering doorstep delivery to farmers
��
��
through the use of this service.
��
��
rooted in
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annual report 2025 driven leadership
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our
history
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�� gas in Mari while pursuing viable oil exploration in Sindh. Pak Stanvac’s focus was exclusively on oil exploration, however, the discovery shifted the impetus to Esso, which decided to invest in the massive industrial potential �� giant urea plant in Daharki, about ten miles from the �� as its primary raw material to churn out urea fertilizer.

�� and an agreement was signed allowing Esso to set up a �� Esso brought in state-of-the-art design, commercially tried facilities, and a highly distinguished pool of technical expertise to ensure a smooth start-up. The �� largest foreign investment made in Pakistan to date ��

To boost sales, a full-fledged marketing organization was established which undertook agronomic programs to �� modernize traditional farming practices and boost farm yields, directly impacting the quality of life of the farmers, their families, and the nation at large. Farmer educational programs increased the consumption of fertilizers in ��

�� divest its fertilizer business on a global basis. The �� and perhaps the most successful employee buy-out in Pakistan’s corporate history to date. The company was �� company� �� performance, growth of its core fertilizer business, and �� enterprises. A major plant capacity upgrade at Daharki coincided with the ��Engro also relocated fertilizer manufacturing plants from the UK and US to its �� Limited started venturing into other sectors namely: foods, energy, chemical storage, handling, trading, industrial automation, and petrochemicals.

��

�� produce Specialty Fertilizers for Pakistani Progressive �� blended NPK fertilizers but also a one of a kind plant, employing steam granulation technology to produce specialty fertilizers. The Plant’s basic engineering design �� To help cater to the overwhelming demand from the farmers for specialty fertilizers, the plant was debottlenecked, increasing its nameplate capacity from��

�� different industries. These continuous expansions �� Pakistan Limited, which subsequently demerged to form a new Engro ��

After the necessary legal procedures and approvals, the �� assets and liabilities have been transferred to Engro Fertilizers Limited against the issue of shares to the ��

�� The total cost of this expansion was approximately US �� manufacturers in Pakistan. This has substantially reduced the cost of urea imports to the national exchequer.

�� to fund development capex on securing additional gas supplies along with restructuring the balance sheet to optimize the capital structure of the company. The IPO was a roaring success, oversubscribed four times in the book-building process and three times during public issues.

engro fertilizers limited

rooted in 423 character driven leadership

rooted in character 40 driven leadership

engro fetilizers limited

annual report 2025

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company’s milestone over the years

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1957
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�� by Esso Mobil joint venture

1964

Signed agreement with the government to set up a urea plant with an annual ��

1965

The company was incorporated as Esso Pakistan Fertilizer Limited, to manufacture and market fertilizers

1968

Urea plant commissioned

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1991
led buy-out
1992
��
1998
plants
��
��
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Exxon divests its equity from fertilizer business globally; �� Limited through an employee led buy-out

Relocation of world-scale ammonia and urea plants ��

��

Debottlenecking of relocated plants

��

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2007
2010
2011
production
2013
Successful IPO
conducted;
the process
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Started construction of world’s largest single-train urea plant - EnVen

Demerger of Engro �� Limited and transfer of fertilizer business to a separate company. Engro Fertilizers Limited. Engro ��

EnVen capitalized and started commercial production

Successful IPO conducted;

�� the process

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2014
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�� Urea sales in the history of Engro Fertilizers of �� resulting in the highest ��

2015

Highest-ever production �� as highest-ever Urea sales ��

Only fertilizer company registered with Dupont to �� Safety Management Systems Acquisition of Engro Eximp’s Phosphates business

2016

�� Total Recordable Injury �� phosphates sales of ��

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2018
Safety Systems
2019
��
��
precision”
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2nd Highest-ever consolidated revenue ��

Highest-ever fertilizer ��

EFERT Marketing team becomes the only team in Pakistan to achieve a �� Safety Systems

Highest-ever consolidated ��

��

Best safety plant TRIR of ��

Stepped into the logistics paradigm during the year, aiming to deliver “movement with precision”

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2020
��
lowest TRIR
��
��
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��

when EFERT fought against all challenges and delivered on its promise. The year was marked with hallmark production and sales performance

Achieved the milestone of the highest annual Urea �� its history with record lowest TRIR

Urea sales crossed the ��

EFERT pioneers E-Bank ��

rooted inrooted in 44123 charactercharacter driven leadershipdriven leadership

rooted inrooted in charactercharacter 44223 driven leadershipdriven leadership

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2021

2022

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2023
metric tons
��
billion
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2024

2025

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��
in women in senior
leadership roles across
the organization.
Maintained Zero TRIR at
Zarkhez Manufacturing
��
��
million safe manhours
completed by the
Marketing HSE Division
Successful upgradation
��
��
Soared to the 2nd
position on the PSX’s list
��
marking our highest rank
to-date
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��
��
��
��
��
��
Issued Pakistan’s largest
unsecured, privately
placed short-term Sukuk,
��
billion
Reached a market
��
billion
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driven leadership
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at a glance
08
Sustained a 25% increase in women in senior leadership Attained
roles, with the overall diversity ratio improving 1.5x 1st position ��
�� 2nd Position ��
Overall
Issued largest unsecured privately placed short-term 1st position in Management Association of Pakistan Awards
Sukuk in Pakistan - Rs. 20 Bn
��
10
02 09
86+ Mn safe manhours Market capitalization reached
without a Lost Workday Injury (LWI) Rs. 302 Bn
Import subsitution of USD 906 Mn through sale of Launch of Engro Triple Super Phosphate , a high quality fertilizer
fertilizer products containing 46% Phosphorous
12
04 11
Won British Safety Council – International Safety Award Secured regulatory approval for the allocation of gas
(Distinction) for outstanding HSE performance for its Base plant
Secured
Reported a robust PAT of Rs. 23 Bn
4 [[th]] Position on the PSX’s list of top 25 companies
14
06 13
Soared to the ��
1 [[st]] Position at the IFC-PBC Employer of Choice Awards 2025 Rs. 403 Mn in corporate social responsibility
rooted in
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01
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Issued largest unsecured privately placed short-term Sukuk in Pakistan - Rs. 20 Bn 03 86+ Mn safe manhours without a Lost Workday Injury (LWI) Import subsitution of USD 906 Mn through sale of fertilizer products 05 Won British Safety Council – International Safety Award (Distinction) for outstanding HSE performance Secured 4[[th]] Position on the PSX’s list of top 25 companies 07 Soared to the 1[[st]] Position at the IFC-PBC Employer of Choice Awards 2025

code of conduct

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empowerment with accountability

Engro seeks to empower its employees to facilitate business decision-making and are responsible for their own behavior, but at the same time, it holds them accountable for their actions.

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commitment to engro’s stakeholders

Engro regards its stakeholder engagement as an important element of corporate responsibility. Adherence to the highest ethical standards fosters trust. We want our stakeholders to know that they can depend on us. We are answerable to our shareholders, our customers, our families, our vendors and suppliers, the communities where we operate, and of course to each other.

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promoting a positive work environment

All employees want and deserve a workplace where they feel safe, respected, and �� objectives.

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anti - corruption & bribery

Engro has a zero-tolerance approach towards bribery and/or corrupt practices and ensures all its business dealings and relationships are based on merit. In this regard, employees are bound by the policies pertaining to Anti-corruption & Bribery, gifts and business entertainment and fraud risk management policy.

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legal compliance

When making decisions to conduct business, employees must ensure they are aware of their actions and choose not to violate the law. In addition to having �� sought from the company’s legal advisors

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protecting the company’s assets

�� information.

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managing business relationships

Employees’ dealings with customers, suppliers, contractors, competitors, or any �� any consideration of personal preference or advantage, and must avoid conflicts of interest, apparent or otherwise.

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rooted in character driven leadership

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core values At Engro we never forget what we stand for - our people, our purpose, and our unwavering commitment to doing what is right.

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health, safety & environment

Cares deeply about environmental impact and safety of people

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ethics & integrity

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Has impeccable character and lives by highest standards of integrity and accountability

community & society

Nurtures passion to serve country community and company belief in the dignity and value of people

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rooted inrooted in 44923 charactercharacter driven leadershipdriven leadership

rooted inrooted in charactercharacter 45023 driven leadershipdriven leadership

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statement of ethics

Integrity is a vital part of Engro’s core values and how we conduct business. Our reputation is built on our values as a company, the values of our employees and our collective commitment to acting with integrity throughout our organization.

�� with the highest ethical standards of business practice and in compliance with all relevant legal principles. We commit to upholding the highest standards of integrity above and beyond legal requirements where applicable.

These values are ingrained into our identity as a company and guide the way we interact with each other, customers, business partners, regulators and other stakeholders. We are committed to fostering a strong ethical culture that upholds these principles in every aspect of our business

key performance highlights 2025

Urea Production

Urea Sales

2025 2025 2024 2024 2,026 2,147KT Revenue 2025 2025 22,628mn 237,131mn 2024 2024 28,260mn 256,675mn 2,314 2,290KT

Net Profit After Tax

Market Capitalization

Gross Profit Ratio

2025 2025 302 bn 30.6% 2024 2024 273 bn 28.02% EBITDA 2025 2025 34% 51,457mn 2024 2024 31%

Market Share-Urea

2025 51,457mn 2024 53,744mn

Earning per Share

Dividend Distributed Per Share

2025 Rs 16.95

2025 Rs 19.0 2024 Rs 21.5

2024 Rs 21.16

rooted inrooted in 51423charactercharacter driven leadershipdriven leadership

rooted inrooted in charactercharacter 52423 driven leadershipdriven leadership

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SAFA
Awards 2024
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people

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IFC-PBC Employer of Choice Awards 2025 Won 1st place overall for

�� Council Awards

digital

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Pakistan Digital Awards 2025 ��

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annual report 2025

marketing

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Effie Award
2025
One Attained
1st position in the Influencer
��
��
��
Award 2025
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corporate awards & achievements

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rooted in character 56 driven leadership

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��

associations

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International Fertilizer
Association
Management Association
of Pakistan
University of Agricultre
Faisalabad-Pakistan
Fertilizer Manufacturers of
Pakistan Advisory Council
Alliance For Water
Stewardship
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Pakistan Agricultural
Coalition
Fertinagro Biotech
National Safety Council
Centre of Excellence in
Responsible Business
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our business model

At EFERT, our business model is built on a clear purpose: fostering sustainable growth while creating meaningful impact across Pakistan’s agricultural landscape. Powered by the trust of our shareholders and the commitment of our leadership, we continue to strengthen operational excellence, accelerate innovation, and deepen our connection with the communities we serve.

Our progress is the result of strong collaboration across a diverse stakeholder ecosystem. From �� role. At the center of this ecosystem stand our customers. Their success is enabled through robust logistics, an extensive dealer network, and the active engagement of the communities in which we operate.

�� maximizing value across the production chain. These efforts reinforce our role as a key enabler of Pakistan’s food security, an obligation we recognize and uphold with pride.

�� portfolio, including products such as Zabardast Urea and newly introduced Engro TSP, we are reshaping modern farming practices. Platforms such as Engro Ennovate and UgAi’s digital expansion have further embedded innovation into our culture, turning insights into scalable, value-driven solutions for farmers.

Our distribution, warehousing, and Engro Markaz network ensures reliability and accessibility across the country. These partnerships extend beyond commercial transactions, they embody shared goals, trust, and a commitment to deliver value to farmers when and where they need it most.

EFERT continues to invest in community upliftment and responsible operations. Whether through capacity building programs like Buland, consumer protection measures, farmer training �� dedicated to contributing to a more sustainable and inclusive future.

Looking forward, EFERT remains committed to transforming Pakistan’s agriculture sector through enhanced productivity, farmer empowerment, and strengthened food security. As we pursue sustainable long-term growth, we remain equally focused on creating exceptional value ��

rooted inrooted in 45723 charactercharacter driven leadershipdriven leadership

rooted in character 58 driven leadership

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capitals & key inputs

Our value chain delivers its promise for sustainable development on all fronts including social, economic, and environmental:

outcomes

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��

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��

rooted in 59 character driven leadership

rooted in character 60 driven leadership

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continuous optimization
of manufacturing facilities. community engagement
we work with our
employees and local
communities. We strive to
build trust in our
Company to enhance
business and become a
trusted partner for
stakeholders.
product use
we work with
farmers to improve
crop yields and
farmers’ incomes.
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significant factors affecting the external environment (PESTEL)

Political tensions between other countries, as also witnessed throughout the year, may result in supply disruptions leading to price volatility with a negative pass-through effect on EFERT’s customers. Discourse/Impact: Procure imported fertilizer strategically and timely, considering the geo-political situation, to maintain price stability.

Enhancements / Initiation of any major gas projects will positively influence the availability of EFERT’s primary raw material.

Discourse/Impact: Engage with the government to pursue sustainable gas availability.

��

��

Discourse/Impact: Engage with the government to enhance farmer economics and sustainable agriculture. Policy makeovers and regulatory changes with respect to agriculture policies and tax laws, consequently impacting business economics.

political •

Discourse/Impact: Work closely with the government and the farmers to provide necessary inputs into the policy-making process.

Domestic political protests/strikes and security-related curtailments can disrupt national logistics and fertilizer availability.

Discourse/Impact: Strengthen contingency planning (alternate routes, buffer inventory, temporary warehousing, and flexible fleet contracting) to protect service levels during disruptions.

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• Foreign exchange changes adversely impact the dollar-linked prices of primary raw materials and imports.

Discourse/Impact: Strategic procurement and considerate pricing decisions could lead to avoidance of the full impact of these fluctuations.

International phosphate price spikes and supply-driven volatility can increase input costs, weaken farmer affordability, and risk imbalanced fertilization that undermines productivity. Discourse/Impact: Diversify phosphate sourcing and offer cost-effective alternatives aligned to local soil conditions to protect farmer economics, sustain productivity, and reduce exposure to global price shocks.
Easing interest rates create an opportunity to optimize borrowing costs and enhance affordability for credit-dependent farmers.

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broadening distribution
opportunities we work with our
through quality dealers to reach
products with customers.
wider distribution
networks.
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Discourse/Impact: �� management; improve farmer liquidity to support timely fertilizer application and yield outcomes.

Dwindling Foreign Reserves create challenges in paying suppliers for the import of Raw Materials. Discourse/Impact: Work closely with the government and State Bank to ensure essential supplies are green-flagged to avoid the impact of these shortages.
��

Discourse/Impact: Examine the implications of recent tax changes, assess the effectiveness �� competitiveness.

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Major economic fluctuations can affect fertilizer demand
Discourse/Impact: �� analyze.

economic

Rising logistics cost drivers (fuel, tolls, labor, and withholding taxes) can elevate delivered cost-to-serve and pressure farmer affordability.

transportation we transport our product through our contractors.

Discourse/Impact: �� initiatives while balancing price stability for farmers.
Evolving customer and stakeholder expectations for faster, localized service delivery increase ��
Discourse/Impact: Expand regional footprint and coordination with provincial stakeholders to improve responsiveness, customer outreach, and workforce wellbeing while supporting regional development.
Limited farmer access to affordable credit constrains timely input purchase and optimal application.
Discourse/Impact: �� ecosystem alongside public schemes to improve accessibility and deepen engagement.

rooted in 61 character driven leadership

rooted in character driven leadership

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annual report 2025

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�� fertilizers.
�� •
Discourse/Impact: Increased reliance on Urea and DAP fertilizers provides an opportunity to �� portfolio of specialty fertilizers that can address special soil/crop needs.

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�� practices increases the importance of stewardship-based advisory and capability building at scale.

An disruption in the political or social environment can lead to social unrest in the neighboring areas of the operational facility.

Discourse/Impact: �� nutrient stewardship to improve yields, reduce losses and emissions intensity, and strengthen climate resilience.

Discourse/Impact: �� may adversely impact our assets.

Increased reliance of farmers on Urea, resulting in an unbalanced consumption of nutrients, affecting the ‘P’ and ‘K’ markets. Discourse/Impact: ��

Water supply is attributed as a scarce resource in Pakistan, leading to a hindrance in the farming process and adversely affecting fertilizer consumers.

Discourse/Impact: �� harvesting operations.

Pakistan has low farm yields which can be explored with structured locally based agri-value chains, expanding operational capacity and output productivity.

Discourse/Impact: Assess hindrances and collaborate with farmers for holistic solutions.

• Workforce disruptions, law-and-order challenges, and informal frictions in key trade corridors can affect distribution continuity and stakeholder trust.

�� Discourse/Impact: Advocate at the government level for the need for early warning systems and improvement of irrigation channels/ systems to reduce overflow into fertile land.
�� •

Discourse/Impact: �� management across ports and corridors.

�� cropping continuity, and local food production.

�� solutions.

Discourse/Impact: �� support soil health and broader wellbeing.

Discourse/Impact: Strengthen rapid-response farmer support and recovery mechanisms (e.g., timely access to essential inputs and advisory) to sustain livelihoods and food production after climate shocks.

Extreme weather events (e.g., floods, fog) can disrupt transport routes, warehousing, and last mile deliveries.

Discourse/Impact: Implement seasonal risk planning, resilient warehousing, buffer inventory placement, and alternate routing to safeguard supply continuity.

�� Discourse/Impact: �� recycled energy/steam use) to reduce footprint and improve competitiveness

��

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�� disadvantages.

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Discourse/Impact: Establish technological benchmarks by investing in the latest advancements and ��

• The farming industry of Pakistan falls behind in the latest practices/advancements due to a lack of awareness and conservative practices.

�� regimes and revisions in sales, income tax regulations pertaining to unregistered dealers, and other legal ��

Discourse/Impact: Educate farmers on the latest Agri technology, balanced nutrients, and modern farm practices to support improved yields. Awareness among farmers has positive sustainable consequences. • The early adoption of smart applications in the fertilizer ecosystem has transformed business operations. Discourse/Impact: Enable remote-friendly operations by streamlining processes and providing data tools for dealers to better deliver value to farmers.

Discourse/Impact: �� therefore, the company has conducted various engagement sessions with dealers across Pakistan to encourage them to register for income and sales tax to mitigate the impact of these amendments.

• Sector-wide technology adoption and innovation in emerging, climate-resilient and high-value crop value ��

Evolving provincial fertilizer regulation and enforcement frameworks can raise compliance requirements and shape market integrity through tighter quality control and clearer oversight.

Discourse/Impact: ��

Discourse/Impact: Engage proactively with regulators and strengthen compliance systems to support transparent markets, consistent quality, and institutional capacity.

�� Discourse/Impact: Increased reliance on Urea and DAP fertilizers provides an opportunity to continue �� fertilizers that can address special soil/crop needs.

Tightening environmental compliance requirements for warehousing and logistics increase audit and governance needs.

Discourse/Impact: Standardize compliance controls, documentation, and audits across the warehousing network to reduce regulatory risk.

• Water supply is attributed as a scarce resource in Pakistan, leading to a hindrance in the farming process and adversely affecting fertilizer consumers.

�� requirements.
Discourse/Impact: ��
��
Discourse/Impact: ��

• Digitization of logistics and dealer ecosystems may be constrained by low digital literacy across third party partners.

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Discourse/Impact: Invest in training, simpler tools, incentives/SLAs, and phased rollouts to accelerate adoption of tracking and portal based processes.

rooted in 63 character driven leadership

rooted in character 64 driven leadership

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engro fetilizers limited annual report 2025

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swot analysis
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•
•
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strengths
• Strong brand recognition and deep penetration within the farmer ecosystem.
•
to harvest, supported by integrated crop-solution and agronomy capabilities.
•
knowledge transfer and adoption of best practices.
•
farmer exposure to input price volatility.
•
leadership in value-added categories.
•
•
reducing environmental footprint.
• Financial sustainability with a strong balance sheet position.
•
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weaknesses
Reliance on depleting and inconsistent supply of natural resources.
Stable Urea industry limits upside potential due to swing factors.
High dependence on regulated domestic pricing, restricting margin optimization.
demand, requiring sustained investment in farmer acquisition and retention.
increasing exposure to supply-chain disruptions and international price volatility.
direct-to-farmer is underpenetrated.
Uneven field coverage in some regions can limit penetration and service consistency.
continued capacity building to drive consistent adoption versus emerging agri-tech models.
curves.
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•
human resources.
•
systems and continuous improvement.
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expansion.
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S W O T

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opportunities
Access to foreign markets, including exports of value-added agricultural inputs, driving
increased market share and contributing to the country’s foreign exchange reserves.
Growth potential in non-Urea and specialty verticals as farmer awareness and best
practices evolve.
Potential for bio-based fertilizers to cater to the growing demand for organic farming.
Enhanced capacity utilization through improvements in manufacturing and expanded
production capabilities.
Collaborating with corporate and contract farms/institutions to foster partnerships and
supply specialized fertilizers that enhance productivity.
Public–private collaboration aligned with national food security and climate adaptation
priorities can unlock scale, partnerships and policy support.
Leveraging existing networks and strategic partnerships/JVs to introduce and scale
differentiated products and services, helping de-commoditize fertilizers.
Replacing volatile imported phosphate inputs with alternative phosphate sources and
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threats
• Inconsistent gas supply and rising cost of major inputs.
•
• Long/balanced market outlook may impact offtake.
•
constrain growth.
• Currency devaluation escalating the cost of doing business.
•
•
cycles and demand.
•
responsiveness.
•
•
•
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•
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•
•
•
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rooted in
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driven leadership
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increasing localization/self-sufficiency in key raw materials.
Carbon-efficient and sustainability-linked fertilizer solutions to align with ESG
expectations and unlock new funding and market opportunities.
Potential to reduce energy costs by investing in renewable and energy-efficient
solutions.
Developing and scaling end-to-end value chain solutions for farmers, including selective
backward/forward integration where it strengthens competitiveness.
Scaling adoption of digital channels and data/AI-enabled advisory—including precision
farming solutions—to broaden reach and improve outcomes.
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disruptions—can distort demand patterns and constrain supply.
•
fertilizers.
•
increasing cost-to-serve.
•
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competitive landscape & market positioning

As a leading participant in the fertilizer sector, EFERT remains committed to delivering sustainable growth through operational excellence, continuous product development, in-depth market insights, and the cultivation of strong, long-term partnerships with farming communities and other key stakeholders.

competition in the fertilizer industry

The fertilizer industry in Pakistan comprises a diverse group of competitors operating at varying scales and under different organizational structures.

In the urea segment, competition primarily comes from other domestic manufacturers that have �� fertilizer categories, we compete with both local producers and suppliers offering imported products across a broad portfolio. Over the years, we have developed a robust and far-reaching network of dealers and warehouses nationwide. This well-established distribution infrastructure ensures consistent product availability across Pakistan and plays a critical role in enabling us to achieve our sales objectives while maintaining sustainable operations.

��

potential of new entrants in the industry

�� and the threat of new entrants is relatively low due to substantial capital requirements, the need for an established and reliable dealer network, constrained availability of indigenous natural gas, and an already competitive market landscape.

Moreover, any new entrant seeking to establish a meaningful presence must possess operational ��

power of supplier

Strong supplier relationships are integral to Engro Fertilizers’ operational excellence and �� reliable access to raw materials and capital equipment, while procurement activities are conducted by the manufacturing and commercial teams in accordance with approved planning and budgeting protocols.

Operations are further supported by long-standing arrangements for the continuous supply of ��

��

power of customer

EFERT places strong emphasis on customer relationships and is committed to earning and ��

In line with ongoing technological advancements and evolving market needs, EFERT actively incorporates customer feedback into its operations. An annual customer survey is conducted to �� enhance product offerings, and drive ongoing transformation.

threats of substitute

Although nitrogen is abundantly present in the atmosphere, only a limited proportion is naturally accessible to plants. Phosphorus is essential for supporting photosynthesis and energy transfer, �� distinct and complementary functions, these macronutrients are not substitutable.

�� product portfolio aligned with farmers’ requirements. By addressing evolving agronomic needs, �� broader nutritional demands of the economy. As technological progress continues to drive improvements in crop yields worldwide, EFERT consistently integrates innovation into its products to deliver enhanced value to the farming community.

effect of seasonality on business

�� cycles in Pakistan—Rabi (October to March) and Kharif (April to September). On average, sales volumes are higher during the Rabi season. To effectively manage these seasonal variations, the �� consistently meet customer demand throughout the year.

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urea sales (kt) urea production (kt) phosphates sales (kt)
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|||||
|---|---|---|---|
|Q1 – 2025|260|592|29|
|Q2 – 2025|431|563|66|
|Q3 – 2025|589|552|25|
|Q4 – 2025|1034|583|90|

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��

�� the date of this Report.

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how we create value

At EFERT, our purpose remains centered on converting Pakistan’s natural resources into dependable, high-quality products that strengthen the agricultural economy and support farming communities. During the year, the operating environment continued to evolve, bringing shifts in demand patterns and external pressures that influenced the broader sector. Through these changes, we remained focused on consistency, reliability, and thoughtful stewardship of our operations.

�� performance, and ensuring timely availability of essential nutrients for farmers nationwide. Ongoing engagement with stakeholders, from suppliers to retailers to growers, enabled us to better understand on-ground realities and align our commercial and operational decisions accordingly.

Innovation and continuous improvement remained integral to how we operate. Whether through optimization of resources, targeted product strategies, or enhancements in service delivery, EFERT worked to maintain the performance standards our customers rely on. This disciplined approach allowed us to stay responsive to market needs while upholding our commitment to affordability, accessibility, and quality.

As we look ahead, our long-term direction remains clear: to build on a strong foundation through responsible practices, operational resilience, and deeper collaboration across the agricultural ecosystem. With a more adaptive value chain and a sharpened focus on sustainability and community wellbeing, EFERT is positioned to continue creating enduring value for farmers, shareholders, and the communities connected to our work.

outcomes

Upstream value Suppliers of natural gas and packaging material chain �� products for our value chain Research and development partner �� Engro Fertilizers Manufacturing Limited ��

��

outcomes

Distribution

Downstream value chain �� • Wide distribution network throughout the country to improve the availability of our brand at all purchase points.
�� providing value to our consumers.

Consumers

��

�� during the year.
�� consumer satisfaction every year.

Stakeholders Value is created for our stakeholders through �� sustainability	�� �� �� �� �� �� �� • Wealth generated Rs. 82 Bn • On group engagements with our stakeholder
Community �� contributing to the community's �� �� operations	�� �� �� �� � Community investment and infrastructure development � �� � ��

��
Transportation ��
Robust setup of transportation channels over the country for timely distribution.

Warehousing

90+ selling locations to better serve our customers

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stakeholder engagement

�� key component of its corporate responsibility. It believes that upholding the highest ethical standards helps build trust. We recognize that effective stakeholder engagement supports value �� value chain

�� Oversight that are responsible for monitoring performance on social and environmental matters and for guiding the outcomes of engagements with various stakeholders.

Our stakeholder engagement approach focuses on �� considering those groups or individuals who may be substantially affected by our business activities, outputs, or outcomes, as well as those whose actions could meaningfully influence our ability to create value over time. These stakeholders are �� based on factors such as influence, responsibility, proximity, dependency, willingness to engage, and representation. We engage with our stakeholders on an ongoing basis through the relevant departments.

�� through its meetings, and key developments from these meetings are reported to the Board by the �� part of its corporate plan review process, the Board �� group reporting framework that requires the �� developments to its parent company, Engro �� discussions and engagements with stakeholders

�� environmental topics EFERT engages with key stakeholders and consults with them on all material topics in relation to its long-term strategy of ensuring sustainable operations. The purpose of these engagements is to:

�� discussions and engagements with stakeholders.

Build knowledge and develop relations.
Align understanding on their needs and expectations.

The consultation and engagement strategy with each stakeholder is covered in more detail on the pages that follow.

Identify and track perceptions and feedback on outcomes; and
�� developments.

EFERT is represented at various global and local forums and partnerships and maintains active membership in industry associations and other relevant organizations. Please refer to our ��

�� stakeholders through periodic discussions and meetings. All aspects of engagement are covered during these interactions. Minutes of these discussions are maintained by the respective division heads, who also share summaries in the ��

platforms to invite open feedback and recommendations from our stakeholders

��

�� various forums to facilitate them. Our investor relations department manages all concerns received from shareholders via letters or emails. Similarly, the customer and supplier helplines encourage feedback from suppliers or customers to be appropriately captured. There is an independent whistleblower hotline that ensures complete transparency over any concerns �� taken as required.

stakeholder engagement strategy

�� the strategy are reported below.

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stakeholders frequency of engagement
�� Regularly
�� Regularly
Employees Regularly
�� Regularly
Regulators Regularly
�� Regularly
�� Quarterly
�� Occasionally
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Customers and Suppliers

engagement process Periodic formal and informal meetings, conferences, and business support services, including visits, regular meetings, emails, ��

effect and value Our continuous engagement enables us to understand our customer and supplier needs and develop the right products for them actions taken We continue to focus on various customer and supplier engagement initiatives, including regular meetings, visits, providing technical assistance, etc.

�� ensures continuous and proactive engagement with suppliers on all gas regulatory matters, including taxes and levies in relation to gas. Also, it collaborates with the gas supplier on issues of gas availability in the country. Refer to the customer engagement section in this report for further details with respect to customers.

Shareholders

engagement process

��

�� Effect and value

��

�� hotline to maintain healthy investor relations and timely responding to shareholder queries.

actions taken

�� address their concerns in a broader forum, and provide updates on the Company’s performance and activities. During these meetings, board members, and senior management were also available to answer investors’ and analysts’ questions.

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Investment Community/Analyst

engagement process

��

effect and value

�� Attends to analysts’ concerns by responding to various queries and clarifying Company’s position. Provides feedback on planned developments and makes suggestions to improve the process going forward.

actions taken

��

Regulators

engagement process

�� division to manage engagements with government and regulatory bodies.

effect and value

Ensure all legal and regulatory requirements are complied with. Ensure continuation of the common objective of the government and the Company to transform the agriculture landscape of Pakistan.

actions taken

��
��
�� ministries on various policy matters.

Employees

engagement process

�� including corporate retreats, ��

effect and value

Helps in focusing on increased employee satisfaction, implementing diversity and inclusion initiatives, resulting in improved performances.

actions taken

Pulse surveys conducted to engage employees and to look out for their emotional and physical wellbeing.

�� Please refer to the People section in this report for further details.

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Bank/Lenders

engagement process

��
��

effect and value

�� company.

actions taken

��
��

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Local Communities

engagement process

��

effect and value

��
��

actions taken

Various initiatives were undertaken during the year for our local communities by the Company and its employees. ��

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Media
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engagement process

�� activities.

effect and value

Effective awareness is created regarding the company and the products and services offered indirectly having a positive impact.

actions taken

��

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corporate governance rooted in 423 character driven leadership

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our governance framework

We are committed to implementing sound corporate governance practices that enhance the effectiveness of our board and management while engaging with our shareholders on matters of corporate governance.

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board structure & governance

director elections

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director participation

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key stakeholders engagement

board composition

board composition and attendance

The Board of Directors held 5 meetings to cover its complete cycle of activities. The attendance record of the Directors is as follows:

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Mr. Ahsan Zafar Syed Non-Executive Director-Chairman 4/5
Mr. Farooq Barkat Ali Non-Executive Director 4/5
Mr. Ahmad Shakoor Non-Executive Director 5/5
Mr. Asad Said Jafar* Non-Executive Director 5/5
Mr. Mohammad Younus Dagha* Independent Director 3/5
Mr. Rizwan Khalil Sheikh Independent Director 3/5
Ms. Sadia Khan * Independent Director 3/5
Mr. Ali Rathore �� 5/5
Mr. Asim Murtaza Khan Independent Director 2/5
Mr. Javed Akbar Non-Executive Director 2/5
Ms. Danish Zuberi Independent Director 1/5
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Retired as Independent Director on March 24, 2025.
Retired as Non-Executive Director on March 24, 2025.
**
Retired as Independent Director on March 24, 2025
Mr. Mohammad Younus Dagha was Elected as Independent Director on March 24, 2025. Mr. Rizwan Khalil Shaikh was Elected as Independent Directors on March 24, 2025.
Ms. Sadia Khan was Elected as Independent Directors on March 24, 2025.
Mr. Asad Said Jafar Retired as Independent Director on March 24, 2025 and was elected as Non-Executive Director on March 24, 2025.

board committees

Our governance framework is designed to ensure that the company lives up to its core values and principles, institutionalizing EFERT’s commitment to enabling excellence in everything we do.

corporate social responsibility

ethical compliance & whistle blowing system

the board has established the following two committees:

board people committee (BPC)

The Committee meets several times during the year to approve, review and recommend all elements of the Compensation, Organization and Employee Development policies relating to the senior executive’s remuneration and to approve all matters related to the remuneration of the executives of the company and members of the management committee. The Chief Executive ��

current members:

Mr. Rizwan Khalil Sheikh-Chairman Mr. Asad Said Jafar Ms. Sadia Khan

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salient features of terms of reference

To ensure corporate standards / human resource policies and fundamental beliefs are aligned with the corporate guidelines.
To recommend the selection, performance evaluation, compensation, development and succession plan of the CEO and his direct reports
Recommend the salary and bonus programme to the Board.
Review engagement survey results

board audit & risk committee (BARC)

�� shareholders, systems of internal control and risk management and the audit process. It has the power to call for information from management and to consult directly with the external auditors or their advisors as considered appropriate.

��

Current members

Mr. Mohammad Younus Dagha-Chairman Mr. Farooq Barkat Ali Mr. Asad Said Jafar

salient features of terms of reference

To recommend to the Board the appointment and removal of external auditors
��
To review the internal control systems and internal audit function
To review the enterprise risk management system and assess the adequacy and monitoring of the same by the management.
To monitor management’s compliance with all Company policies including complaints received through the Speak Out – Whistle Blower policy
To monitor compliance with statutory requirements

board of directors

The Board of Directors carries out its duties with a sense of objective judgment and in good faith in the best interests of the Company and its stakeholders. There are eight (8) numbers of Directors on the Board, comprising three (3) Independent Directors, four (4) Non-Executive ��

chief executive officer

The Board collectively has the responsibility for ensuring that the affairs of the Company are governed competently and with integrity. Biographical details of all the Directors are given in the previous section.

In compliance with best practices of corporate governance, the positions of the Chairman of the �� Zafar Syed, Non-Executive Director, is the Chairman of the Board and Mr. Ali Rathore is the Chief �� Rathore serves as a Director on the Boards of:

��

role of the highest governance body in overseeing the management of impacts

The Board meets at least quarterly to assess the performance of the Company, roles and responsibilities of the Board can be referred from the Chairman’s letter to directors, shared in the Annual Report 2025.

the role of the highest governance body in reviewing the effectiveness of the organization's processes and reporting the frequency of this review.

�� quarter, please refer to BARC TORs for details.

board nomination and selection

selection of independent directors

�� except for providing access to the database on independent directors besides Directors’ training and evaluation of Board and/or individual Directors’ performance.

external consultancy for appointment of the chairman

No external search consultancy has been used in the appointment of the Chairman or Non-Executive Directors.

directors’ orientation program

The Chairman had communicated in detail the duties, roles and responsibilities, powers, term of �� Company and the Code of Corporate Governance Regulation, 2019.

The human resource department outlines a formal orientation plan, which is followed at the time of induction of a new Board member. The orientation is presented to bring the new Board member up to speed with the company and its activities. Divisional heads take them through a presentation about macro-level policies related to their respective divisions.

directors’ training

The Board ensures that all its Directors have duly completed the Directors’ Training program from �� Directors, Mr. Ali Rathore, Mr. Farooq Barkat Ali, and Mr. Rizwan Khalil Sheikh attended the ��

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board meetings held outside of Pakistan

��

chairman of the board

Mr. Ahsan Zafar Syed is the Chairman of the Board. In compliance with best practices of �� the Chief Executive are held by separate people.

leading from the front: role of the chairman of the board

Every meeting of the Board is presided over by a Chairman. The chairman of a Board meeting by virtue of his position and nature of his duties is responsible for the leadership of the board and to �� things, he is empowered to:

�� and the recommendations of any technical or executive sub-committee of the Board that may be set up for the purpose.
Review and approval of related party transactions.
Appointment, removal, remuneration, terms and conditions of employment of Chief
��
Constitution of committees and appointment of Committee Chairs and approving their terms of reference.
Governance of risk and determining Company’s level of risk tolerance including annual review.
��
��
Code of Code of Corporate Governance Regulations, 2019, as and when applicable.

matters delegated to the management

issue a letter to Directors setting out their roles, obligations, powers and responsibilities at the beginning of the term of each Director
set the agenda of the meeting of the Board and ensure that reasonable time is available for discussion of the same.
ensure that the minutes of meetings of the Board of Directors are kept in accordance with the ��

chairman’s significant commitments

�� several other companies. The details of his other engagements as Director and Trustee are given ��

delegation of responsibilities

matters decided and delegated by the board of directors

�� .

This policy establishes:

�� • Matters delegated to the management to empower it to act effectively and make key decisions

�� Code of Corporate Governance Regulations, 2019 and the Articles of Association of the Company.

In addition to approving the vision, core values, corporate strategy and the policies for conduct of ��

�� Company who has the primary responsibility for routine business operations of the Company. The authorities necessary for the day to day management of the organization and the implementation of corporate objectives have been delegated to management of the Company ��

collective knowledge of the highest governance body

The Board is routinely informed and upskilled on relevant and pressing matters to the company, including those related to sustainability. During 2025, the Board has briefed external consultants on sustainability-related matters.

conflict of interest among board members

A formal code of conduct is in place that promotes an ethical culture in the company and prevents conflict of interest in the capacity as a member of the board. Further, the Board of �� Regulations, 2019 and the ‘Corporate and Financial Reporting Framework’ of the Securities and ��

Duty not to place themselves in a position of conflict between their personal interests and those of the company – this includes the duty to disclose any such personal interests to the �� the Company.
Duty not to act on behalf of the Company in any matter in which they have an interest that conflicts, or may conflict, with their duties.
The Directors of the Company excuse themselves from the meetings when the matters under discussion involve a conflict or potential conflict of interest with the activities of any ��

communication of critical concern

Critical concerns are reported to the Board primarily through board meetings.

Investment and disinvestment of funds where the maturity period of such investments is six months or more.
�� monetary limit thereof.

rooted in 81 character driven leadership

rooted in character 82 driven leadership

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board evaluation

performance evaluation of directors

The Board has developed a formal mechanism for evaluation of the board’s own performance, members of the board and of its committees. The assessment was carried out four times in the current year and the results/feedback were evaluated to bring improvement in the evaluation process. The performance evaluation focuses on:

Clarity of agenda and objectives.
��
Quality and diversity of discussions:
Clarity of decisions and outcomes.
��
Overall satisfaction

performance evaluation of CEO

�� bound objectives. Furthermore, the performance of the CEO is also gauged by analyzing core competencies exhibited in achieving the objectives.

retention of board fee

CEO is a deemed director on EFERT’s Board and holds the position as non–executive director on the Boards of various other companies. Fees paid by these companies are in line with their respective policies as approved by their Boards of Directors. EFERT does not have any policy that restricts an executive director from retaining the meeting fee earned by them against services as a non-executive director in other companies.

evaluation of the performance of the highest governance body

The feedback provided by the Board is intended for internal management use and primarily pertains to the conduct of the meeting and the quality of information presented to assist the Board in making crucial decisions.

remuneration policy – senior management

��

For information on remuneration of Directors and CEO in 2025, please refer to the consolidated ��

annual total compensation ratio

�� EFERT does not report these ratios.

governance in relation to sustainable value creation

corporate governance

EFERT continues to improve its governance structure by institutionalizing its core ideals, �� The guiding pillars of our corporate governance are the internally developed code of conduct, policy statements of ethics and business statement, code of corporate governance and best available practices.

Extensive information regarding the code of conduct and related matters can be found in the Corporate Annual Report 2025.

Board structure and governance
Key stakeholder engagement
Corporate responsibility
��
Social and environmental responsibility

director’s remuneration

The Board of Directors have approved a formal policy which set out the requirements and methodology for determining the remuneration for Non-Executive Directors including Independent Directors of the Company.

The policy entails:

The remuneration shall be appropriate and commensurate with the level of responsibility and expertise of the Directors.
It shall be aimed at attracting and retaining the Directors needed to govern the Company successfully and to encourage value addition.
It shall not be at a level that could be perceived to compromise or influence in any way the independence of the Director.
No Director shall determine his/her own remuneration nor of a Director who may be a related party.
�� Non-Executive Directors who are employees in other Engro entities, for attending meetings of ��
The Board, if deems appropriate, may engage an independent consultant to determine the appropriate level of remuneration of its Directors and recommend it to the Board for consideration and approval.

key board policies in relation to governance over sustainable value creation

�� critical in order to survive in the global marketplace. To this end, the Board of Directors have adopted a host of policies which sets the standard for conduct.

review of the company’s performance by the board and its own performance evaluation

The Board has also developed a formal mechanism for evaluation of board’s own performance, members of board and of its committees. The assessment is carried out on quarterly basis and was done four times during the current year. The Board carries out self-assessment evaluating �� respect to economic, environmental, and social topics.

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group policy governing philanthropic contributions and charitable donations by engro corporation or engro holdings limited and its affiliates

The policy provides guidelines for philanthropic contributions and charitable donations made by �� contributions. As part of this policy, EFERT is committed to creating sustainable prosperity that �� on the principle of Inclusive Business and Strategic Community Investment. EFERT looks to connect the underprivileged, youth and women in its value chains for sustainable impact. Where inclusive opportunities are limited or not relevant, EFERT looks to invest in strategic community initiatives.

risk management process

All activities undertaken by a business entity carry an element of risk which are managed through the Enterprise Risk Management (ERM). It is the policy of the Company to view ERM as integral to the creation, protection, and enhancement of shareholder’s value by managing the uncertainties that could influence the achievement of corporate goals and objectives. To achieve this, an appropriate framework is adopted by the management and approved by the Board. Detail on the Company’s ERM program is mentioned in the risk management portion of this Report.

key stakeholder engagement

The policy aims to develop and maintain trustworthy relations with shareholders and investors. The investors’ relations section on the Company’s website (www.engrofertilizers.com) is updated �� investor information and other requisite information. The Company’s website, maintained in �� Continuing with its policy of promoting transparency and stakeholder engagement, the Company ��

policy for procurement of goods and services

The aim of our procurement policy is to obtain sustainable competitive advantage through �� and controls. This policy establishes a foundation for our discipline and serve as guidelines in our daily activities as we interact with external suppliers and service providers.

policy for safety records of the company

�� applicable regulatory requirements. In addition, EFERT has a business continuity plan complemented by a disaster recovery plan to ensure uninterrupted operations.

investors’ grievance policy

The Company strives to develop and maintain trustworthy relations with all its stakeholders, including shareholders and investors. It recognizes the importance of timely and fair disclosure of all material information to them, without advantage to any investor, group or investment advisor / analyst, in order to enable them to make informed decisions about investing in the Company.

The Company’s contact details are disclosed in “Company Information” section of this annual report and on it’s website under “Investors relation” section to facilitate shareholders / other investors’ and timely resolve their complaints, if any.

disaster recovery and business continuity planning

�� for the Company. It also provides policies and procedures whereby the critical business processes can be restored in a timely and orderly manner and can be operated on an interim basis, thereby helping to ensure that all critical business functions continue in the case of a disruption or disaster. This plan is carefully followed during periodic testing exercises to thoroughly train recovery personnel and ensure that strategies and actions accurately reflect current business recovery requirements.

whistleblower policy – “speak out”

The Board of Directors of the Company have established a Whistleblower policy which allows employees, suppliers, customers and contractors to speak out through the whistleblower channel about any concerns they have regarding business ethics, safety, environmental performance, harassment and other employment-related matters or other possible breaches of �� (BARC).

human resource management

Appropriate policies are in place to attract, induct, develop, retain, and motivate high caliber talent �� objectives with increasing emphasis on equal opportunity, training and development, performance ��

social and environmental responsibility policy

The Company believes that businesses, in their normal course of operations, create positive and adverse impacts. The policy aims to build on Company’s commitment to manage and improve social and environmental impacts of its operations on the lives of its customers, suppliers, and communities at large.

corporate tax strategy

�� its long-term business strategy. The corporate tax strategy is governed by the following principles:

Ensuring high level of tax compliance in every jurisdiction where the Company has operations
Making material business decisions after taking into account optimized tax solutions
��
Developing and fostering open, honest and good working relationships with tax authorities
and undertaking all dealings in a professional, courteous and timely manner
Ensuring open communication channels within Engro group to encourage smooth flow of information

rooted in 85 character driven leadership

rooted in character 86 driven leadership

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annual report 2025

IT governance and cybersecurity policy

Information Technology (IT) Governance is an integral part of enterprise governance and consists of the leadership, organizational structures, and processes. IT Governance aims to ensure that IT activities are aligned with business objectives and that stakeholder requirements of value delivery, risk optimization, and resource optimization are address.

role of the chief executive officer (CEO)

Roles and responsibilities of the Company’s CEO are duly assigned by the Board of Directors of �� Company and amongst other things, he is empowered to:

enter any trade contracts on behalf of the Company in the ordinary way of business
• to do all other acts and things in the ordinary course of business which he may consider necessary or conducive to the interests of the Company.

corporate HSE committee

�� Environment.

Members:

Mr. Ali Rathore – Chairman
Mr. Aneeq Ahmed – Co-Chairman
Mr. M. Imran Khalil – Member
Mr. Atif M. Ali – Member
Mr. Farrukh Saeed Khan – Member
Mr. Mahmood Siddqui – On Invitation
Mr. Tariq Raza – On Invitation

��

sustainability reporting committee

management committees

functional committees

These committees act at the operational level in an advisory capacity to the Chief Executive ��

management committee

�� heads of all departments. The committee meets to discuss the Company’s performance and ��

Members:

Recently, sustainability reporting committee has been formed which will provide strategic leadership for the sustainability report, ensuring the report’s accuracy, integrity and transparency. The committee will oversee the directions and governance of the reporting process. This approach will ensure high quality reporting that fully represents our sustainability commitment, performance and progress

Members:

��
Ms. Gull Zareen Khan - Member
Mr. Anees Amin - Member
��
Mr. Ali Raza Sani - Member
Mr. Ali Rathore – Chairman
Mr. Aneeq Ahmed – Member

The Secretary of the sustainability reporting committee is Mrs. Sara Riaz

Mr. Muhammad Imran Khalil – Member
Mr. Atif Mohammad Ali – Member
Mr. Bilal Mustafa – Member
Ms. Nazia Ali – Member
Mr. Farrukh Saeed Khan – Member

��

pricing committee

This committee is responsible for overseeing and approving product pricing strategies including ��

Members:

Mr. Ali Rathore – Chairman
Mr. Atif Mohammad Ali – Member
Mr. Muhammad Imran Khalil – Member

��

rooted in 87 character driven leadership

rooted in character 88 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

internal control framework

responsibility

The Board is ultimately responsible to ensure that a system of sound internal control is established, which is effectively implemented and maintained at all levels within the Company. �� business objectives. The Board, whilst maintaining its overall responsibility for the governance of risk within the Company, has delegated the detailed design and operation of the system of internal controls to the Chief Executive.

framework

The Company maintains an established control framework comprising clear structures, authority limits, and accountabilities, well-communicated and understood policies and procedures and budgeting for review processes. All policies and control procedures are documented in manuals. The Board establishes the overall corporate strategy and the Company’s business objectives. Divisional management integrates these objectives into divisional business strategies with ��

review

�� expenditure proposals and other key performance indicators. The Board Audit Committee �� auditors and reviews the process for monitoring the effectiveness of internal controls.

There is a Company-wide policy governing the appraisal and approval of investment expenditures �� expenditures.

risk management process

All activities undertaken by a business entity carry an element of risk. At EFERT, the exposure to these risks is managed through the practice of Enterprise Risk Management (ERM). The purpose ��

It is the policy of the Company to view ERM as integral to the creation, protection and enhancement of shareholder’s value by managing the uncertainties that could influence the achievement of corporate goals and objectives. To achieve this, an appropriate framework is adopted by the management and approved by the Board. Detail on the Company’s ERM program is mentioned in the risk and opportunities section of this annual report.

responsibility for statutory financial statements

In accordance with the requirement of the applicable regulatory framework, CEO and CFO �� statements that are free from material misstatement, whether due to fraud or error.

��

�� December 31, 2025 have been audited by the External Auditors and recommended by the Board in its meeting held on February 11, 2026 for shareholders’ approval in the Annual General Meeting to be held on March 25, 2026.

�� conformity with the applicable regulatory requirements.

timely communication of financial statements authorization

�� February 11, 2026.

governance over related party transactions

The Board has approved a formal documented policy for governance over transactions between �� and reporting of related party transactions. This policy is intended to ensure due and timely approval, disclosure and reporting of transactions between the Company and any of its related parties in compliance with the applicable laws.

The said policy:

��
��
��
��

During the year, no contracts or arrangements with the related party were entered into other than in the ordinary course of business on an arm’s length basis. Names of related parties in ��

beneficial (including indirect) ownership and flow chart of group shareholding

Complete disclosure of EFERT’s shareholders has been provided in pattern of shareholding of our �� demonstrated within the Company’s organogram.

annual general meeting – update of last AGM, decisions taken and their implementation status

The Company’s last Annual General Meeting (AGM) was held on March 24, 2025, which was attended by the Chairman of the Board, Chairman of Board Audit Committee, Chief Executive �� sought by the Board of Directors.

rooted in 89 character driven leadership

rooted in character 90 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

business expansion and rationale of major capital expenditure projects

�� budgeted cost comparison, expected completion timelines and overruns, if any thereby ensuring timely and authorized business expansion in line with EFERT’s strategy. Further details are available in the performance review section of this report.

compliance statement

�� Governance) Regulations, 2019 and the ‘Corporate and Financial Reporting Framework’ of the ��

state-of-the-art ERP systems the heart of digitization at EFERT

�� continuous enhancement and governance. The Company remains committed to strengthening system integrity, improving user experience, and leveraging data intelligence to drive operational excellence.

A structured annual authorization and access control review is conducted to ensure that user roles and system access rights remain aligned with job responsibilities and internal control requirements. This periodic exercise reinforces segregation of duties, mitigates operational risks, and ensures compliance with governance standards.

�� and system transactions are being utilized across departments. Frequently used functions are �� by targeted awareness sessions and capability-building initiatives.

�� environment remains secure, optimized, and aligned with evolving business requirements. Through this ongoing improvement framework, EFERT continues to maximize the value derived from its digital investments while maintaining strong governance and operational transparency.

diversity

�� employees irrespective of cast, religion, and gender. EFERT is proud to embrace diversity in the form of age, gender, ethnicity, physical and mental ability. To encourage gender diversity at all �� performance and updates under this UNSDG. To proactively infuse the concept of diversity and promote an encouraging environment, a 3-point framework for gender diversity and various gender sensitization sessions have been conducted. Furthermore, during the year, EFERT led the industry in its gender diversity drive by opening avenues to women from various socio-economic backgrounds to work with the Company in different unconventional roles such as Trade ��

human resource management policies including preparation of a succession plan

�� contribute their best towards the accomplishment of Company objectives.

EFERT’s Board places great emphasis on people’s development and related policies. With this at the heart of our core values, we developed leadership competencies. To ensure a dedicated focus �� responsible for performance evaluation, development and succession planning.

employee health, safety and protection

The safety of employees has always been the foremost priority of the Company. A ��

safety of records of the company

�� applicable regulatory requirements.

�� critical electronic, hard copy data and processes to ensure all critical functions continue in case of a disruption or disaster. The Company has dedicated offsite facilities which serve as data-back-up centers.

investors’ grievance policy

As Company strives to develop and maintain trustworthy relations with all its stakeholders, the board in order to ensure this has a dedicated investor grievance policy for its shareholders and investors. It recognizes the importance of timely and fair disclosure of all material information to them, without advantage to any investor, group, or investment advisor/analyst, in order to enable them to make informed decisions about investing in the Company.

external oversight

�� statements. Furthermore, the Company has engaged third party for actuarial valuation.

communication with stakeholders

The Directors regard stakeholder engagement as an important element of the Company’s corporate responsibility. Further details are available stakeholders information.

social and environmental responsibility

�� is critical in order to survive in the global marketplace. To this end, the Board of Directors has adopted a host of policies that sets the standard for conduct.

governance practices at EFERT other than legal requirements

At EFERT we strive to work in a responsible and ethical manner. To ensure transparency EFERT has institutionalized the following practices:

rooted in 91 character driven leadership

rooted in character 92 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

��
A stringent insider trading policy that goes beyond the legal requirement.
��
Implementation of health, safety, and environmental policy as a responsibility of our commitment to protect our people, community, and environment.
Undertaking several health and training initiatives for improving the livelihood of the surrounding community.

ensuring excellence in corporate governance practices

�� governance framework by institutionalizing its core values, policies, and principles across the board to surpass the legal requirements and adhere to global best practices and standards of governance.

Following additional governance practices implemented by the management include:

�� Company’s affairs more transparent and to give better insight of the Company’s affairs, policies, and strategies.
�� environment for employees, workers and surrounding community.
Implementation of various social projects for welfare of the community as part of its Corporate Social Responsibility (CSR).
Adoption of a strict insider trading policy whereby all employees of the Company are restricted from trading in shares of the Company.
Restriction of employees of group companies to adhere to close period requirements.
The Directors of the company have attended Directors’ training program as per the legal requirement prescribed by the Code of Corporate Governance Regulations, 2019. The Company endeavors to replicate the best practices in its privately owned subsidiaries.

internal audit, ethics and compliance

internal audit

�� mechanisms of the Internal audit personnels are appropriate to maintain their independence from the Company’s management.

��

EFERT has an internal system of voluntary reporting called “Irregularity reporting” that allows employees to voluntary disclose actual or suspected non-compliance through the Irregularity Reporting system. Employees are encouraged to raise red flags and help strengthen the control environment.

�� quarterly basis. Whistleblower complaints and results of their investigations are also reported to �� business practices review involving all Engro companies and employees to identify �� Directors. A total of 12 irregularities were reported in FY 2025 as against 10 irregularities in FY 2024.

ethics & compliance

1. statement of ethics

The Company ensures that its business is conducted in compliance with the highest ethical standards of business practice and in compliance with all relevant legal principles. We commit to upholding the highest standards of integrity above and beyond legal requirements where applicable.

rooted in 93 character driven leadership

rooted in character 94 driven leadership

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annual report 2025

ICT governance

��

board responsibility statement

As the Company embarks on its digitization journey, we recognize the importance of having a �� formulated the IT governance policy and ensure to keep it updated and implemented.

IT governance policy

The IT governance policy is designed to ensure that IT activities are aligned with business �� resource optimization have been initiated under this policy.

oversight function

The IT/IS Steering committee is responsible for overseeing and monitoring the implementation of the Enterprise IT Governance Framework (EITGF) and Cybersecurity initiatives, strategy, and related matters throughout the enterprise.

disaster recovery plan and it personnel training

The company has a documented disaster recovery plan entailing the relevant recovery strategies. The plan is executed each year. Apart from disaster mitigation this also helps in training IT recovery personnel. No major weaknesses were noted in the last disaster recovery exercise during the year.

digitally enabled & ai-powered commercial & supply chain operations

Engro Fertilizers scaled Markaz, its network of digitally enabled retail centers strategically located �� for farmers.

In parallel, to further enhance B2C engagement, Engro initiated the development of UgAi 2.0, an upgraded platform featuring a modern interface, improved navigation, and advanced capabilities designed to elevate the farmer experience.

Together, these initiatives underscore Engro Fertilizers’ continued progress in evolving from a dealer-centric model to one that engages directly with farmers—advancing the company’s long-term ambition of building a more connected, empowered, and digitally enabled farming community.

smart FFM: advancing efert’s digital field operations

In 2025, EFERT launched its new Smart Field Force Management (Smart FFM) Solution, replacing the legacy FFM application as part of the company’s ongoing digital transformation. �� EFERT’s connection with dealers and farmers.

The Smart FFM Solution introduces intelligent journey planning, structured dealer and farmer �� activities. It also integrates seamlessly with enterprise systems and provides enhanced analytics for informed decision making.

�� forward in the company’s digital journey.

humsafar

�� agility, scalability, and security. The upgraded platform now offers a modular and future-ready design, enabling faster enhancements, improved system reliability, and stronger security and authorization controls, while ensuring uninterrupted business operations.

�� data trails, strengthening transaction visibility, auditability, and issue resolution. This modernization has accelerated digital adoption across the dealer ecosystem, with online dealer �� transformation and operational excellence.

strengthening market reach through digital B2C engagement

As Engro Fertilizers advances its transition from a traditional B2B operating model toward a more �� engagement with farmers and enhancing last-mile delivery across the agricultural value chain.

democratizing AI at engro

Engro accelerated its AI transformation journey by rolling out Microsoft 365 Copilot across the organization, embedding AI capabilities into everyday business processes. This initiative introduced advanced AI tools to automate routine tasks, generate content, and analyses data, all while ensuring secure and compliant usage. By democratizing AI and integrating Copilot into core operations, Engro empowered employees to enhance productivity and make faster, data-driven decisions, fostering innovation and reinforcing its commitment to operational excellence and sustainable growth.

AI-powered safety management

�� questions and receive instant responses from the company’s safety documentation, eliminating �� boosting overall productivity.

rooted in 97 character driven leadership

rooted in character 98 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

future proof foundation

cloud computing

�� such as AWS and Azure to enhance resilience, scalability, and innovation. Core enterprise �� delivered through the cloud, strengthening operational reliability and business resilience.

Several workloads have already been successfully migrated to AWS, with a standardized AWS technology stack enabled to support faster innovation, improved business agility, and optimized �� platforms, enabling quicker delivery of digital solutions and establishing a centralized cloud Data ��

cyber risk management and security operations

Security Operations Center (SOC) - Early Warning System: Company SOC serves as a central hub for monitoring, detecting, and responding to cyber threats. It safeguards Engro’s digital presence across the web, ensuring the organization remains resilient against evolving cyber risks. Additionally, the SOC functions as an early warning system, proactively identifying, assessing, and addressing potential cyber risks. This system ensures timely disclosures and communication to the Board regarding cybersecurity incidents.

digital risk & brand protection

�� This initiative proactively monitors, analyzes, and mitigates cyber risks, including brand impersonation, fraudulent mobile apps, social media scams, and data breaches across web domains.

penetration testing & vulnerability assessments

platforms modernization

�� data lake. These advancements position Engro to seamlessly leverage cutting-edge, AI-powered solutions across all businesses and value streams.

information security at engro

As EFERT continues to advance its digitization journey, we recognize the importance of having �� governance, InfoSec leadership, InfoSec strategy implementation, security frameworks and processes.

The Company’s Information Security Division has formally documented a comprehensive set of information security policies covering 13 domains along with a user level Information Security �� address cybersecurity in the industrial environment. Both sets of policies are aligned with leading industry standards and tailored to the organization’s needs. The policies have been formally approved by leadership of the Company and undergo periodic reviews to ensure continued relevance and effectiveness.

A specialized unit within the Information Security division conducts penetration testing for new applications and performs vulnerability assessments on servers and network devices to enhance the company’s security posture.

operation technology (ot) cyber security assessments

Various cybersecurity assessments related to Operational Technology (OT) have been conducted across multiple subsidiaries. These assessments encompass compliance evaluations based on international/local standards and regulatory requirements.

cybersecurity awareness & training

Information Security Awareness Training: Conducted regularly through digital learning tools
to equip employees with knowledge on cyber threats and security best practices.
��
readiness and resilience against phishing attacks.
Information Security Awareness Month: A dedicated month-long campaign featuring interactive workplace activities, conducted in both English and Urdu to cater to a diverse audience.
�� virtually and physically to educate employees and senior management about emerging cyber threats and secure practices.

board oversight and governance

Information security is recognized as a key business risk and is integrated into the organization's risk management framework. The Board of Directors plays an active role in overseeing �� structured manner. A board-level committee has been established to oversee InfoSec governance and cybersecurity risk management. This committee provides strategic direction, evaluates cybersecurity policies, and ensures regulatory compliance.

Furthermore, the Board has incorporated cybersecurity into its risk oversight function, engaging with executive management to ensure that robust security measures are in place. Regular cybersecurity reports are shared with the Board to maintain transparency and facilitate informed decision-making.

rooted in 99 character driven leadership

rooted in character 100 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

enterprise risk management

In ensuring long term shareholder wealth creation, EFERT is cognizant of the importance of identifying, monitoring and timely addressing the risks and capitalizing on the opportunities �� effective strategies.

�� deliver on strategic priorities and, ultimately, to create shareholder value.

risk governance: policy and oversight

The overall responsibility for establishing and monitoring an enterprise-wide risk management system lies with the Board of Directors. The Board ensures that the Company has a robust process in place for assessment of principal risks, including those that would threaten the business model, future performance, solvency or liquidity etc.This is done through a meticulously created risk management framework approved by EFERT’s Board which describes the risk �� compliance risks. Exposure to these risks is managed through the Enterprise Risk Management �� managing the impact of these risks, as well as the mechanisms to effectively monitor and �� enhancement of shareholders’ value by managing the uncertainties that could influence the achievement of corporate goals and objectives.

enterprise risk management process

Engro Fertilizers has implemented an Enterprise Risk Management (ERM) methodology which provides a structured, disciplined and consistent approach to risk management that facilitates �� process to assess its risks and material issues:

Risk is considered to be integral part of the Organization’s culture and therefore appropriate consideration is given to risk management during business planning processes and decision making. In this regard, the Board of directors ensures that appropriate focus is given to risk �� Committee for its review on a half yearly basis.

formulation of strategy and business objectives

At Engro Fertilizers the focus of ERM is to ensure achievement of the organization short term �� objectives is pre-requisite to identifying risks and opportunities. During this step, the ��

identification of risks and opportunities

The purpose of this step is to identify a comprehensive list of risks and events that may potentially impact the achievement of an organization’s overall mission, its strategic objectives and its long-term sustainability and growth. In order to identify enterprise-level risks to be managed, a structured and systematic “Enterprise Risk Register” is used.

Broad types of risk which are used for categorization of risk and opportunities are as follows:

strategic risk

Strategic risks are mostly external, associated with operating in a particular industry and are mostly beyond Company’s control and are also created by the Company’s strategic objectives and business strategy decisions that could affect its long-term positioning and performance. The Board of Directors actively oversees the management of these risks and devises mitigating strategies wherever required.

compliance risk

These risks emanate uncertain future events that could impact the legal or regulatory landscape of the Company. Engro Fertilizer closely monitors and ensures absolute compliance with all regulatory matters including but not limited to those pertaining to the Companies Act, Income Tax Ordinance, Sales Tax Act etc.

operational risk

These are risks associated with internal factors, administrative and operational procedures like employee turnover, supply chain disruption, IT system shutdowns or control failures.

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Formulation of Strategy enterprise Risk
and Business Objectives risk Assessment
management
process
��
and Opportunities Risks
Monitoring and Implement Risk
Reporting Response
.
----- End of picture text -----

financial risk

�� risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk. The �� shareholders.

i. Market risk – currency risk; interest rate risk

�� fluctuate because of changes in foreign exchange rates. This exists due to the Company's exposure resulting from outstanding import payments, and related interest payments. The policy �� open exposures are rigorously monitored. The Company ensures to the extent possible that it has options available to manage exposure, either through forward contracts, options or prepayments, etc. subject to the prevailing foreign exchange regulations.

rooted in 101 character driven leadership

rooted in character 102 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

�� will fluctuate because of changes in market interest rates. The Company's interest rate risk arises from long-term borrowings and short-term investments. Borrowings are benchmarked to variable rates which expose the Company to cash flow interest rate risk. The Company analyses its interest rate exposure on a regular basis by monitoring interest rate trends to determine whether they should enter into hedging alternatives.

ii. Credit risk

�� loans, advances, deposits, bank guarantees and other receivables. The Company maintains an internal policy to place funds with commercial banks and mutual funds of asset management companies having a minimum short term credit rating of A1 and AM3 respectively. The Company is exposed to a concentration of credit risk on its trade debts by virtue of all its customers being �� limits and by securing the majority of trade debts against bank guarantees and Dealer Credit Finance. The credit risk arising on account of acceptance of these bank guarantees is managed by ensuring that the bank guarantees are issued by banks with reasonably high credit ratings as approved by the Board of Directors.

iii. Liquidity risk

�� adequate amount of committed credit facilities. Due to the dynamic nature of the business, the Company maintains flexibility in terms of funding by maintaining committed credit lines available. The Company's liquidity management involves projecting cash flows and considering �� liquidity ratios against internal and external regulatory requirements and maintaining debt ��

risk champions

Risk Champions are risk-aware representatives nominated by their respective functions to report �� for identifying and managing risks within their areas and embedding effective risk management practices in day-to-day operations. Through a structured bottom-up approach, risks are escalated from operational levels to management, fostering a strong risk culture and enabling timely and informed decision-making.

risk assessment

The process involves consideration of the causes and sources of risk, the probability that the risk event will occur, their positive or negative consequences and magnitude, and the probability that those consequences may occur. The Board has approved formal criterion for assessment of the ‘probability’ and ‘impact’ which is used by the management for risk assessment. Each risk is assigned a rating and recorded in the Risk Register. Risk assessment provides the basis for evaluation and decisions regarding risk response or treatment. Assessing the ‘probability’ and �� consistent assessment of both ‘probability’ and ‘impact’. This approach enhances risk visibility and supports informed decision-making.

prioritization of risk

The purpose of this step is to develop a prioritized list of enterprise-level risks for response options. Ranking and prioritizing the enterprise-level risks enables management to respond better to the risks in a structured and planned manner. In order to develop ranking, the risks are ��

implements risk responses

The purpose of this step is to select a combination of risk response options that will optimize Engro’s resources in managing its portfolio of risks. The process involves identifying and assessing the range of risk response options and preparing implementation plans for selected response options.

monitoring and reporting

The ERM Risk Register is reviewed on a periodic basis to ensure updates for changes in the external and internal environment. The ERM Risk Register and mitigation strategies are also �� annual basis

plans and strategies for mitigating these risks and potential opportunities

�� Capital including assessment of compensation programs, succession planning and people’s matters.

Further, various management committees have been constituted which perform regular ��

Additionally, the Internal Audit function provides independent and objective evaluations while �� management and control processes.

key sources of uncertainty

International Financial Reporting Standards require judgments, estimates and assumptions �� the reported amounts of assets and liabilities, income and expenses. The estimates and relevant assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. These estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revision affects only that period, or in the period of the revision and future periods.

�� recoverable amount of goodwill have been disclosed in Note 5 to both separate and consolidated ��

rooted in 103 character driven leadership

rooted in character 104 driven leadership

engro fertilizers limited annual report 2025

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annual report 2025

governance:

Governance of risk remains a priority, with the Board's Audit and Risk Committee actively �� activities. Risk Champions have been appointed across departments to ensure that risks are �� The company’s approach to risk management follows the three lines of defence model:

�� • The second line (Governance, Risk, and Controls function) provides oversight of risk management activities.
The third line (Internal Audit) offers independent assurance and advisory services, ensuring the effectiveness of the company's risk management processes. These initiatives collectively reinforce the company's commitment to a robust risk management framework, ensuring resilience and safeguarding its operations.

key risks, related opportunities, and mitigation strategies

An in-depth and critical analysis of the principal risks faced by the Company business has been ��

The Enterprise Risk Management (ERM) framework has been implemented, which serves as the foundation for consistent risk management practices across the organization.
�� company is prepared to accept in pursuit of its strategic objectives.
��

Following are the major risks and opportunities which may affect our business operations along with the management assessment of their probability, impact and the mitigating strategies implemented by the Company for these risks:

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Risk
Risk Description Risk type Term Probability Impact Mitigation plan
Depletion of allocated Strategic / Medium Medium �� The Company, along with other
�� Operational �� fertilizer companies, is investing in
supply pressure due ��
to faster draw downs ��
affecting production of sustain the gas production plateau
Urea and ability of the and pressures.
plant to operate
�� Continue to invest in additional plant
��
Associated compression facilities
objective:
��
at optimal prices
Inconsistent Strategic Short to Medium �� The Company is actively monitoring
government policies Medium changes occurring in regulatory
affecting gas pricing framework and engages with
and overall Government and other stakeholders to
competitiveness explain business dynamics and issues
impacting the industry to enable
Associated sustainable and progressive policy
objective: making.
��
at optimal prices.
Adverse movement in Financial Short Medium �� Treasury function actively monitors
foreign exchange / movements in market rates and open
interest rates positions.
��
of the company
Associated
objective:
Achieving operational
��
Oversupply in local Commercial Short to �� The Company continues to invest
Urea Market leading to Medium ��
price competition portfolio. Expand on B2C channel
through digital applications for better
Associated
services and satisfaction to the
objective:
farmer. In addition, we continue to
Achieving operational
invest in brand development and
��
long-term customer relationships
the local farmers by
providing inputs at
cheaper prices
Commercial
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rooted in character 106 driven leadership

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Risk Risk
Risk Description Risk type Term Probability Impact Mitigation plan Risk Description Risk type Term Probability Impact Mitigation plan
Reduction in domestic Commercial Short to Medium �� The Company actively monitors Cash flow risk of GIDC Financial / Medium Medium �� Continue to pursue legal course
demand for Urea due to Medium factors affecting demand for Urea and on gas and late Compliance �� challenging the applicability of GIDC
agronomical slowdown optimizes its production payment surcharge in on non-concessionary gas based on
and marketing strategies. case of adverse strong grounds
Associated decision
objective: The Company will continue to invest Associated objective:
Achieving operational
in brand development, market Maintaining business
��
development and long-term customer viability
the local farmers by
providing relationships.
inputs at cheaper
prices.
Ageing plant Operational Short to Medium ��
infrastructure may ��
adversely impact and maintenance of
operational reliability, ��
Attrition of critical Operational Short to �� Medium The Company has formal succession resulting in lower
personnel hindering Medium planning process service factors, ��
increased frequency
the operations plants.
Formal training and development plans of unplanned outages,
are in place for each critical position. and elevated
Associated objective: maintenance ��
Optimize on �� requirements. Over components maintained to
manufacturing focus on employee retention and time, this may lead to ensure timely replacement in
excellence / Achieving engagement. higher total lifecycle case of failure.
�� costs and potential
Employee Engagement surveys �� Business Interruption insurance
conducted annually by independent production coverage. Replacement parts
consultants to assess employee performance. of critical machinery procured
engagement level. Associated objective:
Achieve operational
excellence and
��
Interruptions to critical Operational Medium �� Medium Formal program in place for Business
business operations due to Continuity and Disaster Recovery
to disruptions or ��
�� Business Interruption insurance
floods, earthquakes, coverage obtained.
explosions, terrorism,
tornadoes, extended State of the art IT infrastructure in
power interruptions, place.
hazardous chemical
spills, and other natural Regular system updates, IT audits,
or man-made disasters vulnerability awareness campaigns,
and trainings are conducted to
Associated monitor and minimize the risk
objective:
Achieving operational
��
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Risk
Risk Description Risk type Term Probability Impact Mitigation plan
Information Deployment of modern IT security
Technology and ��
Cybersecurity Risk access management
Associated Regular system updates and patch
Objective: management
Improve operational Operational Short Medium ��
��
enhanced assessments
cross-functional
integration Cybersecurity awareness initiatives
and employee training
Ongoing monitoring and incident
response mechanisms
Failure to comply ��
with applicable laws management of regulatory risks
and regulations.
Associated Continuous monitoring of regulatory
Compliance Short to ��
Objective: developments by senior management
Medium
��
reputation Engagement of external legal and
Maintaining regulatory advisors for specialized
business viability guidance
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performance

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chairman’s review

Dear Shareholders,

On behalf of the Board of Directors, I am pleased to �� for the year ended 2025.

The operating environment in 2025 was characterized by volatility in global nutrient markets, driven by energy price movements, supply constraints, and shifting trade flows, which continued to influence fertilizer affordability and sentiment. Domestically, the year began with low water availability, climate-related disruptions and weak farmer economics, leading to elevated urea inventories, but conditions strengthened in the latter half as water supplies improved and consistent policies boosted offtake, easing inventory pressures.

Within this environment, EFERT’s sustained domestic production continued to deliver meaningful value to the country by reducing reliance on imported fertilizer. During the year, this translated into an estimated USD 906 million in foreign exchange savings for the national exchequer, an important contribution at a time when the country remained focused on economic stability and prudent resource management.

Moreover, the government approved the industry’s gas allocation proposal, resolving a long standing �� development strengthens the foundation for reliable domestic fertilizer production and supports long term planning for the business. The Company continues to engage constructively with stakeholders on the post �� ensure predictable pricing policy going forward.

In line with Engro’s purpose and values, EFERT continued to uphold responsible business practices and a strong focus on social impact. Guided by our culture of Character and Good Manners (CGM), the Company advanced community initiatives in education, healthcare, and environmental stewardship, ensuring that our operational progress was matched by meaningful contributions to the communities we serve.

This commitment to purpose and people was reflected in the recognition EFERT received during the year, with the Company earning 1st prize at the �� Award 2024, and achieving 1st place overall for Employer of Choice at the International Finance ��

As we reflect on the year’s performance, EFERT �� demand during earlier part of the year, increased discounts to support farmers, and a one off super tax charge. Despite these pressures, the Company continued to advance its strategic priorities along with the focus on operational resilience and consistency.

�� more productive and resilient agricultural landscape �� domestic production, supported by strategic �� flexibility and readiness for the years ahead. Alongside this, the Company will continue expanding �� platforms such as Ennovate, UgAi, and Markaz. EFERT will continue to build on the growing potential of specialty fertilizers to support balanced nutrition and evolving crop needs. As demand for reliable nutrient supply continues to grow, EFERT is �� outreach and strategic discipline to reinforce national �� for all stakeholders.

With a clear direction shaping our path ahead, I extend my sincere gratitude to my fellow Board members for their guidance and commitment. My appreciation also goes to our shareholders, regulators, partners, and the farming community for their continued trust. Above all, I commend the management team and all employees of EFERT for their dedication, integrity, and professionalism. �� food security, agricultural productivity, and sustainable economic development.

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Ahsan Zafar Syed Chairman

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engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

ceo’s statement

Dear Shareholders,

I am honored to present the Annual Report of Engro �� The year represented a period of cautious but meaningful �� on the stabilization achieved in the previous year. While structural challenges persisted, the overall direction of the macroeconomic environment reflected steady improvement, supported by policy continuity, gradual easing of inflationary pressures, and ongoing reform ��

Globally, 2025 remained a challenging year for commodity and fertilizer markets, marked by persistent volatility. International urea prices fluctuated sharply driven by seasonal demand shifts, elevated production costs, and geopolitical tensions that increased freight and insurance expenses.

Amidst global headwinds and domestic stabilization, EFERT continued to uphold its commitment to national food security by ensuring consistent and affordable urea supply well below international parity. while the �� year, the Company remained a dependable partner to the �� helping strengthen the resilience of the agricultural value chain and supporting the stability and productivity of a �� term development.

In 2025, the domestic fertilizer market continued to show resilience despite pressures on farmers due to depressed crop prices and weather related disruptions. Urea offtake �� reflecting a recovery in seasonal demand supported by �� incentives that strengthened farmer purchasing power. These factors helped offset broader challenges of weak farm economics and climatic setbacks that weighed on sentiment earlier in the year.

On the supply side, urea production remained steady at �� modest contraction driven mainly by farmer’s affordability constraints and cautious nutrient application amid higher phosphate prices.

Urea business delivered a strong performance, supported by improved plant availability that enabled �� This operational strength enabled the Company to consolidate its position in the domestic market, achieving 34% market share, compared with 31% last year, which was further supported by competitive pricing approach that continued to support farmer affordability.

�� from 306 KT in 2024, reflecting EFERT’s strategically cautious procurement stance amid heightened global price volatility. As a result, the Company’s market share

moderated to 13%, compared to 19% in the previous year. Specialty Fertilizer Business operated under constrained demand conditions, shaped by unfavorable farmer economics and rising category level competition. Despite these challenges, Zabardast Urea delivered a resilient performance through activating over 1,000 dealers nationwide and maintaining its leadership position with a ��

EFERT reached a key regulatory milestone this year, receiving approval from the Economic Coordination Committee (ECC) and the Federal Cabinet for its gas allocation proposal. This decision resolves long-standing issues with gas availability and ensures a more reliable supply for EFERT’s operations, bolstering business continuity over the long term. The new framework enhances cost competitiveness and strengthens the �� environment.

Our pursuit of excellence has been acknowledged on prominent national and international platforms, earning distinctions such as overall 1st prize at the Management �� Top 25 Companies Award 2024, and 1st place overall for �� recognitions reflect our continued focus on operational discipline, innovation, and responsible business practices, and serve as a testament to the dedication of our people and partners.

�� the Company navigated evolving market conditions and �� competitive discounts offered to protect market. Despite �� 28.2% last year, driven by conscious efforts of the team �� operations.

�� 20.1% year on year decrease. The reduction was driven by recognition of a one-off super tax charge coupled with discounts offered by the Company to support farmers. ��

�� uncompromising priority at EFERT. Our commitment to stringent safety protocols resulted in an exceptional Total Recordable Incident Rate (TRIR) of 0.04 (same as �� helped minimize unplanned outages, further enhancing ��

EFERT’s progress continues to be guided by a culture of Character and Good Manners (CGM), which shapes how our people work, lead, and support one another. Choosing what is right, staying humble, and showing empathy remain central to our identity, reinforcing the values that �� stewardship, and long term commitment to our stakeholders.

EFERT’s commitment to social responsibility remained fundamental to its purpose, with continued focus on expanding access to education, improving community health, and improving local infrastructure. Through investments in learning, healthcare, clean water, and livelihood support, the Company worked to enhance quality of life and build resilience across its surrounding communities, reflecting EFERT’s belief that sustainable development happens when business growth supports and goes hand in hand with community well-being.

I would like to express my gratitude to our Chairman and the Board of Directors for their ongoing leadership, strategic direction, and unwavering support. Their guidance and trust have played a pivotal role in steering the organization through a dynamic period, strengthening governance and fostering sustainable long-term value.

��

The operating environment is still very complex and constantly changing, shaped by ongoing issues like climate volatility, geopolitical uncertainties, energy concerns, an d inconsistent policies. While there was some relief t his year due to lower inflation and more favorable m onetary policies, we continue to have �� ��

Ali R athore �� ��

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annual report 20 25

agricultural development. We believe a strong fertilizer sector is essential not only for national food security but also for promoting sustainable economic growth. �� advancing digital capabilities and strengthening operational resilience. Key platforms - including Engro Ennovate, UgAi, and Engro Markaz - are central to our approach, serving as catalysts for innovation, expanding engagement with farmers, and fostering a more connected, knowledge-driven agricultural ecosystem. At �� commitment to reliability and preparedness. This initiative ensures that the Company is equipped to address the evolving demands of the sector and continue supporting sustainable growth in the years to come.

EFERT remains committed to creating shared value by balancing economic performance with social responsibility and environmental stewardship. With a strong foundation, our core values, clear strategic direction, and the collective resolve of our people, we are well positioned to continue to contribute meaningfully to �� sustainable economic growth.

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engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

directors’ report

�� statements of the Company for the year ended December 31, 2025.

�� government in the later part of the year for Rabi crop. In 2024, provincial support prices varied, ��

macro-economic review

�� going up marginally from 4.1% year end 2024 to concluding the year 2025 at 5.6%. Stable inflation rates, allowed gradual and measured reduction in the policy rate, amounting to a cumulative �� earning an �� at year end.

�� ~16% to USD 29.42 billion, up from USD 25.29 billion in FY2024. While services exports grew by 9.3%, goods exports recorded only a modest increase of 4.4%, which was more than offset by a �� support, including bilateral assistance, multilateral funding arrangements, alongside 26.6% increase in workers’ remittances closing at USD 38.3 billion in FY2025 in comparison with USD 30.3 billion in FY2024 which provided near-term stability to the country’s balance of payments.

�� ‘stable’ based on compliance with IMF supported reforms.

�� FY2026 is projected to be 3.2%, indicating a steady and modestly upward trajectory, according to estimates from the IMF.

agriculture review

The agriculture sector posted a subdued performance in FY2025, with growth decelerating �� down to 23.54% from 24.03% in FY2024.

�� 2025 to 31.4 million tons in 2024, and from a cultivation area of 22.4 million acres in comparison with 23.8 million acres respectively, adversely impacting growth of the sector. This decline in area and production is due to negative sentiments associated with wheat pricing distortions and absence of procurement by the Government, which reflected a shift in policy.

�� agricultural inputs, creating more conducive conditions for higher wheat production. As highlighted in the latest Economic Update and Outlook, timely government efforts and improved �� adverse weather conditions along with poor seed quality and decreased area of production.

�� Research, 89% of target set for sowing of cotton crop has been achieved against an area of 2 �� Cotton Committee the national cotton output number of 5.48 million bales, seems below the target number of 8.5 to 9 million bales. A steady recovery is expected in FY2026 based on government’s attempt at a turnaround with revision in support prices and strict seed quality regulations.

�� improve, supported by higher market prices resulting from supply shortages.

Sugarcane area (2025-26) slightly increased by 1.1% YoY based on positive sentiments carried forward from 2024, however on the flipside production decreased by 3.9% based on plunge in productivity, attributable to climatic shifts and low quantity of input due to disrupted purchase power of the farmer.

As part of IMF-backed structural reforms, the government is progressing toward deregulation of the sugar industry, with implementation expected by the end of June 2026. This reform is anticipated �� expected to be protected from potential losses through regulatory safeguards, including the issuance of a list of prohibited sugarcane varieties. Certain challenges for the year 2026 include climate risk, change in structural reforms linked to Government’s ability to maintain supply of main food crops as well as facilitating farmers in terms of purchase power and availability of infrastructure for ��

market review

International Urea prices remained volatile during 2025, moving within a broad range of �� primarily influenced by seasonal demand dynamics, export restrictions by key producing countries, elevated gas-linked production costs, and mid-year supply-side pressures arising from �� the close of the year as supply conditions improved, although underlying tightness in global fertilizer markets persisted.

rooted in 121 character driven leadership

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annual report 2025

�� April-May and accelerated in June-July, reaching a peak of USD 812 per ton in July as market �� demand supported the rally through August. From September, prices entered a correction phase, �� December, still closing the year above January levels.

�� due to multiple factors affecting farmers, input prices and crop yield. Despite the hurdles, fertilizer �� in offtake of Fertilizer by 2% YoY.

�� reflecting a 2.4% increase. This growth was driven based on support prices, improved farmer economics and sustained water availability, which strengthened farmers’ expectations of favorable agricultural conditions for FY2026. In the year 2025, opening inventory was recorded at 366 KT while the year closed at 311 KT owing to the accelerated sales for the month of December.

�� from 1,636 KT in 2024, reflecting the plunge in market sentiment and as a result of higher global prices. The overall global pricing remained bullish due to tension in the South and East Asian regions based on international relations creating volatility in the market.

segment analysis

urea

Urea sales of the company went up by 14.2% YoY from 2,026 KT in 2024 to 2,314 KT in 2025. In �� to secure a 34% market share against 31% last year. The increase in overall urea industry sales was primarily driven by the production targets set by the Federal Committee on Agriculture (FCA), which envisaged wheat output of 29.68 million tons from 9.6 million hectares during the Rabi 2025–26 season, supported by various government incentives for farmers including �� fertilizer industry extended additional support to the farming community through enhanced discounts and other incentives, and EFERT contributed accordingly, notwithstanding differences in underlying production costs.

phosphates

�� throughout the year 2025 on account of international tensions. A new variant, Triple Super �� end. EFERT’s phosphates market share fell to 13% from 19% in 2024 amidst the market crash experienced by the sector in the last quarter of CY2025.

specialty fertilizer business

During CY2025, Engro Zabardast Urea recorded sales of 142 KT amidst a contraction in the zinc coated urea segment, particularly till the third quarter, driven by lower wheat prices which adversely impacted farmer purchasing power. Despite the overall zinc coated urea market declining to approximately 192 KT, the Company achieved a market share of around 2.1%, �� underpinned by sustained dealer engagement initiatives, targeted farmer activation during the Rabi season, and continued brand emphasis on the product’s patented bioactive zinc differentiation.

�� supported through formula optimization, alongside focused marketing efforts targeting large acreage cotton crops, which helped manage cost pressures while sustaining demand acreage cotton crops, which helped manage cost pressures while sustaining demand acreage cotton crops, which helped manage cost pressures while sustaining demand.

�� This shift in market dynamics impacted traded volumes during the year.

our excellence

base plant turnaround

�� focused on preparation, included targeted safety workshops for all site personnel and �� using case studies, past learnings, and roleplay exercises to reinforce compliance culture and to visibly demonstrate leadership commitment to safety.

The second phase of the roadmap unfolded during the Turnaround itself, where enhanced safety �� recognition of good safety performances. These sustained efforts enabled flawless execution with zero recordable injuries, a landmark achievement that reflects both the depth of preparation and the strength of leadership engagement.

engro ennovate

Turning Every Voice into Value is Engro Fertilizers’ flagship platform, launched in 2025, to institutionalize business development as a structured innovation discipline. The initiative empowers �� convert these insights into scalable, high-impact business models. On 10th Dec 2025, one of the biggest Engro Ennovate Day was organized at Daharki site where 26 ideas, put together by the employees throughout the year, were showcased to all Engro Fertilizers employees and Board Members, reflecting both enterprise-wide participation and strategic prioritization. The session marked a milestone in embedding innovation as a repeatable process, rather than a one-off ideation exercise.

rooted in 123 character driven leadership

rooted in character 124 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

ugai

�� delivery service offered as part of the program.

In the year 2025, the company drew on its experience to alter the service further aligning with farmers’ requirements and offering an array of services including soil sampling which will enable farmers to act with precision.

engro markaz

As one of the flagship initiatives of Engro Fertilizers, Engro Markaz plays a pivotal role in empowering the agricultural community by ensuring farmers have timely access to high-quality ��

Engro Markaz allows farmers to purchase products directly from the company through its network of outlets. These centers also serve as knowledge hubs, creating awareness about innovative products and technologies designed to enhance crop productivity and align yields with global benchmarks. Currently, the network includes four operational locations: Sahiwal, Sargodha, Muridke, and Bahawalpur.

Each Engro Markaz is staffed with dedicated personnel who assist farmers with queries, provide guidance on product usage, and ensure year-round access to the full range of Engro Fertilizers’ offerings. By offering products at company prices, these centers reduce dependency on middlemen/arthi and provide a direct platform for farmers to engage with the company, sharing their feedback, concerns, and suggestions.

profit appropriation and reserve transfer

�� Appropriations table below.

Dividends and Appropriation*	PKR Million
openingreserves	34,106
��	(10,682)
��	22,628
Other Comprehensive Income	31
Available for appropriation	59,436

Appropriations
��	(3,004)
��	��
��	(6,009)
ClosingReserves	31,396

Numbers have been rounded up to the nearest Million.

dividends and subsequent events

Consolidated financial review

�� improved to 30.6% in 2025 from 2802% in the preceding year, primarily due to lower turnaround �� 2024 and through driving cost conscious mindset.

�� periods of inventory owing to slowness in fertilizer demand. Company’s tax expense concluded ��

�� billion in 2024, registering a decline by 21.3% YoY.

�� General Meeting to be held on 25th March 2026.

Following an adverse court ruling received subsequent to the reporting period the Company, while exercising prudence and in compliance with applicable accounting standards, has �� for the year ended December 31, 2025.

capital structure and long-term debt management

�� due dates and there have been no defaults in repayment of any debt during the year. Total equity ��

auditors’ report on the financial statements

��

rooted in 125 character driven leadership

rooted in character 126 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

�� on the Company’s Standalone and Consolidated Financial Statements for the year ended December 31, 2025.

prospects and market outlook

�� total required supply at competitive gas rates. Furthermore, in the event of natural depletion of �� Ghazij/Shawal reservoir. This strategic development ensures uninterrupted gas supply, mitigates input cost pressures, and supports margin expansion for the Company.

�� and Middle East in the year 2026. Before the incremental flow of fertilizer in the market, the prices are �� compared to ��has been projected at 4% by the government. Initiatives have been undertaken by the government to enable this growth via adoption of digital agriculture census, issuance and implementation of wheat policy 2025-26 ensuring uninterrupted supply of wheat along with empowerment of farmers, policy reforms as well as budget allocation to infrastructure and energy support for agriculture sector and supporting Agri-Technology in addition to food processing led programs for the masses.

Climate variability continues to shape sector priorities, accelerating investment in climate-resilient storage solutions, including flood-resistant and elevated warehouses, improved �� climate-smart designs are expected to gain a competitive advantage.

Digitalization across agricultural supply chains is expected to expand further in 2026, with increased adoption of warehouse management systems, real-time shipment tracking, data-driven inventory planning, and digital agri-marketplaces, creating opportunities for smart warehousing and logistics technology providers. Overall, while 2025 highlighted structural challenges in agricultural production, it reinforced the critical role of reliable logistics and storage infrastructure. Supported by policy initiatives, digital supply chain integration, and export-focused planning, 2026 presents a strategic growth opportunity for agribusiness, logistics, and warehousing companies.

awards & recognition

During 2025, the Company sustained its tradition of excellence across multiple dimensions, with its efforts receiving recognition at various local and international forums. Set out below are some of the major awards received by EFERT in the areas of Safety, General Management, Finance, Marketing and Technology during the year.

HSE awards & global representation

In 2025, EFERT achieved global recognition by getting recognized in the following forums thus

��

British Safety Council – International Safety Award (Distinction): EFERT recognized for ��
• British Safety Council – CEO Award (2025 Finalist): EFERT was shortlisted among global leaders (10 in total) for championing best-in-class safety practices across business footprint.
�� Frankfurt, Germany.
�� producers worldwide.
��
��
��
EFERT won awards for Transparent Reporting in the Manufacturing Sector at the South ��
• EFERT won 1st place overall for Employer of Choice at the International Finance ��
��
��
��
�� • Best Emerging Technology: UgAi
Best Innovation Mobile App: UgAi
��

our outreach programs

Engro Zabardast Urea (EZU) Campaign

Following the success of this breakthrough thematic platform, EZU’s communication strategy evolved to focus on its functional differentiation - its patented bioactive zinc technology. This ��

TV/Digital Communication

�� voiceover and

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rooted in character 128 driven leadership

engro fertilizers limited

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annual report 2025

Media Campaign

To create massive awareness, EZU bioactive zinc TVC was aired on 18 major national TV �� and frequency build up.

Market development activities

��

Crop Seminar

Social Media Campaign

A targeted social media campaign was rolled out across Meta, YouTube and TikTok platforms - reaching millions of farmers online and ensuring strong visibility during the kharif season. The �� effectively reinforcing the message among the target audience i.e. farmers and agricultural communities across digital channels.

�� Farming” was hosted by Engro Fertilizers in Faisalabad, a collaborative initiative with the �� more than 300 agricultural stakeholders including farmers, academic experts, researchers and a �� the essential role of phosphatic fertilizers in sustainable agricultural productivity, with a particular ��

On-ground activation and merchandising drive

On-ground communication was further strengthened through 22 billboard placements across key rice-growing territories nationwide and the activation of approx. 1000 dealer shops and �� and driving recall among farmers at peak purchase touchpoints.

These initiatives aim to create strong awareness, drive product adoption, and strengthen Engro �� purpose of enriching lives and enabling growth through sustainable agricultural innovation.

HSE initiatives

Overall, the campaign strengthened the positioning of EZU as the category-leading, nutrient-smart fertilizer and reflecting Engro’s commitment to drive meaningful, technology-enabled impact in ��

TV/Digital Communication

Building on the momentum of AI-powered communication, Engro Jeet Ki Baazi campaign drew inspiration from the Mughal era, using its grandeur as a metaphor to highlight the scale and �� mobile phones and earbuds.

To generate campaign awareness and massive hype, the campaign featured an extensive media rollout, including a TVC/DVC aired across all major 16 TV channels – with key focus on prime-time roadblocks and frequency build up and a full-funnel social media campaign across Meta, YouTube, and TikTok, reaching millions of farmers online that generated total reach of 36 Mn, total impressions of 151 Mn and total views of 24 Mn (the campaign is still on-going on digital platforms).

engro triple super phosphate (TSP) launch

New product launch

Engro Fertilizers recently expanded its base business product portfolio with the launch of Engro �� enhanced crop nutrition, stronger root development and plant germination.

Social media campaign

�� across key social media platforms, including Meta, YouTube, and TikTok. The campaign achieved �� the message among the target audience-farmers and agricultural communities across digital channels.

engro muhafiz

�� our operations. The program focuses on training farmers and dealers in safe and environmentally �� infrastructure and practices through healthy competition and token-based recognition.

�� environment-related activities and tree plantation drives carried out across the country.

DOT certified helmets

�� helmet rollout in EFERT Marketing’s history. Extending coverage to Warehouse In-charges, in ��

SOS helpline

�� addresses all potential emergency scenarios encountered on the road, ensuring rapid response and employee safety.

Green office certification

��

rooted in 129 character driven leadership

rooted in character 130 driven leadership

engro fertilizers limited

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annual report 2025

Driver safety orientation program

�� conditioning, a display system and attached facilities to provide a comfortable and effective �� setting, fostering focused and effective learning. The orientation includes a comprehensive Safety Video covering plant and road safety protocols.

Health, safety & environment

EFERT remains steadfast in its commitment to safety as a cornerstone of our operational �� fostering a proactive safety culture and achieving world-class safety performance.

Our safety performance for the year 2025 is reflected in the statistics below.

Total Recordable Injury Rate (TRIR) 0.04 ��

By integrating safety into every aspect of our operations and empowering leadership to prioritize �� excellence is driven by comprehensive training programs, equipping teams with advanced safety �� approach underscores our unwavering commitment to a safe and secure workplace.

Achieving new milestones in HSE performance

�� a leadership-driven focus to streamline practices, and strengthen proactive behaviors The behavioral safety transformation program “Compliance to Commitment” launched in 2025 continued to progress successfully throughout the year under the umbrella of four key domains:
�� addressing chronic issues
��
�� elevate work practices effectiveness.
Safety Star Award: An institutionalized program to recognize individuals for bringing ��
�� to sustain operations. Despite challenges of manual handling, vehicle movement near operating areas, and high ambient conditions, safe execution was ensured through rigorous ��
�� demonstrating continued excellence in quality and safety management
EFERT Daharki has successfully completed geomembrane lining of all 16 ponds and gravity channels as part of its water conservation program, thereby proactively eliminating the risk of soil and groundwater contamination
�� tools have been implemented at the Daharki site to simulate leak consequences, reducing reliance on third-party experts
�� Marketing, with ongoing efforts to strengthen vehicle safety, journey management, and emergency preparedness
�� environmental practices and social responsibility standards through site visits, including plant areas. The audit was highly interactive and well-executed, reflecting our commitment to sustainability.
Zarkhez plant achieved eight million safe manhours with ZERO Total Recordable Incidence Rate for the 6th consecutive year Alhamdulillah. This accomplishment reflects ��
EFERT collaborated with the National Disaster Management Association (NDMA) and ��

Advancement in process safety

In 2025, EFERT continued to strengthen its process safety framework, reinforcing its commitment to global standards, regulatory compliance, and operational excellence.
�� both steady-state operations and non-routine operating conditions such as start-ups, ��
�� reduction targets are achieved and that Safety Instrumented Functions are appropriately designed and reliable. This work further strengthened EFERT’s functional safety and risk management framework.
�� support effective emergency response.
Critical Activity Catalogue: EFERT developed a site-wide Critical Activity Catalogue to identify activities critical to process safety and asset integrity. This initiative establishes clear ��

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annual report 2025

�� the continued reliability, availability, and performance of safety-critical barriers in line with ��

Collectively, these initiatives reflect EFERT’s disciplined and proactive approach to process safety, embedding risk-based decision-making, robust barrier management, and enhanced emergency readiness—further strengthening EFERT’s standing as a safety-focused organization within the fertilizer industry.

HSE capability & skill enhancement

�� specialized workshop on incident investigation techniques using the Tripod Beta �� Rheinland Risktec, alongside scaffolding capability development through a four-day ��
�� auditor, leading to improved safety practices, sustainability initiatives, and audit effectiveness across the site.

Promoting health & well-being

�� monitoring and control practices for food safety requirements.

digitization

The year marked pro

gress in digital transformation and following are the main initiatives that were taken
�� to provide personnel with instant access to safety standards and protocols. This tool has been deployed across the site to streamline safety guidance and improve decision-making at all levels.
Safety Equipment Application has been developed to shift from manual to digital inspections, aiming to standardize safety checklists, ensure real-time tracking with �� prompt corrective actions and reduce safety risks

�� Gold-level gap assessment. During the year, the site also successfully completed the planned

�� included steam optimization at the Base and EnVen plants, installation of new wells to improve water quality, and the timely acquisition of critical regulatory approvals and No Objection ��

�� time, reflecting a structured and systematic approach toward waste minimization, segregation, and circularity. The roadmap was developed after a detailed gap assessment of existing waste management practices and a comprehensive waste segregation exercise. During the year, waste handling and disposal practices were further strengthened through enhanced controls and oversight. The roadmap now provides a clear, year-wise plan to progressively reduce waste generation and improve overall waste performance.

climate change and environment

�� better capture these, we have conducted a baseline assessment of climate related risks and �� Climate-related Financial Disclosures (TCFD) framework. This exercise is crosscutting across businesses and is aimed at providing insights to broaden our understanding of the climate related risk and opportunities we are facing and prepare strategies and action for mitigation and �� corollary to the preliminary exercise which will help us align our methodology and reporting with the TCFD framework requirements, which we intend to implement in the future. As a responsible corporate organization, we monitor our emission levels and their carbon footprint and regularly makes investments in environmental protection through programs such as tree and mangrove plantations, water conservation, awareness sessions, enriching biodiversity etc.

EFERT believes environmental consideration is critical in upholding responsible business operations. The Company strives to manage and utilize its resources and operations in a way that the safety and health of its people, neighbors, customers and visitors is consistently ensured. We �� facilities. The Company aims for the highest environmental standards and the best available technologies and strives to be a leader in developing and advocating sustainable approaches. We �� regularly by world-renowned environmental experts. The Company’s strategic plan for sustainable value creation includes due regard to environmental challenges and plans to

environmental sustainability

During 2025, EFERT continued to advance its environmental sustainability agenda in line with Engro’s Sustainability Framework, with a strong focus on responsible resource use, operational ��

rooted in 133 character driven leadership

rooted in character 134 driven leadership

engro fertilizers limited

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minimize its environmental footprint. EFERT has also set up Environment Sustainability and Stakeholders Engagement Steering Committee. The main objective of this committee is to ensure social and economic progress in the communities within a two-mile radius of our plant �� are the Environment management system elements in grained in the culture and governance of ��

Management Commitment
�� • Goals, objectives and plans • Integrated Organizations • Structure
��

corporate social responsibility

EFERT is committed to creating shared value by integrating social responsibility into its business operations. The Company believes in achieving sustainable growth while contributing positively to the communities in which it operates. Moving beyond traditional corporate philanthropy, ��

In partnership with Engro Foundation, EFERT adopts a collaborative approach that prioritizes community well-being through investments in sustainable programs aimed at generating meaningful social and economic outcomes. These initiatives focus on local development and community empowerment, enabling individuals to build secure and prosperous futures. The active involvement of EFERT’s employees remains central to the success of these efforts, complemented by close coordination with government institutions and development partners to enhance scale and effectiveness.

Demonstrating its commitment to responsible operations and sustainable development, EFERT �� Committee. The committee oversees initiatives that support the social and economic advancement of communities surrounding the Daharki facility, while ensuring strict adherence to �� preparedness and response training.

EFERT’s Corporate Social Responsibility (CSR) initiatives are designed to deliver maximum community impact and are implemented across the following key areas:

Education
��
Skills Development
��
��

education

EFERT recognizes education as a fundamental driver of sustainable development and social progress. As a result, education continues to be a central pillar of the Company’s CSR strategy. Rather than focusing solely on infrastructure, EFERT emphasizes long-term educational outcomes and community empowerment.

The Company currently supports a network of 24 schools: 14 schools in the Katcha area of �� institutions provide safe, inclusive, and supportive learning environments for underprivileged children. During 2025, enrollment at Sahara Community School reached 596 students (including 49% girls).

By the end of 2025, 2,145 students (including 40% girls) were enrolled in EFERT-adopted �� through the Katcha school network. Continuous efforts are made to improve educational quality through structured teacher training and professional development programs, recognizing educators as key enablers of student success.

EFERT views education as a pathway to economic mobility and social inclusion. By expanding access to quality education, the Company supports individuals in improving employment prospects, enhancing living standards, and contributing productively to their communities. partnership with Sindh Education Foundation (SEF)

The Sindh Education Foundation (SEF), established under the Sindh Education Foundation Act, 1992, is a semi-autonomous organization mandated to promote education across Sindh through diverse interventions. Engro Foundation has partnered with SEF on the following initiatives:

Foundation Assisted School (FAS): One SEF-supported school is currently operational in the Katcha area, with 146 students enrolled, comprising 48% girls and 52% boys. This collaboration strengthens the long-term sustainability of education services in the Katcha region through SEF’s expanded institutional presence.
�� centers have been established to support adolescents and adults who previously missed formal education opportunities. The program provides accelerated primary education, basic literacy, and access to skills development and vocational learning. Currently, 210 students are enrolled across the three centers, including 41% girls and 59% boys.

skills development

EFERT continues to invest in human capital development by providing technical education opportunities to youth from surrounding communities. Through a three-year Diploma of Associate Engineering in Chemical, Electrical, and Mechanical disciplines, the Technical Training College in Daharki equips students with industry-relevant skills.

��
Other Community Initiatives
Emergency Response (2025 Floods)

The program has supported many graduates in securing sustainable employment and improving household livelihoods. Current enrollment at the institute stands at 412 students, including 16 female students. 145 students (including 5 girls) graduated this year.

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healthcare services

EFERT places strong emphasis on improving access to quality healthcare services within its operational areas. Recognizing healthcare as a key enabler of community resilience and development, the Company adopts a comprehensive approach to address a wide range of medical needs.

To support individuals affected by mobility impairments, a free-of-cost prosthetic limbs facility �� dedicated dog-bite treatment facility treated 5,194 patients in 2025, addressing canine-borne health risks and strengthening preventive healthcare coverage.

livelihood

To continue the promotion of economic inclusion and self-reliance, EFERT supported 01 new livelihood initiative of a grocery shop in 2025 in addition to existing 12 micro grants from last �� contributing to improved household income and long-term socioeconomic stability.

community physical infrastructure (CPI) support

Recognizing the importance of clean drinking water and basic infrastructure for community �� smooth operations of 11 Reverse Osmosis (RO) plants – primarily solar energy powered which dispensed over 15 million liters of safe and clean drinking water to the surrounding communities.

The efforts were complemented by drainage system upgrades in EFERT CAER Village Kotlo �� streetlights in Engro CAER Villages and public places. In 2025, 40 additional benches were placed at public places in Taluka Daharki reflecting EFERT’s commitment to improving essential services and living conditions.

environment and bio – diversity initiatives

�� Education Department. The focus was on schools and colleges. During these drives, over 10,000 fruit-bearing and all-season plants were planted, contributing to enhanced green cover, biodiversity, and long-term environmental sustainability in the region.

�� WWF to conserve the Indus River Dolphins – a unique species found solely in the River Indus and its tributaries.

Key updates for FY 2025 are as follows:

A two-day consultative workshop was held in Islamabad on December 3–4, 2025, to �� and provincial departments, and conservation partners
�� was the chief guest.
�� conducted 326 patrols with each river guard covering an average of ~51 km across the Indus Dolphin Reserve and adjoining seasonal lakes and irrigation canals, yielding 1928 dolphin sightings.
Support was extended to river guard, trained wildlife watchers as well as Deputy Conservator of Wildlife, from Sindh Wildlife Department for monitoring and SMART data collection from the Indus Dolphin Game Reserve.
Six Indus Dolphins (5 female, 1 male) were rescued and released safely
Four-month pingers trials at Guddu and Taunsa Barrages concluded in Jan 2025. New trials barrage commenced in Nov’25 and will conclude in Feb’26.
��
�� including three Engro Adopted Kacha Schools, as dedicated "River Guards" at the Sukkur project sites. Exposure visit to the Indus Dolphin Reserve was arranged on Dec 18, 2025 for 35 eco-club students from Engro-adopted schools in Ghotki.
��
��
Aquaculture Awareness, Training and Feedback Sessions were conducted
• Kitchen Gardening:
Kitchen gardening project was expanded by including an additional 4 households bringing �� training.
Five kitchen gardening feedback sessions were held with 115 community members (58 �� capacity of kitchen gardeners for household food security. Notably, there was increased engagement of women.
�� watching activities. They have since become a focal point, attracting visitors.

• Taunsa Information Center was revamped with interactive biodiversity displays to educate visitors and students on biodiversity of the Taunsa Barrage Wildlife Centre

A need-based community outreach and awareness session was conducted at Village Zafarabad, using the rescue ambulance as a mobile awareness platform to promote the conservation of the Indus River Dolphin and its associated biodiversity.
�� along with his delegation visited the Indus Dolphin Reserve.
Community Support: Muhammad Mithal, a dedicated Bhulan Dost volunteer received an ��

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An Indus Dolphin-watching boat safari was arranged for a high-level delegation led by Mr. �� Catherine Weibel, Country Director of the United Nations Information Center

This timely and targeted support enabled thousands of farmers to resume cultivation, strengthened household food security through vegetable production, ensured continuity of the regional wheat supply chain, and further reinforced Engro’s position as a responsible and trusted partner to both the government and the farming community.

other community initiatives

Subsidized / Bachat Bazar: EFERT works closely with local authorities to cater evolving community needs. In collaboration with the District Government, the company supported the Ramadhan Bachat Bazar in Daharki town, providing essential food items and household goods at subsidized rates to underprivileged families during the holy month of Ramadhan.

Support to District Administration : Additional support included the provision of rental vehicles �� anti-mosquito drives in CAER villages and surrounding areas, and administration of annual livestock vaccination in Katcha area.

Sports – Cricket Tournament: EFERT also organized events to engage the local youth and community which included a district Ghotki level cricket tournament in which 56 clubs participated. All the teams were provided with cricket kits to encourage young people to participate in productive activities and hone their skills.

Debate Competition for Girls: A district level debate competition (for girls) was also organized where 22 government and private schools participated. Over 600 students attended this event which highlighted women empowerment.

statement of charity account

�� support vital initiatives in education, healthcare, environment, general well-being, and infrastructure development.

our people – our growth imperative

�� to attract, develop, and retain best in class talent to create sustainable value in an increasingly complex and evolving business environment. We recognize that the challenges of the future will �� and a strong performance culture.

To enable long term success, EFERT continues to invest in transforming its talent management approach - strengthening leadership pipelines, enhancing employee engagement, and fostering a culture rooted in learning, accountability, and performance. Our people strategy is anchored in a �� to how we operate and grow.

diversity, equity & inclusion

Science Exhibition: ��

Local Festival: The traditional Jung Mela continued to engage the Daharki community for the 4th �� mela had different stalls, stage performances and activities for children, and a musical band. flood response 2025

�� affecting 4.2 million people and displacing nearly 2.8 million people and hitting 1.3m hectares of land, including mostly cropland and causing extensive damage to homes and other livelihoods. In �� agricultural inputs.

�� practices. During the year, the company strengthened its Diversity, Equity, and Inclusion (DEI) framework, ensuring DEI remains embedded within our organizational strategy and talent processes. Under this renewed diversity ambition, EFERT aims to accelerate progress in gender representation across senior leadership and entry level roles.

Beyond gender diversity, the Company actively advances inclusion across generations, for individuals with disabilities, and for people from diverse socioeconomic backgrounds. Recruitment practices are anchored in fairness and equal opportunity, regardless of gender, �� enables growth and opportunity for all. economic backgrounds. Recruitment practices are �� inclusive workplace that enables growth and opportunity for all.

In close coordination with district administrations and the Agriculture Extension Department, �� and 52,000 vegetable seed kits across all flood-affected districts, mainly Multan, Muzaffargarh, Khanewal, Jhang, and Chiniot.

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buland

Aligned with Engro Fertilizers’ mission to support sustainable agriculture and inclusive growth, the Company has a long-standing focus on farmer development through knowledge sharing, capability building, and access to best agronomic practices. Building on this foundation, EFERT recognized the need to extend targeted support to female farmers, who play a critical role in agriculture yet often remain underrepresented in formal capacity-building initiatives.

�� and economic capacity of smallholder female farmers. The program addresses practical challenges across the crop lifecycle, with training modules covering land preparation, sowing and crop establishment, irrigation and nutrient management, pest and disease control, use of inputs and machinery, harvesting, market linkages, and value addition.

The initial phase of the program required overcoming cultural and operational barriers, including language constraints and limited mobility of female farmers. Through localized delivery models �� effectiveness of the approach and provided the basis for expanding the initiative.

�� collaboration with the Farmers Development Organization (FDO). Female farmers are trained �� application.

Buland 3.0, currently in progress, has further strengthened the program’s reach and depth, with modules being delivered in a phased manner aligned with the Wheat crop cycle. Structured preand post-session assessments continue to be used to measure learning outcomes, ensuring the program remains outcome-driven and impact-focused.

Over three cycles, Buland has transitioned from a pilot initiative to a large-scale, structured development program with growing participation. A consolidated summary of Buland 1.0, 2.0 and 3.0, including crop focus, geographic coverage and scale, is presented in the table below.

Program Phase	Year	Crop/Season	Geographic Coverage	No. Of villages	No. Of Female Farmers	Average Yield (%)
Buland 1.0	2024	Wheat	Jhang	20	400	32%
Buland 2.0	2025	Rice	��	20	400	��
Buland 3.0	2025	Wheat	��	20	550	Results awaited

Through Buland, EFERT continues to promote sustainable agricultural practices while enabling female farmers to participate more actively in farm-level decision-making, household income generation, and community development.

health, wellness & employee care

Employee health and well being remained a key priority, supported through the continued �� for mental and emotional well being, including wellness webinars and workshops, nutritionist consultations, and physiotherapy services - introduced as a new offering during the year.

�� health by building awareness, empathy, and supportive workplace practices. Sessions conducted during the year addressed topics such as post natal workplace adjustment and menopause management.

�� the flagship 41 Day Fitness Challenge, reflecting EFERT’s holistic and integrated approach to employee wellness.

learning, leadership & capability development

EFERT continues to foster a strong culture of apprenticeship and continuous learning, where people development is a shared responsibility across the organization. The company’s �� processes, is designed to promote collaboration, innovation, data driven insights, and evidence based decision making. Managers are expected to create meaningful learning opportunities, provide coaching, and offer constructive feedback - principles that are embedded within performance management, goal setting, and learning systems.

�� program was rolled out for all permanent employees to strengthen leadership capabilities, reinforce shared expectations, and align behaviors with EFERT’s values. In addition, feedback training for leaders further strengthened a culture of continuous improvement and accountability.

Functional capabilities were enhanced through targeted interventions such as the “Factory to �� functional awareness among non marketing employees. Early career talent was also supported through structured Campus to Corporate programs for Graduate Trainee Engineers (GTEs) and Management Trainees (MTs), enabling a smoother transition into professional roles.

culture, values & ethics

EFERT continued to strengthen a value-driven culture by embedding the principles of �� leadership behaviors and people practices. These values were formally embedded into the �� decision making. To translate these values into everyday behavior, Character and Good Manners �� conducted across EFERT, clearly setting expectations around respect, integrity, and professionalism.

�� bias across the organization.

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During the year, EFERT also introduced family centric engagement initiatives to strengthen belonging and community. Events such as Mother’s Day, Father’s Day, Movie Night, family visits �� connect with the organization, reinforcing a culture that values people beyond the workplace.

This integrated focus on values, ethics, inclusion, and family engagement continues to shape a respectful, connected, and purpose led workplace at EFERT.

talent acquisition & workforce diversity

Talent acquisition remained a critical enabler of future capability and organizational resilience. EFERT strengthened its talent pipeline through strategic academic collaborations and job fairs �� Management Trainees through inclusive campus drives.

Key initiatives under the talent acquisition agenda included the centralized Suleman Dawood �� potential candidates.

�� high impact initiatives. These included Break Ke Baad - a program led by Engro Fertilizers to support women re entering the workforce and Unstoppable, which promotes women’s �� meaningful corporate engagement opportunities for experienced professionals.

business ethics & anti-corruption measures

Transparency and accountability are cornerstones of the Company’s approach to governance. We have implemented a robust framework of policies and standards rigorously monitored by high-level committees which ensures every action aligns with ethical and operational best practices. Such policies include:

Code of Conduct
Fraud Risk Management
• Governance of Conflicts of Interest ��
��
Governance of transactions/contracts with related parties

During the year, detailed sessions were held on Ethics and Compliance at the Company which focused on our speak out platform, anti-corruption practices, conflict of interest and insider trading policies.

consumer protection measures

At EFERT, we're dedicated to empowering farmers, not just selling them products. That's why we go beyond fertilizer with a range of consumer protection measures:

�� prices and avoid exploitation.
Expert Guidance: Our trained agronomists equip farmers with knowledge on optimal fertilizer usage, soil health improvement, and best practices for higher yields.
�� understand their soil's needs and tailor their fertilizer uses for optimal results.
Convenient Access: Our extensive distribution network and dealer network ensure timely product delivery, so farmers can focus on what matters most - growing their crops.
�� advertisements and marketing materials, empowering farmers to make informed decisions.

contribution to national exchequer

�� Further, value addition in terms of savings in foreign exchange amounted to approximately USD 906 million through import substitution of 2,314 KT of urea and related products manufactured and sold in the country by EFERT in 2025.

internal control framework

• responsibility

The Board is ultimately responsible for the Company’s systems of internal control and for �� the risk of failure to achieve business objectives and can provide only reasonable rather than absolute assurance against material misstatement or loss. The Board, whilst maintaining its overall responsibility for managing risk within the Company, has delegated the detailed design and operation of the system of internal controls to the Chief Executive.

• framework

The Company maintains an established control framework comprising of clear structures, authority limits, and accountabilities, well understood policies and procedures and budgeting for �� Board establishes corporate strategy and the Company's business objectives. Divisional management integrates these objectives into divisional business strategies with supporting ��

• review

�� plans, capital expenditure proposals and other key performance indicators.

�� from the external and internal auditors and reviews the process for monitoring the effectiveness of internal controls. There is a Company-wide policy governing appraisal and approval of investment expenditure and asset disposals. Once projects are completed, reviews are performed on all material investment expenditure.

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adequacy of internal financial controls

��promoting the culture of moral conduct and ethical obligation within the Company’s systems and processes.

directors’ remuneration

The Company has a formal policy and transparent procedures for the remuneration of its �� Corporate Governance) Regulations, 2019. The policy also provides travel and daily allowance entitlements for Non-Executive Directors for business-related travel.

The remuneration, including the director’s fee for attending the Board or Board Committee ��

pension, gratuity, and provident fund

The employees of the Company participate in Retirement Funds maintained by Engro �� audited accounts are:

��

auditors

�� being eligible, have offered themselves for re-appointment. The Board Audit and Risk Committee recommends their appointment as auditors for the year ending December 31, 2026.

pattern of shareholding

As of December 31, 2025, Associated Companies and Directors of the Company held the following number of shares:

Particulars	% of Shareholding
Associated Companies	��
Directors and Dependents	0.000%

A detailed pattern of shareholding is disclosed in the Shareholder’s Information section of the Annual Report.

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Particulars	Number of Meetings
Mr. Ahsan Zafar Syed Non-Executive Director-Chairman	4/5
Mr. FarooqBarkat Ali Non-Executive Director	4/5
Mr. Ahmad Shakoor Non-Executive Director	5/5
Mr. Asad Said Jafar* Non-Executive Director	5/5
Mr. Mohammad Younus Dagha**** Independent Director	3/5
Mr. Rizwan Khalil Sheikh* Independent Director	3/5
Ms. Sadia Khan ** Independent Director	3/5
Mr. Ali Rathore ��	5/5
Mr. Asim Murtaza Khan* Independent Director	2/5
Mr. Javed Akbar** Non-Executive Director	2/5
Ms. Danish Zuberi*** Independent Director	1/5

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	Mr. Rizwan Khalil Sheikh, Chairman 3/4 Particulars Number of Meetings
	Mr. Asad Said Jafar** 3/4
	Ms. Sadia Khan 3/4
	�� 1/4
	Mr. Javed Akbar** 1/4
	Mr. Ahsan Zafar Syed*** 1/4

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BARC composition and attendance

The Board Audit and Risk Committee held 4 meetings to cover its complete cycle of activities. The attendance record of the Directors is as follows:

Particulars	Number of Meetings
Mr. Mohammad Younus Dagha, Chairman	3/4
Mr. Farooq Barkat Ali	2/4
Mr. Asad Said Jafar	4/4
Mr. Javed Akbar*	1/4
Mr. Asim Murtaza Khan**	1/4

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engro fetilizers limited

rooted in 169 character driven leadership

rooted in character 170 driven leadership

engro fertilizers limited annual report 2025

annual report 2025

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engro fertilizers limited

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engro fetilizers limited

rooted in 171 character driven leadership

rooted in character 172 driven leadership

annual report 2025

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engro fertilizers limited

engro fetilizers limited

rooted in 173 character driven leadership

rooted in character 174 driven leadership

annual report 2025

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engro fertilizers limited

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engro fetilizers limited

rooted in 175 character driven leadership

rooted in character 176 driven leadership

annual report 2025

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rooted in 177 character driven leadership

rooted in character 178 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

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engro fertilizers limited

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engro fetilizers limited

rooted in 179 character driven leadership

rooted in character 180 driven leadership

annual report 2025

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engro fertilizers limited

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engro fetilizers limited

rooted in 181 character driven leadership

rooted in character 182 driven leadership

annual report 2025

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engro fertilizers limited

rooted in engro fetilizers limited character 423 annual report 2025 driven leadership

rooted in 183 character driven leadership

annual report 2025

corporate strategy & resource allocation

strategy

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measurable KPIs in achieving strategic excellence

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adaptability in strategy: responding to change

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optimized resource allocation for sustainable growth

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----- Start of picture text -----

Rs. Financial
Capital
Human
Capital
Social and
Relationship
Capital
Manufactured
Capital
Intellectual
Capital
Natural
Capital
----- End of picture text -----

rooted in 185 character driven leadership

rooted in character 186 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

3. Optimize on manufacturing excellence

Long-term objective

==> picture [504 x 250] intentionally omitted <==

----- Start of picture text -----

Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
----- End of picture text -----

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----- Start of picture text -----

2. Enhance farmer productivity Long-term objective
Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
----- End of picture text -----

Long-term objective

==> picture [504 x 566] intentionally omitted <==

----- Start of picture text -----

Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
4. Leverage brand name to increase top-line Long-term objective
Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
----- End of picture text -----

rooted in 187 character driven leadership

rooted in character 188 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

5. Become the farmer's preferred partner by offering new value added products

Long-term objective

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----- Start of picture text -----

Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
----- End of picture text -----

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----- Start of picture text -----

6. Achieving operational efficiency Medium to Long-term objective
Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
----- End of picture text -----

7. Corporate social responsibility

Long-term objective

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----- Start of picture text -----

Strategic
Actions
Resource
Allocation Rs.
Measurable
KPI & its
relevance
----- End of picture text -----

8. Making a positive impact by adopting best sustainable practices

Long-term objective

Strategic Actions Resource Allocation Rs. Measurable KPI & its relevance

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rooted in 189 character driven leadership

rooted in character 190 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

effect of demographic & climate change

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adoption of united nations sustainable development goals (UNSDGs)

journey to UNSDGs: efert’s contributions

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no poverty, quality education, decent work and economic growth, reduced inequalities

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rooted in 191 character driven leadership

rooted in character 192 driven leadership

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annual report 2025

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rooted in 193 character driven leadership

rooted in character 194 driven leadership

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annual report 2025

gender equality

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��and ��

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zero hunger

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Productivity, innovation & soil stewardship

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annual report 2025

enhanced crop nutrition:

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regulatory support:

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agricultural diversification:

potassium access:

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scientific advisory:

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climate resilience & livelihood restoration

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flood relief initiative:

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input affordability:

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community support:

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good health and well-being

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Community healthcare initiatives

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Buland program

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the buland program:

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Buland 1.0 (Wheat, Jhang):��
Buland 2.0 (Rice, Pakpattan): ��

farmer outreach:

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Employee wellness & occupational health

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Policy advocacy & market governance

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rooted in 197 character driven leadership

rooted in character 198 driven leadership

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annual report 2025

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Supply chain safety & disaster response

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Community outreach & preventive awareness

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clean water & sanitation

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Community water access

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Operational water stewardship & governance

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rooted in character 200 driven leadership

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annual report 2025

Health, safety, and environment (HSE) outreach

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affordable and clean energy

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Operational excellence in manufacturing

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Energy optimization initiatives

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Digital tools and engineering upgrades

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responsible consumption and production, and industry, innovation, and infrastructure

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Environmental stewardship and operational excellence

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Waste management and process optimization

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rooted in character 202 driven leadership

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annual report 2025

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Sustainable agriculture and nutrient management

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Policy advocacy and regulatory oversight

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industry, innovation, and infrastructure

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climate action & life on land

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Operational excellence and resource optittmization

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Climate resilience and livelihood restoration

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rooted in 203 character driven leadership

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annual report 2025

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Community awareness and afforestation

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life below water

Indus River Dolphins Conservation Project

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annual report 2025

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partnerships for the goals

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peace, justice, and strong institutions

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strengthening institutional capacity and policy advocacy

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Multi-stakeholder collaboration and implementation

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rooted in 207 character driven leadership

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annual report 2025

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Policy advocacy and institutional strengthening

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investor relations

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----- Start of picture text -----

Financial Year ended December 31, 2025
April 22, 2025 ��
July 30, 2025 ��
October 15, 2025 ��
February 12, 2026 ��
Financial Year ending December 31, 2026
April 20, 2026 ��
July 29, 2026 ��
October 19, 2026 ��
��
February 11, 2027
----- End of picture text -----*

��

==> picture [484 x 188] intentionally omitted <==

----- Start of picture text -----

Trading Performance During the Financial Period 2025
Opening Price 204.19
Closing Price 226.35
Highest Closing Price 239.45
Lowest Closing Price 155.68
Average daily volume traded (million shares) 1.615
Total Shareholder Return 2025
1 - year period (01 January 2025 to 31 December 2025) 20%
3 - year period (01 January 2023 to 31 December 2025) 274%
5 - year period (01 January 2021 to 31 December 2025) 402%
----- End of picture text -----**

**Total returns are computed based on the closing unit price on the last trading day of the preceding reporting period, compared with the closing unit price on the last trading day of the current period.

==> picture [484 x 90] intentionally omitted <==

----- Start of picture text -----

2025 2024 2023 2022 2021 2020
Dividend payout ratio
112.1 101.6 89.2 112.6 98.1 81.0
Market Capitalization 2025 2024 2023 2022 2021 2020
(Bn) 302 273 150 103 102 84
----- End of picture text -----

rooted in 209 character driven leadership

rooted in character 210 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

financial performance review quarterly analysis

(Rupees in million)

==> picture [481 x 149] intentionally omitted <==

----- Start of picture text -----

Description Q1 Q2 Q3 Q4 FY 2025
��
��
Profit after taxation 2,898 5,565 5,811 8,354 22,628
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----- End of picture text -----

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==> picture [380 x 159] intentionally omitted <==

----- Start of picture text -----

9,000
8,354
8,000
7,000
5,811
5,565
6,000
5,000
4,000
2,898
3,000
2,000
1,000
Q1 Q2 Q3 Q4
----- End of picture text -----

Quarter wise sales volumes (KT)

==> picture [380 x 159] intentionally omitted <==

----- Start of picture text -----

1,200
90
1,000
800
600 1,034
25
66
400
29 589
200
431
260
0
Urea Phosphates
----- End of picture text -----

Earnings / Dividend per share

==> picture [380 x 170] intentionally omitted <==

----- Start of picture text -----

10.00
8.00
8.00
6.26
6.00 4.17 4.35 4.50
4.25
4.00
2.17 2.25
2.00
-
Q1 Q2 Q3 Q4
EPS DPS
----- End of picture text -----

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rooted in 211 character driven leadership

rooted in character 212 driven leadership

engro fertilizers limited

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annual report 2025

detailed quarterly analysis

first quarter

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----- Start of picture text -----

Period Production Sales Net Profit
��
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----- End of picture text -----

production:

��

sales revenue

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cost of sales and other operational costs

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profit

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second quarter

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----- Start of picture text -----

Period Production Sales Net Profit
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----- End of picture text -----

production

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sales

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cost of sales and other operational costs

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profit

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rooted in 213 character driven leadership

rooted in character 214 driven leadership

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annual report 2025

third quarter

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----- Start of picture text -----

Period Production Sales Net Profit
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----- End of picture text -----

production

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fourth quarter

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----- Start of picture text -----

Period Production Sales Net Profit
��
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----- End of picture text -----

production

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sales

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cost of sales and other operational costs

��

profit

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cost of sales and other Operational costs

��

profit

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rooted in character 216 driven leadership

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Analysis of variation in interim accounts with final accounts

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rooted in 217 character driven leadership

engro fertilizers limited

annual report 2025

==> picture [1125 x 810] intentionally omitted <==

----- Start of picture text -----

horizontal analysis
consolidated statement of financial position
(Amounts in millions)
EQUITY AND LIABILITIES 2025 25 Vs. 24 2024 24 Vs. 23 2023 23 Vs. 22 2022 22 Vs. 21 2021 21 Vs. 20 2020
Rs. % Rs. % Rs. % Rs. % Rs. % Rs.
EQUITY
Share capital 13,353 - 13,353 - 13,353 - 13,353 - 13,353 - 13,353
Share premium 3,385 - 3,385 - 3,385 - 3,385 - 3,385 - 3,385
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Total Equity 44,747 (5.7) 47,459 (0.9) 47,903 6.3 45,053 (4.3) 47,087 0.8 46,731
NON-CURRENT LIABILITIES
Borrowings 29,446 57.5 18,702 472.4 3,267 (44.1) 5,842 (49.0) 11,460 (15.2) 13,514
Deferred taxation - (100.0) 673 (93.5) 10,402 27.6 8,155 (31.7) 11,943 2.3 11,678
Deferred liabilities 34 (86.1) 248 4.6 237 0.6 235 1.3 232 (15.0) 273
Provision for GIDC - - - - - (100.0) 2,315 (63.6) 6,364 (39.5) 10,510
Deferred income - Government grant 343 (33.4) 514 (28.7) 721 (19.0) 891 (3.7) 925 - -
29,823 48.1 20,136 37.7 14,627 (16.1) 17,438 (43.6) 30,924 (14.0) 35,975
CURRENT LIABILITIES
Trade and other payables 65,699 (1.4) 66,606 (10.1) 74,096 64.1 45,156 73.5 26,027 (13.9) 30,219
Accrued interest / mark-up 1,434 18.6 1,209 1,560.9 73 (86.0) 520 98.0 262 (0.2) 263
Taxation - net - - - (100.0) 994 (78.0) 4,512 231.5 1,361 100.0 -
Current portion of:
- borrowings 14,462 410.3 2,834 4.4 2,715 (60.2) 6,828 18.6 5,756 (42.8) 10,062
- deferred income - government grant 172 (15.3) 203 (14.0) 236 (7.9) 256 65.9 154 100.0 -
- deferred liabilities 102 63.8 63 - 63 (10.9) 70 10.0 64 17.2 54
- provision for GIDC 19,558 - 19,558 - 19,558 17.1 16,705 41.4 11,816 70.6 6,927
Short term borrowings 23,023 84.9 12,452 2,248.9 530 (93.2) 7,826 90.1 4,118 868.6 425
Unclaimed dividend 146 77.1 82 70.4 48 (1.9) 49 (0.5) 49 (13.7) 57
Loan from Holding Company - - - - - (100.0) 1,000 (80.8) 5,200 420.0 1,000
124,596 21.0 103,007 4.8 98,313 18.6 82,922 51.3 54,807 11.8 49,007
Total Liabilities 154,419 25.4 123,144 9.0 112,940 12.5 100,360 17.1 85,731 0.90 84,983
TOTAL EQUITY AND LIABILITIES 199,166 16.7 170,602 6.1 160,843 10.6 145,413 9.5 132,817 0.8 131,713
ASSETS
NON-CURRENT ASSETS
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Intangible assets 4,780 (4.5) 5,008 (3.4) 5,184 (2.0) 5,288 (0.3) 5,301 2.6 5,165
Long term loans and advances 27 (86.5) 198 (5.7) 210 1.6 207 239.7 61 (25.7) 82
Long-term investments 4,349 1.9 4,268 2,011.6 202 (90.8) 2,204 - - - -
Deferred taxation 1535 100 - - - - - - - - -
103,082 11.3 92,611 10.2 84,036 (1.8) 85,579 9.2 78,394 10.4 70,981
CURRENT ASSETS
Stores, spares and loose tools 9,151 11.1 8,240 (5.6) 8,730 34.4 6,495 1.1 6,427 0.3 6,411
Stock-in-trade 25,692 (3.9) 26,729 74.1 15,356 (9.0) 16,868 25.0 13,490 79.1 7,533
Trade debts 16,846 104.1 8,253 183.4 2,912 (22.8) 3,772 22.9 3,070 5.6 2,906
Loans, advances, deposits and prepayments 3,669 (20.1) 4,595 15.1 3,993 42.9 2,796 25.0 2,237 2.2 2,189
Other receivables 7,835 (34.7) 11,996 (25.3) 16,057 (6.8) 17,226 35.9 12,677 52.7 8,304
Taxation - net 8,689 - 9,907 100.0 - - - - - (100.0) 2,858
Accrued income 147 (45.9) 272 133.3 117 (33.4) 175 806.7 19 (87.8) 158
Short term investments 16,013 333.9 3,691 (84.7) 24,063 148.9 9,669 (36.6) 15,238 (43.1) 26,763
Cash and bank balances 8,043 86.7 4,308 6.3 4,054 43.0 2,834 123.7 1,266 (64.9) 3,610
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96,084 23.2 77,991 1.5 76,807 28.4 59,835 9.9 54,424 (10.4) 60,732
TOTAL ASSETS 199,166 16.7 170,602 6.1 160,843 10.6 145,413 9.5 132,817 0.8 131,713
rooted in rooted in
character engro fertilizers limited engro fetilizers limited character
driven leadership annual report 2025 annual report 2025 driven leadership
----- End of picture text -----

horizontal analysis consolidated statement of financial position

rooted in 219 character driven leadership

rooted in character 220 driven leadership

horizontal analysis of consolidated statement of financial position

==> picture [380 x 188] intentionally omitted <==

----- Start of picture text -----

Capital Structure
100%
80% 69%
66% 73% 78% 89% 50%
60%
40%
50%
20% 34%
27% 22% 31%
11%
0%
2020 2021 2022 2023 2024 2025
Debt Equity
including current portion
----- End of picture text -----

Balance Sheet Analysis (Equity and Liabilities)

==> picture [381 x 153] intentionally omitted <==

----- Start of picture text -----

100%
12% 9% 12% 15%
27% 23%
80%
60% 37% 41% 57% 61% 60% 63%
40%
20% 35% 35% 31% 30% 28% 22%
0%
2020 2021 2022 2023 2024 2025
Equity Current Liabilities Non-current Liabilities
----- End of picture text -----

current liabilities

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----- Start of picture text -----

Balance Sheet Analysis (Assets)
100%
80% 46% 41% 41%
48% 46% 48%
60% 4% 5%
4% 3% 5% 6%
40%
55%
50% 54% 49% 49% 46%
20%
0%
2020 2021 2022 2023 2024 2025
Property, Plant & Equipment Non-current Assets Current Assets
----- End of picture text -----

non-current assets

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current assets

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shareholders’ equity

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non-current liabilities

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rooted in 221 character driven leadership

rooted in character 222 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

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vertical analysis
consolidated statement of financial position
(Amounts in millions)
EQUITY AND LIABILITIES 2025 2024 2023 2022 2021 2020
Rs. % Rs. % Rs. % Rs. % Rs. % Rs. %
EQUITY
Share capital 13,353 6.7 13,353 7.8 13,353 8.3 13,353 9.2 13,353 10.1 13,353 10.1
Share premium 3,385 1.7 3,385 2.0 3,385 2.1 3,385 2.3 3,385 2.5 3,385 2.6
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Total Equity 44,747 22.5 47,459 27.8 47,903 29.8 45,053 31.0 47,087 35.5 46,731 35.5
NON-CURRENT LIABILITIES
Borrowings 29,446 14.8 18,702 11.0 3,267 2.0 5,842 4.0 11,460 8.6 13,514 10.3
Deferred taxation - - 673 0.4 10,402 6.5 8,155 5.6 11,943 9.0 11,678 8.9
Deferred liabilities 34 0.0 248 0.1 237 0.1 235 0.2 232 0.2 273 0.2
Provision for GIDC - - - - - - 2,315 1.6 6,364 4.8 10,510 8.0
Deferred income - Government grant 343 0.2 514 0.3 721 0.4 891 0.6 925 0.7 - -
29,823 15.0 20,136 11.8 14,627 9.1 17,438 12.0 30,924 23.3 35,975 27.3
CURRENT LIABILITIES
Trade and other payables 65,699 33.0 66,606 39.0 74,096 46.1 45,156 31.1 26,027 19.6 30,219 22.9
Accrued interest / mark-up 1,434 0.7 1,209 0.7 73 0.0 520 0.4 262 0.2 263 0.2
Taxation - net - - - - 994 0.6 4,512 3.1 1,361 1.0 - -
Current portion of:
- borrowings 14,462 7.3 2,834 1.7 2,715 1.7 6,828 4.7 5,756 4.3 10,062 7.6
- deferred income - government grant 172 0.1 203 0.1 236 0.1 256 0.2 154 0.1 - -
- deferred liabilities 102 0.1 63 0.0 63 0.0 70 0.0 64 0.0 54 0.0
- provision for GIDC 19,558 9.8 19,558 11.5 19,558 12.2 16,705 11.5 11,816 8.9 6,927 5.3
Short term borrowings 23,023 11.6 12,452 7.3 530 0.3 7,826 5.4 4,118 3.1 425 0.3
Unclaimed dividend 146 0.1 82 0.0 48 0.0 49 0.0 49 0.0 57 0.0
Loan from Holding Company - - - - - - 1,000 0.7 5,200 3.9 1,000 0.8
124,596 62.6 103,007 60.4 98,313 61.1 82,922 57.0 54,807 41.3 49,007 37.2
TOTAL EQUITY AND LIABILITIES 199,166 100.00 170,602 100.00 160,843 100.0 145,413 100.0 132,817 100.0 131,713 100.0
ASSETS
NON-CURRENT ASSETS
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Intangible assets 4,780 2.4 5,008 2.9 5,184 3.2 5,288 3.6 5,301 4.0 5,165 3.9
Long term loans and advances 27 0.0 198 0.1 210 0.1 207 0.1 61 0.0 82 0.1
Long-term investments 4,349 2.2 4,268 2.5 202 0.1 2,204 1.5 - - - -
Deferred taxation 1535 - - - - - - - - - - -
103,082 51.8 92,611 54.3 84,036 52.2 85,579 58.9 78,394 59.0 70,981 53.9
CURRENT ASSETS
Stores, spares and loose tools 9,151 4.6 8,240 4.8 8,730 5.4 6,495 4.5 6,427 4.8 6,411 4.9
Stock-in-trade 25,692 12.9 26,729 15.7 15,356 9.5 16,868 11.6 13,490 10.2 7,533 5.7
Trade debts 16,846 8.5 8,253 4.8 2,912 1.8 3,772 2.6 3,070 2.3 2,906 2.2
Loans, advances, deposits and prepayments 3,669 1.8 4,595 2.7 3,993 2.5 2,796 1.9 2,237 1.7 2,189 1.7
Other receivables 7,835 3.9 11,996 7.0 16,057 10.0 17,226 11.8 12,677 9.5 8,304 6.3
Taxation - net 8,689 4.4 9,907 5.8 - - - - - - 2,858 2.2
Accrued income 147 0.1 272 0.2 117 0.1 175 0.1 19 0.0 158 0.1
Short term investments 16,013 8.0 3,691 2.2 24,063 15.0 9,668 6.6 15,238 11.5 26,763 20.3
Cash and bank balances 8,043 4.0 4,308 2.5 4,054 2.5 2,834 1.9 1,266 1.0 3,610 2.7
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96,084 48.2 77,991 45.7 76,806 47.8 59,835 41.1 54,424 41.0 60,732 46.1
TOTAL ASSETS 199,166 100.0 170,602 100.0 160,843 100.0 145,413 100.0 132,817 100.0 131,713 100.0
rooted in rooted in
character engro fertilizers limited engro fetilizers limited character
driven leadership annual report 2025 annual report 2025 driven leadership
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vertical analysis consolidated statement of financial position

rooted in 223 character driven leadership

rooted in character 224 driven leadership

vertical analysis of consolidated statement of financial position

shareholders’ equity

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non-current liabilities

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current liabilities

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non-current assets

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current assets

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rooted in 225 character driven leadership

engro fertilizers limited annual report 2025

horizontal and vertical analysis profit or loss

(Amounts in millions)

Net sales Cost of sales �� Selling and distribution expenses Administrative expenses Other income Other operating expenses �� Finance costs Remeasurement gain / (loss) on provision for GIDC Gain / (loss) allowance on subsidy receivable from GoP �� Taxation �� HORIZONTAL ANALYSIS	237,131 (7.6) (164,578) (10.9) 72,553 0.9 (20,213) 12.5 (4,723) 10.0 2,550 (12.8) (4,590) 1.7 45,577 (5.2) (6,171) 49.5 - - 625 (48.0) 40,031 (11.3) (17,403) 3.0 22,628 (19.9) Rs. % 2025	256,675 14.7 (184,751) 22.0 71,924 (0.5) (17,961) 37.6 (4,293) (6.2) 2,925 (21.2) (4,513) 3.3 48,082 (11.0) (4,129) 208.6 - (100.0) 1,203 (149.3) 45,156 (9.1) (16,896) (28.1) 28,260 7.9 Rs. % 2024		Rs. % 2023	Rs. % 2022	Rs. % 2021 Rs. % 2020
				223,704 42.5 (151,407) 32.6 72,297 68.7 (13,053) 32.0 (4,578) 106.5 3,714 59.7 (4,369) 73.2 54,011 76.8 (1,338) (48.9) (538) (36.0) (2,440) 366.5 49,693 87.1 (23,502) 122.6 26,191 63.7	157,017 18.6 (114,170) 29.3 42,847 (2.8) (9,886) 15.9 (2,217) 16.7 2,325 29.9 (2,523) (4.5) 30,546 (6.9) (2,622) 63.7 (840) 13.1 (523) (6.3) 26,561 (11.1) (10,558) 20.0 16,003 (24.1)	132,363 25.1 105,846 (12.8) (88,289) 23.3 (71,591) (12.5) 44,074 28.7 34,255 (13.4) (8,530) 0.9 (8,457) (3.2) (1,900) (1.0) (1,919) 53.8 1,790 7.4 1,667 (61.7) (2,641) 39.4 (1,894) (27.8) 32,793 38.6 23,652 (24.4 (1,602) (50.5) (3,236) (16.7) (743) (135.0) 2,121 100.0 (558) (55.0) (1,239) 100.0 29,890 40.3 21,298 (22.3) (8,797) 177.9 (3,165) (69.9) 21,093 16.3 18,133 7.5

VERTICAL ANALYSIS Net sales Cost of sales �� Selling and distribution expenses Administrative expenses Other income Other operating expenses �� Finance costs Remeasurement gain / (loss) on provision for GIDC Gain / (loss) allowance on subsidy receivable from GoP �� Taxation ��	Rs. % 2025 Rs. % 2024		Rs. % 2023	Rs. % 2022	Rs. % 2021 Rs. % 2020
	237,130 100.0 256,675 100.0 (164,577) 69.4 (184,751) 72.0 72,553 30.6 71,924 28.0 (20,213) 8.5 (17,961) 7.0 (4,723) 2.0 (4,293) 1.7 2,550 1.1 2,925 1.1 4,590) 1.9 (4,513) 1.8 45,577 19.2 48,082 18.7 (6,171) 2.6 (4,129) 1.6 - - - - 625 (0.3) 1,203 (0.5) 40,031 16.9 45,156 17.6 (17,403) 7.3 (16,896) 6.6 22,628 9.5 28,260 11.0		223,704 100.0 (151,407) 67.7 72,297 32.3 (13,053) 5.8 (4,578) 2.0 3,714 1.7 (4,369) 2.0 54,011 24.1 (1,338) 0.6 (538) 0.2 (2,440) 1.1 49,693 22.2 (23,502) 10.5 26,191 11.7	157,017 100.0 (114,170) 72.7 42,847 27.3 (9,886) 6.3 (2,217) 1.4 2,325 1.5 (2,523) 1.6 30,546 19.5 (2,622) 1.7 (840) 0.5 (523) 0.3 26,561 16.9 (10,558) 6.7 16,003 10.2	132,363 100.0 105,846 100.0 (88,289) 66.7 (71,591) 67.6 44,074 33.3 34,255 32.4 (8,530) 6.4 (8,457) 8.0 (1,900) 1.4 (1,919) 1.8 1,790 1.4 1,667 1.6 (2,641) 2.0 (1,894) 1.8 32,793 24.8 23,652 22.3 (1,602) 1.2 (3,236) 3.1 (743) 0.6 2,121 2.0 (558) 0.4 (1,239) 1.2 29,890 22.6 21,298 20.1 (8,797) 6.6 (3,165) 3.0 21,093 15.9 18,133 17.1

rooted in 227 character driven leadership

rooted in character 228 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

horizontal analysis of consolidated statement of profit or loss

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100% 2% 1% 1% 1% 1% 1%
90%
80%
70%
60%
50% 98% 99% 99% 99% 99% 99%
40%
30%
20%
10%
0%
2020 2021 2022 2023 2024 2025
Revenue Other Income
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sales

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Sales Revenue year-wise (Rs. in Million)

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300,000
256,675
250,000 237,130
223,705
200,000
157,017
150,000 132,363
105,846
100,000
50,000
0
2020 2021 2022 2023 2024 2025
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cost of sales

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gross profit

��

operating profit

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100%
80
60
40
20
0
2020 2021 2022 2023 2024 2025
Cost of Sales Selling & Distribution Administrative Expenses
Other Operating Expenses Finance Cost Taxation
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rooted in 229 character driven leadership

rooted in character 230 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

finance costs

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taxation

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vertical analysis of consolidated statement of profit or loss

gross profit

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taxation

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Cost Analysis (Rs. million)
250,000
200,000
150,000
100,000
50,000
0
2020 2021 2022 2023 2024 2025
Cost of Sales Selling & Distribution Administrative Expenses
Other Operating Expenses Finance Cost Taxation
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��

net profit

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net profit

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rooted in 231 character driven leadership

rooted in character 232 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

analysis of consolidated statement of cashflows

Cash Flow Analysis (Rs. in million)

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60,000
45,000
30,000
15,000
0
(15,000)
(30,000)
(45,000)
(60,000) 2020 2021 2022 2023 2024 2025
Net Cash generated from / (used in) Net Cash generated from / (used in) Net Cash generated from / (used in)
Operating Activity Investing Activities Financing Activities
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cashflows from operating activities

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cashflows from investing activities

business rationale of major capital expenditure and projects

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cashflows from financing activities

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rooted in 233 character driven leadership

rooted in character 234 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

cash flow statement - direct method

(Amounts in thousand)

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||||
|---|---|---|
|2025|............Rupees............|2024|
|CASH FLOWS FROM OPERATING ACTIVITIES|
|Cash receipts from customers|227,856,347|236,066,609|
|Cash paid to supplier / service providers and employees - net|(177,811,986)|(199,946,053)|
|Payment to Workers Welfare fund|(1,120,000)|(870,742)|
|Payment to Workers Profit Participation fund|(2,650,001)|(1,667,618)|
|Income tax paid|(18,412,358)|(37,529,156)|
|Net cash generated from / (utilized in) operating activities|27,862,002|(3,946,960)|
|CASH FLOWS FROM INVESTING ACTIVITIES|
|��|(14,444,067)|(9,227,357)|
|Proceeds from disposal of operating assets|1,658,539|1,581,789|
|Purchase of short-term and long-term investments|(35,722,328)|(88,945,624)|
|Proceed from sales of short term and long term investment|23,319,664|106,001,485|
|Disbursment of loan to parent company|(2,690,000)|-|
|Repayment received against loan to parent company|2,690,000|-|
|Net cash (utilised in) / generated from nvesting activities|(25,188,192)|9,410,293|
|CASH FLOWS FROM FINANCING ACTIVITIES|
|Proceeds from long-term borrowings|24,000,000|18,000,000|
|Proceeds from short-term borrowings|20,500,000|4,500,000|
|-|
|Repayments of short-term borrowings|(5,000,000)|
|Loan repaid to the Parent Company|(33,113,000)|(11,500,000)|
|Repayments of long-term borrowings|(1,830,913)|(2,686,717)|
|Loan obtained from parent Company|33,113,000|11,500,000|
|Finance cost paid|(6,371,947)|(3,018,963)|
|Dividends paid|(25,307,225)|(28,674,928)|
|Net cash generated from / (utilized in) financing activities|5,989,915|(11,880,608)|
|��|8,663,725|(6,417,275)|
|��|(2,443,701)|3,973,574|
|��|6,220,024|(2,443,701)|

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six years analysis financial information summary (Amounts in millions)

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||||||||
|---|---|---|---|---|---|---|
|2025|2024|2023|2022|2021|2020|
|Summary of Consolidated Statement of|
|Financial Position|
|Share capital|13,353|13,353|13,353|13,353|13,353|13,353|
|Reserves|31,394|34,106|34,550|31,700|33,734|33,378|
|��|44,747|47,459|47,903|45,053|47,087|46,731|
|Borrowings|43,908|21,536|5,982|12,670|17,215|23,576|
|Capital employed|88,655|68,995|53,885|57,723|64,302|70,306|
|Deferred liabilities|34|920|10,638|8,390|12,175|11,951|
|��|92,391|83,137|78,440|77,880|73,031|65,734|
|Long term assets|103,082|92,611|84,036|85,579|78,394|70,981|
|Current assets|96,084|77,991|76,807|59,835|54,425|60,733|
|Summary of Consolidated Statement of|
|Profit or Loss|
|Sales|237,131|256,675|223,704|157,017|132,363|105,846|
|Gross profit|72,553|71,924|72,297|42,847|44,074|34,255|
|Operating profit|45,577|48,081|54,010|30,546|32,793|23,652|
|Profit before taxation|40,031|45,156|49,693|26,561|29,890|21,298|
|Profit after taxation|22,628|28,260|26,191|16,003|21,093|18,133|
|EBITDA|51,457|53,744|55,691|32,622|34,522|29,878|
|Summary of Consolidated Statement of|
|Cashflows|
|Net cash flow from operating activities|27,862|(3,947)|60,555|31,634|16,381|51,470|
|Net cash flow from investing activities|(25,188)|9,410|(18,744)|(18,927)|14,258|(25,744)|
|Net cash flow from financing activities|5,990|(11,881)|(33,741)|(29,181)|(23,388)|(24,629)|
|��|8,664|(6,417)|8,070|(16,474)|7,251|1,096|
|��|6,220|(2,444)|3,974|(4,097)|12,377|5,126|
|Summary of Actual Production|
|(units in MT)|
|Urea|2,289,705|2,147,025|2,313,448|1,954,528|2,104,722|2,263,806|
|NP|76,891|105,296|96,328|137,075|144,564|127,082|

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rooted in 235 character driven leadership

rooted in character 236 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

financial ratios

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|||||||||
|---|---|---|---|---|---|---|---|
|2025|2024|2023|2022|2021|2020|
|Profitability Ratios|
|��|%|49.08|59.27|56.35|34.74|44.97|40.29|
|��|%|86.8|94.7|106.9|57.7|63.7|47.3|
|Return on Capital Employed|%|28.7|46.0|46.9|26.2|31.3|25.1|
|Return on Shareholders' Funds|%|50.6|59.5|54.7|35.5|44.8|38.8|
|Shareholders' Funds Ratio|%|22.5|27.8|29.8|31.0|35.5|35.5|
|Pre tax margin|%|16.9|17.6|22.2|16.9|22.6|20.1|
|Profit markup|%|44.1|39.2|47.8|37.5|49.9|47.8|
|Gross Profit ratio|%|30.6|28.02|32.3|27.3|33.3|32.4|
|Net Profit to Sales|%|9.5|11.0|11.7|10.2|15.9|17.1|
|EBITDA|Rs. In million|51,457|53,744|55,119|32,622|34,522|29,878|
|EBTDA|Rs. In million|45,286|49,615|53,780|30,000|32,919|26,642|
|Growth in EBITDA|%|(4.3)|(2.5)|69.0|(5.5)|15.5|(19.2)|
|Growth in EBTDA|%|(8.7)|(7.7)|79.3|(8.9)|23.6|(19.4)|
|EBITDA Margin to Sales|%|21.7|20.9|24.6|20.8|26.1|28.2|
|Operating leverage ratio|Times|1.2|(0.2)|1.8|(0.4)|1.1|1.7|
|Return on assets|%|12.2|17.1|17.1|11.5|15.9|14.0|
|Growth in Operating revenue|%|(7.6)|14.7|42.5|18.6|25.1|(12.8)|
|Capital Expenditure to total Assets|%|7.25|5.41|3.84|5.76|7.96|4.00|
|Liquidity Ratios|
|Current ratio|Times|0.77|0.76|0.78|0.7|1.0|1.2|
|Quick / Acid test ratio|Times|0.5|0.4|0.5|0.4|0.6|1.0|
|��|%|0.05|(0.01)|0.0|(0.0)|0.2|0.1|
|Cash flow from Operations to Sales|%|0.1|(0.0)|0.3|0.2|0.1|0.5|
|Cash flow to capital expenditure|Times|1.9|(0.4)|9.8|3.8|1.4|9.8|
|Cash flow coverage ratio|Times|0.4|(0.1)|9.2|1.5|0.7|2.1|
|Long term liabilities / current liabilities|%|24|20|15|21|56|73|
|Activity / Turnover Ratios|
|No. of days Inventory|Days|58|42|39|49|43|51|
|Inventory turnover|Times|6.3|8.8|9.4|7.5|8.4|7.2|
|Debtors turnover ratio.|Times|18.9|46.0|66.9|45.9|44.3|12.4|
|No. of days in receivables|Days|19|8|5|8|8|29|
|Trade payables turnover ratio|Times|2|3|2.5|3.2|3.1|3|
|No. of days in payables|Days|147|139|144|114|116|123|
|Operating cycle|Days|(69)|(90)|(99)|(57)|(65)|(43)|
|Total Assets turnover ratio|Times|1.28|1.55|1.46|1.13|1.00|0.82|
|Fixed Assets turnover ratio|Times|2.6|3.1|2.9|2.0|1.8|1.6|
|Current Assets Turnover|Times|2.72|3.32|3.27|2.75|2.30|1.82|
|Operating working capital turnover|Times|(9)|(11)|(10)|(13)|23|11|
|Capital employed turnover|Times|3.01|4.18|4.01|2.57|1.97|1.46|

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financial ratios

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|||||||||
|---|---|---|---|---|---|---|---|
|2025|2024|2023|2022|2021|2020|
|Investment /Market Ratios|
|Earnings per Share - basic|Rs./ share|16.95|21.16|19.61|11.98|15.8|13.6|
|Earnings per Share - diluted|Rs./ share|16.95|21.16|19.61|11.98|15.8|13.6|
|Earnings growth (diluted)|%|(19.93)|7.90|63.66|(24.13)|16.32|7.4|
|Earnings growth (basic)|%|(19.93)|7.90|63.66|(24.13)|16.32|7.4|
|Market value per share|
|��|Rs./ share|226.4|204.2|112.2|76.9|76.1|63.2|
|- High during the year|Rs./ share|239.5|215.0|115.4|102.4|79.1|76.0|
|- Low during the year|Rs./ share|145.3|112.7|75.0|74.6|61.8|49.0|
|Cash dividend per share|Rs./ share|19.0|21.5|20.5|13.5|15.5|11.0|
|Breakup value per share|Rs./ share|33.5|35.5|35.9|33.7|35.3|35.0|
|Breakup value per share - incuding surplus on revaluation|Rs./ share|33.5|35.5|35.9|33.7|35.3|35.0|
|Breakup value per share - including investment in|
|related party at market value and surplus on revaluation|Rs./ share|33.5|35.5|35.9|33.7|35.3|35.0|
|Price earning ratio|Times|13.4|9.6|5.7|6.4|4.8|4.7|
|Change in market value added|%|14.3|120.9|77.0|5.7|44.8|(31.2)|
|Price to book ratio|Times|6.8|5.7|3.1|2.3|2.2|1.8|
|Dividend yield ratio|%|8.4|10.5|15.6|17.6|20.4|17.4|
|Dividend payout ratio|%|112.1|101.6|89.2|112.6|98.1|81.0|
|Dividend cover ratio|%|89.2|98.4|112.1|88.8|101.9|123.5|
|Retention (after interim & proposed cash)|%|(12.1)|(1.6)|10.8|(12.6)|1.9|19.0|
|Capital Structure Ratios|
|Financial leverage ratio|Times|0.98|0.5|0.1|0.3|0.4|0.5|
|Earning assets to total assets|%|8.1|3.1|16.4|7.0|11.7|20.8|
|Weighted average cost of deposit|%|7.5|15.8|18.3|14.3|7.6|8.1|
|Weighted average cost of debt|%|12.2|20.4|9.9|12.5|7.1|11.4|
|��|%|65.8|39.4|6.8|13.0|24.3|28.9|
|��|%|98.12|45.4|12.5|28.1|36.6|50.5|
|��|%|14.5|7.9|4.0|12.3|16.9|27.9|
|Interest Cover ratio|Times|7.5|11.9|38.1|11.1|19.7|7.6|
|Others|
|Spares inventory over total assets|%|5|5|5|4|5|5|
|Maintenance cost over operating expenses|%|1.7|3.4|1.9|4.6|2.7|1.8|
|Production per employee|Units (KT)|1,997|1,927|1,985|1,546|1,628|1,755|
|Revenue per employee|Rs. In thousands|200,110|219,568|184,271|116,051|95,777|77,714|
|Net income per employee|Rs. In thousands|19,095|24,175|21,574|11,828|15,262|13,314|
|Donation as a percentage of PAT|%|1.8|1.6|2.2|1.8|2.0|1.8|

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rooted in 237 character driven leadership

rooted in character 238 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

analysis of financial ratios

Profitability Ratios

��

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��
80,000 35.0%
70,000 30.0%
60,000
25.0%
50,000
20.0%
40,000
15.0%
30,000
10.0%
20,000
10,000 5.0%
0 0.0%
2020 2021 2022 2023 2024 2025
��
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Liquidity Ratios

��

Liquidity Analysis (Rs.in million)

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----- Start of picture text -----

140,000 1.25
120,000
1.00
100,000
0.75
80,000
60,000 0.50
40,000
0.25
20,000
0 0
2020 2021 2022 2023 2024 2025
Current Assets Current Liabilities Current Ratio Quick Ratio
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Activity / Turnover Ratios

��

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Operating Life Cycle Ratios in Days
150
120
90
60
30
0
2020 2021 2022 2023 2024 2025
Inventory Debtors Creditors
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Investment / Market Ratios

��

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Earnings, Break up Value & Market Value
(Rs. per share)
250.00
200.00
150.00
100.00
50.00
0
2020 2021 2022 2023 2024 2025
Earnings per share Market value Break up value
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240

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engro fetilizers limited

annual report 2025

Dividend Ratios (in Percentages)

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140
120
100
80
60
40
20
0
2020 2021 2022 2023 2024 2025
Inventory Debtors Creditors
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Capital Structure Ratios

��

Capital Structure

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100%
80%
60%
40%
20%
0%
2020 2021 2022 2023 2024 2025
Debt Equity
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Market share information

��

Market Share

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35%
40%
36%
35% 33% 34%
31%
30% 29%
25% 23% 23%
22%
20%
18% 17% 16%
15%
10%
5%
0%
2020 2021 2022 2023 2024 2025
Urea Phosphates
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Return on Equity & Capital Employeed
(Rs. in million & in Percentage)
2020 2021 2022 2023 2024 2025
Equity Capital Employed Return on Equity Return on Capital Employed
100,000 70.00
90,000
60.00
80,000
70,000 50.00
60,000
40.00
50,000
30.00
40,000
30,000 20.00
20,000
10.00
10,000
0 0
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Production and Sales volume (K Tons)

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2,500 40%
35%
2,000
30%
1,500 25%
20%
1,000 15%
10%
500
5%
0 0%
2020 2021 2022 2023 2024 2025
Production Sales Market share
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Equity and Net Assets Per Share

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2020 2021 2022 2023 2024 2025
Equity Net Asset Per Share
55,000
50,000 50.00
45,000 45.00
40,000 40.00
35,000
35.00
30,000
30.00
25,000
20,000 25.00
15,000 20.00
10,000 15.00
5,000 10.00
0
5.00
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rooted in character 242 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

share price sensitivity

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Share price analysis
300.00 16,000,000
14,000,000
250.00
12,000,000
200.00 10,000,000
150.00 8,000,000
6,000,000
100.00
4,000,000
50.00 2,000,000
0 0
Trade Volume(in 000`s) Hight (PKR) Low (PKR) Closing (PKR)
Jan-25 Feb-25 Mar-25 Apr-25 May-25 Jun-25 Jul-25 Aug-25 Sep-25 Oct-25 Nov-25 Dec-25
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��

Macro Economic and Political environment

��

Government Regulations

��

Stakeholder sentiments

��

Sensitivity Analysis of Share Price of the Holding Company

��

Shareholder relations and share price

��

Market capitalization sensitivity

��

economic value added

(Amounts in millions)

��

�� �� �� 2025 �� �� ��	2024 �� �� ��

Interest rate

��

Sales volume

��

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engro fetilizers limited

annual report 2025

dupont analysis

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50.57%
Return on
Equity
11.36% 22.47%
Return on Owner's
Assets equity ratio
9.54% 119.06% 44,747 199,166
Net Profit Asset Owner's Total
margin turnover equity assets
199,166 154,419
22,628 237,131 237,131
Total Total
Net Profit Sales Sales
assets liabilities
199,166 124,596
237,131 Total Cu rrent
Sales
assets liabilities
29,823
214,503 Non-Current
Total cost
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124,596
Cu rrent
liabilities
29,823
Non-Current
liabilities
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statement of value addition and distribution

(Amounts in millions)

2025 2024 Wealth generated �� Wealth distributed ��

Wealth distributed 2025

Wealth distributed 2024

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0.5%
5%
3% 1%
8%
5%
47% 46%
31% 34%
11% 9%
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��

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rooted in character 246 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

social and relationship capital

year 2025

EFERT goes beyond simply giving back and believes in doing good while doing well. As a �� company and the communities we engage with. We partner with the Engro Foundation to create a win-win model and take responsibility for people's well-being, investing in sustainable projects that drive positive social and economic change. Through sustainable projects driven by our Engro Foundation, we invest in local development and empower residents to create a brighter future. Our dedicated employees are vital to this success, and we work closely with government and development partners to maximize our impact.

statement of charity account

Committed to social responsibility, the company generously contributed PKR 403 million to support vital education, healthcare, environment, general wellbeing, and infrastructure development initiatives.

corporate social responsibility (CSR) initiatives

Demonstrating its commitment to responsible operations and sustainable development, EFERT has established the Environment Sustainability & Stakeholders Engagement Steering Committee. The committee oversees initiatives that support the social and economic advancement of communities surrounding the Daharki facility, while ensuring strict adherence to Health, Safety, and Environment (HSE) standards through comprehensive emergency preparedness and response training.

EFERT’s Corporate Social Responsibility (CSR) initiatives are designed to deliver maximum community impact and are implemented across the following key areas:

Education
Healthcare Services
Skills Development
Livelihood
Community Physical Infrastructure (CPI) Support
Environment: Tree Plantation and Bio – Diversity Initiatives
Other Community Initiatives
Emergency Response (2025 Floods)

education

The Company currently supports a network of 24 schools; 14 schools in the Katcha area of Ghotki and 10 schools in Daharki town including 01 campus of Sahara High School. These institutions provide safe, inclusive, and supportive learning environments for underprivileged children. During 2025, enrollment at Sahara Community School reached 596 students (including 49% girls).

By the end of 2025, 2,145 students (including 40% girls) were enrolled in EFERT-adopted government schools, while 1,667 students (including 30% girls) continued their education through the Katcha school network. Continuous efforts are made to improve educational quality through structured teacher training and professional development programs, recognizing educators as key enablers of student success.

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partnership with sindh education foundation (SEF)

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rooted in character 248 driven leadership

engro fertilizers limited annual report 2025

Foundation Assisted School (FAS): One SEF-supported school is currently operational in the Katcha area, with 146 students enrolled, comprising 48% girls and 52% boys. This collaboration strengthens the long-term sustainability of education services in the Katcha region through SEF’s expanded institutional presence.
Adolescent and Adult Learning and Training Program (AALTP): Three non-formal education centers have been established to support adolescents and adults who previously missed formal education opportunities. The program provides accelerated primary education, basic literacy, and access to skills development and vocational learning. Currently, 210 students are enrolled across the three centers, including 41% girls and 59% boys.

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healthcare services

The Sahara Clinic remains a cornerstone of EFERT’s healthcare initiatives, providing free healthcare services to the community. In 2025, the primary healthcare clinic treated 8,460 patients while the eye specialist OPD running at the Sahara Clinic treated 360 patients. Furthermore, to date 5,975 patients have been treated at the snakebite treatment facility to address critical regional health risk.

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skills development

livelihood

To continue the promotion of economic inclusion and self-reliance, EFERT supported 01 new livelihood initiative of a grocery shop in 2025 in addition to existing 12 micro grants from last year. �� contributing to improved household income and long-term socioeconomic stability.

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community physical infrastructure (CPI) support

Recognizing the importance of clean drinking water and basic infrastructure for community well-being, EFERT continued its CPI interventions across the region in 2025. These included smooth operations of 11 Reverse Osmosis (RO) plants – primarily solar energy powered which dispensed over 15 million liters of safe and clean drinking water to the surrounding communities. The efforts were complemented by drainage system upgrades in EFERT CAER Village Kotlo Mirza, Jung Colony, and Juma Laghari. EFERT also facilitated the installation of 40 solar streetlights in Engro CAER Villages and public places. In 2025, 40 additional benches were placed at public places in Taluka Daharki reflecting EFERT’s commitment to improving essential services and living conditions.

environment and bio – diversity initiatives

Tree Plantation: As part of its commitment to environmental stewardship, EFERT conducted tree plantation campaigns across district Ghotki in collaboration with SEPA and Government Education Department. The focus was on schools and colleges. During these drives, over 10,000 fruit-bearing and all-season plants were planted, contributing to enhanced green cover, biodiversity, and long-term environmental sustainability in the region.

�� WWF to conserve the Indus River Dolphins – a unique species found solely in the River Indus and its tributaries. Key updates for FY 2025 are as follows:

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rooted in character 250 driven leadership

engro fertilizers limited annual report 2025

A two-day consultative workshop was held in Islamabad on December 3–4, 2025, to develop a new Indus River Dolphin Conservation Action Plan attended by relevant federal and provincial departments, and conservation partners
WWF-Pakistan celebrated 25 Years of Indus River Dolphin Conservation on Dec 4, 2025. Federal Minister for Climate Change & Environmental Coordination, Dr Musadik Malik was the chief guest.
Patrols & Monitoring (using SMART application): River guards and wildlife watchers conducted 326 patrols with each river guard covering an average of ~51 km across the Indus Dolphin Reserve and adjoining seasonal lakes and irrigation canals, yielding 1928 dolphin sightings.
Support was extended to river guard, trained wildlife watchers as well as Deputy Conservator of Wildlife, from Sindh Wildlife Department for monitoring and SMART data collection from the Indus Dolphin Game Reserve.
Six Indus Dolphins (5 female, 1 male) were rescued and released safely
Four-month pingers trials at Guddu and Taunsa Barrages concluded in Jan 2025. New trials barrage commenced in Nov’25 and will conclude in Feb’26.
River Health Assessment Workshop: Engagement continued with communities and schools with Citizen Science for River Health Assessment and recording species.
WWF-Pakistan has successfully trained 266 students from 9 eco-club-registered schools, including three Engro Adopted Kacha Schools, as dedicated "River Guards" at the Sukkur project sites. Exposure visit to the Indus Dolphin Reserve was arranged on Dec 18, 2025 for 35 eco-club students from Engro-adopted schools in Ghotki.

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• Women-Led Aquaculture: reporting framework

��
Aquaculture Awareness, Training and Feedback Sessions were conducted

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Kitchen Gardening:
Kitchen gardening project was expanded by including an additional 4 households bringing the total count to 16. The 4 HHs were provided with seeds, gardening equipment and training.
Five kitchen gardening feedback sessions were held with 115 community members (58 men and 57 women), with the aim to foster community engagement and strengthen capacity of kitchen gardeners for household food security. Notably, there was increased engagement of women.
�� watching activities. They have since become a focal point, attracting visitors.
Taunsa Information Center was revamped with interactive biodiversity displays to educate visitors and students on biodiversity of the Taunsa Barrage Wildlife Centre

A need-based community outreach and awareness session was conducted at Village Zafarabad, using the rescue ambulance as a mobile awareness platform to promote the conservation of the Indus River Dolphin and its associated biodiversity.

In February 2025, the Spanish Ambassador to Pakistan, His Excellency Mr. Jose A. de Ory, along with his delegation visited the Indus Dolphin Reserve.
Community Support: Muhammad Mithal, a dedicated Bhulan Dost volunteer received an ��

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rooted in character 252 driven leadership

engro fertilizers limited annual report 2025

Through EDGE, EFERT aims to provide focused support, resources, and development �� accelerate career progression and transition into leadership roles. By

An Indus Dolphin-watching boat safari was arranged for a high-level delegation led by Mr. Mohmed Yahya, UN Resident & Humanitarian Coordinator for Pakistan, and MsCatherinWeibel, Country Director of the United Nations Information Center

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other community initiatives

Support to District Administration: Additional support included the provision of rental vehicles for bi-monthly Anti Polio vaccination campaigns across the district, implementation of anti-mosquito drives in CAER villages and surrounding areas, and administration of annual livestock vaccination in Katcha area.

Sports – Cricket Tournament: EFERT also organized events to engage the local youth and community which included a district Ghotki level cricket tournament in which 56 clubs participated. All the teams were provided with cricket kits to encourage young people to participate in productive activities and hone their skills.

Debate Competition for Girls: A district level debate competition (for girls) was also organized where 22 government and private schools participated. Over 600 students attended this event which highlighted women empowerment.

Science Exhibition: Science exhibition was also held in November 2025 with 75 matric level �� models and exhibits from categories- Static, Dynamic and Pictorial.

Local Festival: The traditional Jung Mela continued to engage the Daharki community for the 4th year as families attended the event enthusiastically. With a footfall of 10,000+ attendees, the mela had different stalls, stage performances and activities for children, and a musical band.

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flood response 2025

In 2025, Punjab province faced severe riverine flooding along the Sutlej, Ravi, and Chenab rivers, affecting 4.2 million people and displacing nearly 2.8 million people and hitting 1.3m hectares of land, including mostly cropland and causing extensive damage to homes and other livelihoods. In response to a request from the Government of Punjab, Engro Fertilizers committed to supporting �� agricultural inputs.

engro muhafiz program

�� with the Company’s HSE policy, aimed at protecting and training all communities involved in or connected with our operations. The program focuses on training farmers and dealers in �� activities encourage improvements in infrastructure and practices through healthy competition and recognition.

rooted in 253 character driven leadership

rooted in character 254 driven leadership

engro fertilizers limited annual report 2025

engro fertilizers limited

annual report 2025

�� engaging 15,500+ farmers, dealers, and community members through various initiatives. These included 90+ Health Awareness Sessions, 335+ Road & General Safety Awareness Sessions, and 30+ environment-related activities and tree plantation drives carried out across the country.

Some major CSR and HSE Initiatives under Muhafiz Program :

The Field Warehousing Team from the Central Zone organized a comprehensive Medical and �� provide critical medical relief and health awareness to vulnerable community members, with a primary focus on women and children. Participants received professional medical assistance and guidance on preventive healthcare practices, addressing urgent health needs �� community outreach program.
In a collaborative effort with the Vocational Training Institute Minchinabad and Rescue 1122, �� Supply Chain North Team. The program was designed to enhance emergency response capabilities and basic life-saving skills among the youth. Students and staff received practical �� session successfully empowered approximately 200 participants with vital safety knowledge.
The Distribution Sahiwal Region spearheaded a Tree Plantation Drive aimed at fostering environmental stewardship among the younger generation. By mobilizing students and staff from a local college, the team successfully planted 100 trees to promote a greener, more �� participants in the collective mission of environmental conservation.

Other Significant HSE Initiatives:

DOT Certified Helmets

�� helmet rollout in EFERT Marketing’s history. Extending coverage to Warehouse In-charges, in addition to Field Assistants, reinforced inclusivity in the HSE program.

SOS Helpline

The Logistics Daharki team provides a critical 24/7 SOS Helpline offering emergency support and guidance to marketing personnel. Developed in collaboration with the HSE team, the helpline addresses all potential emergency scenarios encountered on the road, ensuring rapid response and employee safety.

Green Office Certification

��

Driver Safety Orientation Program

A dedicated HSE Training Room has been established for drivers and helpers, equipped with air conditioning, a display system and attached facilities to provide a comfortable and effective learning environment. In 2025, over 75,000 trainings were conducted in a disturbance-free setting, fostering focused and effective learning. The orientation includes a comprehensive Safety Video covering plant and road safety protocols.

The SFB North Zone Sales team conducted a SMOG Awareness and Healthy Environment session in Samundri to mitigate health risks within agricultural communities. Supported by the University of Agriculture Faisalabad (UOAF) and the local Agriculture Department, the session provided 180 participants with practical preventive measures and adaptive strategies to manage the health and operational impacts of seasonal smog.
To improve safety standards in agricultural operations, the SFB North Sales team �� safe handlin of heavy equipment to reduce farm injuries. Through interactive guidance, 150 farmers were equipped with the knowledge to maintain a safer working environment ��
The Central Zone Sales team held a Road Safety Awareness session for local school �� and safe pedestrian practices, highlighting the role of early education in reducing road-related risks. Approximately 110 students participated in these interactive discussions to ensure their future safety.
An Environmental Awareness session was organized by North Zone Sales to sensitize the farming community to sustainable agricultural practices. The program focused on resource conservation and minimizing the ecosystem impact of farming. Roughly 100 farmers attended, gaining practical insights into maintaining environmentally responsible and productive operations.

rooted in 255 character driven leadership

rooted in character 256 driven leadership

engro fertilizers limited annual report 2025

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manufactured and intellectual capital

training & development initiatives

At Engro Fertilizers, our people are our greatest asset. Throughout 2025, we have made �� requires both strong leadership and deep technical expertise. We have launched multiple initiatives to develop talent at every career stage, from mentorship programs and knowledge-sharing platforms to technical training and structured career pathways. These programs reflect our commitment to building a capable, resilient workforce ready to meet today's challenges and drive tomorrow's success.

lighthouse coaching program

The Lighthouse Coaching Program is founded on the belief that the best fertilizer for a crop is the farmer’s shadow - consistent presence and care enable growth. In the same way, talent is best nurtured through sustained, meaningful engagement between coach and mentee. Through this program, EFERT’s senior leaders illuminate the path for early-career engineers, sharing insights gained from decades of leadership through focused one-on-one conversations. Each engineer is paired with a senior leader outside their reporting line, creating a trusted and safe space for open dialogue, guidance, and tailor made coaching.

key features:

One-on-one mentorship outside reporting lines, ensuring open dialogue without formal appraisal.
• Providing tailor-made feedback based on the Individual Development Tools (IDT) assessments results covering personality, team roles, and career anchors
Personalized guidance aligned with Engro's Leadership Competency Model
Quarterly developmental conversations focused on career growth and leadership capabilities

Over 100+ manhours have been invested in developmental conversations to create a future ready workforce.

dhk talks

In a fast-paced industrial environment, our teams need accelerated exposure to strategic thinking and leadership insights to sharpen their decision-making capabilities. Senior leaders hold valuable expertise and experiences that need to be shared more widely across the organization to speed up learning and development. To fast-track the learning curve and sharpen minds across the organization, DHK Talks bridges this gap through a leadership-driven knowledge-sharing platform where senior executives share their expertise, experiences, and industry insights with teams across all levels

Knowledge-sharing sessions led by senior executives from across the Engro group.
Direct engagement platform, connecting leadership with employees at all levels while providing networking opportunities

400+ manhours have already been invested in professional development. The initiative has enhanced access to valuable insights from senior leadership, learning how executives approach complex challenges, and developing strategic thinking by understanding industry trends and business perspectives.

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engro fertilizers limited

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annual report 2025

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key features:

Position-based programs spanning 1 - 5 years with Basic Intermediate Expert progression
• Four-pillar training approach: Internal classroom training, External/Online courses, Hands-on Skill Lab training, and Industrial Conferences
• Benchmarked against industry leaders

Comprehensive Professional Development Plans have been created covering all positions across functional areas at Engro Fertilizers Manufacturing.

building technical excellence at every level

Engro Fertilizers recognizes that operational excellence depends not only on engineers but equally on skilled technicians who maintain and operate our plants. Building technical expertise at the craftsman level is essential for sustainable operations and long-term success.

To develop highly skilled technical craftsmen, the Trade Apprentice Development Program �� theoretical instruction and hands-on practical training in mechanical maintenance, electrical systems, instrumentation, and plant operations.

trade apprentice development program

A 2-year training program transforming young individuals into skilled technical craftsmen through theoretical instruction and hands-on practical training in engineering mechanical, maintenance, electrical systems, instrumentation, civil, administration and plant operations.

key features:

skill.link program

As industrial technologies and regulatory standards rapidly evolve, maintaining deep functional competency requires continuous technical upskilling. Engineers need access to specialized knowledge from global experts to stay current with industry best practices, emerging safety standards, and digital transformation trends that are reshaping operational excellence.

To strengthen the functional core competency of our engineers, Skill.Link addresses this need through a webinar-based learning platform delivering focused technical training sessions on industry codes, standards, and digital transformation through partnerships with globally recognized institutions.

key features:

Specialized technical sessions from AIChE Academy, Exida, and industry experts
Coverage of process safety, functional safety, equipment diagnostics, and regulatory compliance
Flexible online delivery enabling participation without operational disruption

Until now1,500 learning manhours have been achieved. The program has enabled proactive upskilling in critical areas including functional safety assessment, equipment diagnostics, and data-driven decision making while maintaining operational continuity.

professional development plans (PDPs)

To enhance career development and ensure consistent growth opportunities for our engineers, we have established structured pathways that systematically build technical skills and capabilities. This approach provides clarity and prepares engineers for increasing responsibilities throughout their careers.

Professional Development Plans deliver clear roadmaps for M1 and M2 level engineers across all functional areas at Engro Fertilizer Manufacturing.

Comprehensive orientation covering HSE, organizational culture, policies, and plant operations
On-the-job training under supervision of master craftsmen and senior technicians
• Competency-based assessments at regular intervals
��

Currently hosting 70+ apprentices from Batch 47, with 82 new apprentices (including 12 female apprentices) welcomed in Batch 48. The program builds technical workforce capability while creating skilled employment pathways for local youth, contributing to both organizational excellence and community development.

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rooted in character 260 driven leadership

engro fertilizers limited annual report 2025

skill lab

Technical competence requires more than theoretical knowledge, engineers and technicians need hands-on experience with actual equipment and control systems. Learning on operational plant equipment carries risks and operational disruptions, while traditional classroom training �� troubleshooting tasks.

�� industrial equipment in safe learning environments, complementing classroom instruction and enhancing operational reliability and safety across the facility.

marketing innovations

Improving farmers’ lives – helping our farmers grow

To bridge the gap between theory and practice, the Skill Lab provides a state-of-the-art training �� control systems in safe, controlled environments. The facility features dedicated Mechanical and Electrical & Instrumentation labs equipped with real industrial components, cut-out models, and operational systems for practical skill development.

key features:

Mechanical Skill Lab: Workbenches for milling, drilling, and precision measuring; mechanical

Farmers are the driving force behind our value chain, shaping the future of agriculture in Pakistan. We are deeply committed to empowering our farmers and helping them thrive, ensuring national food security and maximizing value throughout every step of the process. Inspired by this mission, we have launched a dynamic and sustainable strategy that includes a range of initiatives backed by our farmer advisory platform, supporting our farmers’ journey to success and fostering growth.

Farmer development initiatives

cut-out models; natural gas booster compressors and turbines for overhaul practice
Electrical & Instrumentation Skill Lab: PLCs, DCS, ESD controllers; pressure, temperature, and level transmitters; control valve cut-outs; vibration monitoring systems; Woodward turbine speed controllers; relay systems and motor controls

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engro markaz launch & inauguration:

Engro Markaz is one of the flagship projects of Engro Fertilizers, offering farmers the facility to directly purchase products from the company through Engro Markaz’s outlets. Our network of company-operated outlets currently includes four active locations: Sahiwal (350 MT Capacity), Sargodha (900 MT Capacity), Muridke (110 MT Capacity), and Bahawalpur (220 MT Capacity).

At the start of the year, Engro Markaz Muridke was inaugurated on 26th January 2025 by Rana Tanveer Hussain, Federal Minister for Industries & Production, National Food Security & ��

Addressing the gathering, Federal Minister Rana Tanveer Hussain re-iterated Government's commitment in the growth of Pakistan’s agriculture sector and improving the livelihoods of farmers. He said that the Government and fertilizer industry are working together to ensure uninterrupted availability of fertilizers at controlled prices for the farmers. He appreciated Engro Fertilizers for supporting the Government’s initiative of setting up Engro Markaz in various districts to help curb hoarding and price manipulation by intermediaries.

Speaking at the occasion, Ali Rathore - CEO Engro Fertilizers, acknowledged Government’s focus on development of the agriculture sector and well-being of farmers. He further added that Engro Markaz will offer relief to the farmers by ensuring timely availability of high-quality fertilizers at �� products and technologies that can help improve our crop yields and bring them in line with global benchmarks.

In the later half of the year, Engro Markaz - Bahawalpur was inaugurated on 13th November, 2025 by Syed Ashiq Hussain Shah Kirmani - Provincial Minister Agriculture. While addressing the audience, He greatly appreciated Engro Markaz’s role of playing a pivotal part in strengthening farmer outreach and supporting effective interaction between the farming community and Engro �� agri-extension members and the farmer community.

The inauguration event was followed by seed distribution activity that took place at Engro Markaz Bahawalpur and was graced by Syed Ashiq Hussain Shah Kirmani - Provincial Agriculture

rooted in 261 character driven leadership

rooted in character 262 driven leadership

engro fertilizers limited annual report 2025

Minister and Iftikhar Ali Sahoo - Secretary Agriculture. More than 2700 wheat seed bags and vegetable kits were handed over to six thousand farmers affected by the floods in Districts of Bahawalpur, Multan, Khanewal and Muzaffargarh. This activity marked Engro’s strong commitment in supporting flood impacted farmers in particular and agriculture in general across Punjab.

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engro markaz campaign:

Engro Markaz merchandising campaign was strategically rolled out across all four Engro Markaz outlets at Muridke, Sahiwal, Sargodha and Bahawalpur in 2025. The primary aim was to create brand awareness among farmers during the peak season through the following touch-points:

Digital Engagement: The campaign featured digital airing of Engro Markaz infomercial and other informative posts across social media platforms, ensuring campaign’s visibility being extended beyond physical touchpoints to reach a broader audience. To further amplify �� promotions. This multi-channel digital strategy helped solidify the brand’s presence during the season.
Merchandising Activity: Engro Markaz outlets - external space was fully branded, creating a strong visual presence. In addition, billboards were installed at key locations along the main routes leading to each outlet, ensuring that farmers traveling to the outlets were continuously exposed to the brand message. A comprehensive range of point-of-sale material (POSM), including flyers, standees and posters were deployed within the outlets to create awareness among farmers.
Digital Interventions: The platform ensures real-time pricing transparency, secure digital

�� new benchmark for innovation in the agricultural sector, Engro Markaz has registered over 661 farmers, processed PKR 395 million in sales over its lifetime, with an initial investment of PKR 3.7 million enabling farmers to purchase genuine products at manufacturer-set prices through SAP-integrated retail outlets, eliminating reliance on traditional intermediaries.

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engro fertilizers digital outreach:

Throughout 2025, Engro Fertilizers effectively bridged the gap between on-ground conversations and digital engagement by maintaining a robust presence across all major digital platforms, including Meta, YouTube, and TikTok. Ensuring ongoing interaction with its audience by simplifying complex technical information, making it accessible and educational for farmers to help them increase their crop yields. Through initiatives aimed at empowering and uplifting �� our ambassadors “Shaandar Kissan”. These included:

��
Engro Shaandar Kissan Kay Saath: A digital series where we take a closer look at growers as they take us through a day in their lives, sharing experiences that are instrumental in achieving higher crop yields.

�� experts come together for open dialogue and practical solutions to prevailing challenges.

Through these initiatives, Engro Fertilizers has reached millions of farmers online, establishing ��

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engro zabardast urea campaign

Following the success of Engro Zabardast Urea’s (EZU) breakthrough thematic campaign in 2024, EZU’s communication strategy evolved to focus on its functional differentiation – its patented Bioactive Zinc Technology. This transition led to the launch of EZU’s new anthem, “Jab Urea Tum Ko Lena Ho, Bioactive Zinc Wala Ho,” which became the core expression of EZU’s �� communities, as listed below:

�� to launch its clutter breaking, end-to-end AI based communication that ran across national & �� through AI including characters, visuals, voiceover and story-telling inspired by real farmer experiences and issues.
Media Airing: To create massive awareness, EZU bioactive zinc TVC was aired on major national TV channels and Sindh focused regional channels with special focus on prime time road blocks and frequency build up.

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Digital Airing: A targeted social media campaign was rolled out across Meta, YouTube and TikTok platforms reaching millions of farmers online and ensuring strong visibility during the kharif season, effectively reinforcing the message among the target audience – i.e. farmers and agricultural communities across digital channels.
Out Of Home (OOH) Branding: Communication was further strengthened through installation of billboards across high-visibility key rice-growing territories nationwide and creative wall murals on main roads approaching mandis to create awareness and hype about Engro Zabardast Urea’s campaign launch.
Dealer Shop Branding & Merchandising Drive: Engro Zabardast Urea merchandising drive was initiated nationwide covering south, central and north zones during the kharif season covering nationwide dealer shops, reinforcing consistent messaging of “bioactive zinc” and driving recall among farmers at peak purchase touchpoints through point of sale material (POSM) including posters, banners, buntings, danglers and on-ground display through bori poles and life size inflated boris.
�� products and as part of the EZU campaign, flipcharts were designed and distributed to the regional teams. These were then used during farmer meetings reaching thousands of farmers in 2025.

Overall, the campaign strengthened the positioning of EZU as the category-leading, nutrient-smart fertilizer and reflected Engro’s commitment to drive meaningful, technology-enabled impact in the ��

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engro consumer incentive scheme (CIS):

As Rabi season is a critical window for Pakistan’s wheat crop, Engro Fertilizers planned the biggest ever consumer engagement drive to generate farmer pull within the Urea category with Engro Urea and Engro Zabardast Urea through “Engro Jeet Ki Baazi” consumer incentive lucky draw scheme .tt

(CIS). Engro Jeet Ki Baazi deployed a high-impact, multi-channel strategy to strengthen nationwide awareness and on-ground farmer connection as this was one of Engro’s highest visibility campaigns generating massive hype and driving exceptional conversion through over whelming farmer participation. The communication for this was also AI developed.

The CIS activity was designed to reward farmers through trial generation and to drive repeat purchases. Scratch-card coupons were placed inside Engro Urea and Engro Zabardast Urea bags on �� had to send his complete details via the special SMS code “9986” to qualify for the lucky draw.

Media roll out: To generate campaign awareness and massive hype, the campaign featured an extensive media rollout, including a TVC/DVC aired across all major TV channels – with key focus on prime-time roadblocks and frequency build up and a full-funnel social media campaign across Meta, YouTube, and TikTok, reaching millions of farmers online.
Out Of Home (OOH) branding: Communication was further strengthened through installation of billboards nationwide across North, Central and South zones.
�� robust point of sale material (POSM) merchandising drive across dealer/retail touchpoints.
�� and guide farmers for Engro CIS mechanics and participation during the season’s ongoing farmer meetings.
Engagement through Influencers: Regional influencer content in local languages by popular content creators further strengthened engagement and cultural relevance.
Lucky Draw Activity: Four live-streamed lucky draw sessions on Facebook were conducted on Nov 14, Nov 28, Dec 19, 2025, with the last one planned for Jan 16, 2026. Winners were announced via balloting and testimonials of winners were shared online, further strengthening credibility and generating positive word-of-mouth.

On a large-scale, Engro Jeet Ki Baazi-CIS campaign has emerged as one of the most comprehensive and farmer-centric Rabi campaigns, reinforcing Engro’s commitment to supporting dealers, farmers and agriculture communities.

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engro triple super phosphate (TSP) launch:

Engro Fertilizers recently expanded its base business product portfolio with the launch of Engro Triple Super Phosphate (TSP), a high quality fertilizer containing 46% Phosphorous - imported from OCP Nutricrops, Morocco and introduced by Engro Fertilizers in Pakistan to support enhanced crop nutrition, stronger root development and plant germination.

Digital Communication: An all-new AI-powered Digital Video Commercial (DVC) was developed for Engro TSP, positioning it as the most effective solution to farmer affordability challenges. The �� offering 46% phosphorus, making it the highest-phosphorus option available to farmers.
Social Media Campaign: To support the rollout, an extensive digital awareness campaign for Engro TSP was executed across key social media platforms, including Meta, YouTube, and TikTok. To effectively reinforce the message among the target audience-farmers and agricultural communities across digital channels.
On-ground Activation: An extensive merchandising drive was conducted at 1000 dealer outlets through point-of-sale materials nationwide across south, central and north zones.
Market Development Activities: To educate and create awareness among farmers about the �� along with 20+ demo plots.

These initiatives aim to create strong awareness, drive product adoption, and strengthen Engro TSP’s brand equity at the farmer level. With this launch, Engro Fertilizers continues to uphold its purpose of enriching lives and enabling growth through sustainable agricultural innovation.

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international crop seminars on phosphate and potash:

Crop Seminar – Potash: The international seminar “Unlocking Agricultural Potential: Potassium for Sustainability and Productivity” was held on February 4th, 2025, in Hyderabad, in collaboration with Agriculture (Extension) Sindh. Over 200 agricultural stakeholders, including farmers, academia, �� fertilizers in improving crop resilience, quality and productivity.

Munir Ahmad Jumani, Director General Agriculture (Extension) welcomed the audience and emphasized on the importance of potassic fertilizer as a quality nutrient and Engro as a trustworthy partner in providing innovative solutions to the farmers. The seminar featured technical presentations from various experts, including Dr. Munir Al Rusan, Professor Jordan University of Science and Technology (JUST), who highlighted the importance of balanced fertilization through 4R nutrient

stewardship, as well as Professor Dr. Ghulam Murtaza Jamro from Sindh Agriculture University, Dr. Ameen Qureshi, Director Agriculture (Extension) and Ijaz Ahmad from Engro Fertilizers. The event concluded on a vote of thanks address by Syed Shauzab Hassan Gardezi from Engro Fertilizers.

Crop Seminar - Phosphorous: An international seminar on “Phosphorus – the Hidden Driver of Food Security and Climate Smart Farming” was hosted by Engro Fertilizers in Faisalabad, a collaborative initiative with the University of Agriculture, Faisalabad (UOAF) and OCP Nutricrops. The event brought together more than 300 agricultural stakeholders including farmers, academic experts, researchers and a distinguished international delegation from OCP Nutricrops, Morocco. The seminar highlighted the essential role of phosphatic fertilizers in sustainable agricultural productivity, with a particular focus on Engro Triple Super Phosphate (TSP).

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baithak dealer convention:

Engro Fertilizers hosted successful dealer conventions, known as “Baithak” in three key business �� impressive turnout of over 200 dealers per event.

The positive response from our dealers was notable, who acknowledged Engro Fertilizers efforts to foster a healthy working relationship and instill accountability throughout the entire process. Our t

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dealers’ resilience, performance and commitment to excellence were at the heart of these gatherings. Engro Fertilizers’ senior leadership engaged directly with the dealers; fostering open dialogue, mutual �� the strength of our shared vision and the deep trust that forms the foundation of our network.

engro kissan convention – bahawalpur:

Engro Kissan Convention with the messaging “Khushal Kissan, Khud Kafeel Pakistan” was held in Bahawalpur in which more than 600 farmers participated. The event was graced with the honorable presence of Syed Ashiq Hussain Shah Kirmani – Provincial Minister Agriculture as the chief guest. The event was organized to engage and empower farmers with knowledge on modern agricultural practices and quality fertilizers and provided a platform for direct interaction, guidance, and support - reinforcing Engro Fertilizers’ commitment to farmer development and sector growth.

dealer merchandising initiative:

Engro Fertilizers has taken a step forward in strengthening its brand presence on-ground by transforming 200+ dealer shops across 48 territories nationwide covering the South, Central and North Zones. In a highly competitive marketplace - our strategy was to own the outdoor branding space of fertilizer mandis and dealer outlets, ensuring that Engro as a brand stands out distinctively amongst the clutter. This branding initiative ensures our consistent and powerful on-ground presence that enhances Engro’s brand awareness and the deep-rooted partnership with our farmers and dealers whom we proudly serve.

KPK region branding:

Engro Fertilizers initiated Engro Urea and Engro DAP awareness drive through KPK region branding that included bori poles, life-sized inflated bori displays on ground in front of dealer shops, Available Here Signs (AVH) and Point of Sale Material (POSM) activation at dealer outlets. This on-ground visibility drive enhance Engro Urea and Engro DAP awareness among the farmers that generated word of mouth publicity and brand equity.

dealer engagement activities:

As a gesture of appreciation, a customized Engro-branded blue pottery tea set was gifted to our dealers on the occasions of Eid and Diwali, acknowledging their efforts and celebrating these meaningful festivals.

engro rahbar hotline for continuous customer feedback and queries

Rahbar is Engro’s call center set up to provide a platform to our end consumers (farmers) and customers (dealers) for voicing their feedback. All dealers and customers have access to the system to reach out for any query, consultation, on-farm advisory matters, provide valuable feedback to the company or register a complaint related to order management and delivery, etc. The details of the hotline are given below.

Toll-free number: 0800-001-10

Rahbar is also now equipped in combating the counterfeiting issues through IVR message that educate farmers to verify originality of the product through bharosa seal initiative on packaging. Farmers can verify product authenticity by sending the bharosa seal code to 9934 or by scanning the ��

In 2025, we also utilized Rahbar for Engro Customer Incentive Scheme, using their SMS number 9986 to collect entries for the lucky draw.

Stats for 2025

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Categories Total
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Complaint	42
Feedback/Suggestion	19
Inquiry	3,746
Request	215
Total CMS Entries	3,998
Number of Inbound Calls Offered	87,655

buland program

Launched in 2024, Buland was designed as a focused intervention to strengthen the technical and economic capacity of smallholder female farmers. The program addresses practical challenges across the crop lifecycle, with training modules covering land preparation, sowing and crop establishment, irrigation and nutrient management, pest and disease control, use of inputs and machinery, harvesting, market linkages, and value addition.

The initial phase of the program required overcoming cultural and operational barriers, including language constraints and limited mobility of female farmers. Through localized delivery models and the engagement of female Agri-Resource Persons, EFERT successfully enabled participation �� effectiveness of the approach and provided the basis for expanding the initiative.

During the year, EFERT scaled the program through Buland 2.0 and Buland 3.0 in Pakpattan, in collaboration with the Farmers Development Organization (FDO). Female farmers are trained through ��

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Program Year Crop/Season Geographic No. Of No. of Female Average
Phase Coverage villages Farmers Yield (%)
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||||||||
|---|---|---|---|---|---|---|
|Buland 1.0|2024|Wheat|Jhang|20|400|32%|
|Buland 2.0|2024|Rice|Pakpattan|20|400|13.7%|
|Buland 3.0|2025|Wheat|Pakpattan|20|550|TBA|

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engro humsafar

The Humsafar Platform was upgraded to enhance the system’s stability, and capacity to support higher transaction volumes, particularly during peak usage. As a result, the risk of unexpected downtime has been materially reduced, improving overall system availability and reliability.

Maintaining business continuity was a key priority throughout the upgrade. All integrations with banking partners, including 1LINK, remained fully operational, and the transition was completed without any disruption to users or external stakeholders.

To minimize operational risk, a controlled change window was implemented, permitting only �� system meets required standards.

�� and management. Overall, the upgrade eliminates technology obsolescence risk, strengthens operational ��

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engro fertilizers limited
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rooted in
character 50
driven leadership
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engro leadership competency model
Takes responsibility
Engages truthfully and
constructively
Makes sound decisions
with integrity and courage
Core Value Develops self and others
Leads with empathy and
Strives to achieve the highest humility
standards of character and good Builds relationships based
manners in all interactions
on trust
Nurtures passion to serve company,
Continuously seeks community, and country
improvement
Solves problems creatively
Overcomes setbacks with Cares deeply about environmentalimpact and safety in our activities
resilience across the country
Helps and seeks helps
Values diverse perspectives and people
Promotes ‘one team’
engro fertilizers limited
annual report 2025
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engro leadership competency model

the guiding principles of character & good manners (CGM)

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human capital

developing our people

The development of our people remains at the heart of our company as we enable growth for Engro Fertilizers. Upholding the values of Diversity, Equity, and Inclusion (DE&I) and ensuring we foster a culture that makes everyone feel welcomed, included, and represented, where their efforts receive due recognition and their development and experience are of utmost importance to EFERT's success. Employee centricity, the highest standards of business ethics and integrity, and world-class standards for the workplace is the Engro way.

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employee data 2025
total employees
2025
on headcount basis
1,185
The overall gender
diversity ratio stands
Male Female at 11.2%
1,089
87
C-1 (Female
Employees): Gull Zareen
Khan, General Manager
- HRBP and Nazia Ali,
General Manager -
Digital Transformation
by age
<30 30-50 >50
236 751 198
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by location

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Head Office Daharki Zarkhez Faisalabad Hyderabad Lahore Multan Sukkur Sahiwal
110 716 50 33 66 61 97 28 24
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by employment type

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On headcount basis 2025
Total number of employees 1,185
Number of permanent management employees 716
Non Management Permanent Employees 469
Number of contractual/temporary employees 101
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HR governance process

EFERT recognizes its "People" to be its most valuable asset and therefore People development �� personify the Company's values, ensuring continued excellence is the foundation for a sustainable and growing company. We recognize the importance of human capital and its critical role in creating value creation potential for our businesses and a successful corporate echo system.

Therefore, EFERT's Board places great importance on people’s development and related policies and processes which are at the heart of our core values and our People leadership competencies model. To ensure dedicated focus on HR matters, the Board has established the Board People Committee (BPC) that exercises oversight over HR policies and systems and is responsible for the review of performance evaluation, development, and succession plans of its People. The BPC is also responsible for independent review and stewardship of all HR matters including compensation, organization training, and development of people.

The Company has a clearly documented Human Resource management policy that aims to �� willing to contribute their best towards the accomplishment of Company objectives. This is available for easy access on the internal company portal of SuccessFactors. Any changes to the same are regularly shared with employees through the internal communications team. To complement this policy several other policies have been developed for recruitment, compensation, and organizational development.

EFERT’s HR policies encompass these principles:

equal opportunity

�� applied induction standards.
Create a work environment where every employee has an equal opportunity to develop their skills and talents.

training and development

To meet employee and organizational needs, provide opportunities to employees for acquisition of knowledge for technical and managerial skills through classroom and on-the-job learning.

compensation and benefits

Rewards policies aligned with the best companies in the market that compete for high-quality talent.
Clear linkage of reward policies with performance and potential. diversity and non-discrimination

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diversity and non - discrimination

��
Contributory provident fund
Provide an environment free from all forms of discrimination and harassment at the workplace.
Foster gender diversity at all levels within the Company.
EFERT pension fund
Service incentive plans
Policies aimed at creating flexible and conducive working arrangements.

job evaluation

We are committed to fostering an inclusive workplace where differently abled individuals are �� ensure comfort. We have also partnered with the Karachi Down Syndrome Program (KDSP) internship program to provide individuals with Down syndrome meaningful corporate exposure and essential workplace skills.

�� efforts, reinforcing our commitment to equitable opportunity and inclusive growth.

performance management

Have a transparent and merit-based performance management system in place.
��

EFERT's HR policies are approved by the BPC and Board, and are stewarded by the Management Committee and Board periodically. The most senior management position that is responsible for HR matters is the Head of Human Resources at the company level, who directly reports to the �� are also managed at group level by Engro's People division based at the holding company.

Furthermore, industrial relations at plant sites are managed by the respective Admin Department at the plant.

The HR function was recently re-modeled to improve HR functional services by HR Business �� line with its shared vision.

faida flex

�� family situation, and health needs. Under this program, each employee receives a flexible wallet ��

employee remuneration policies and processes

The Company's HR policies ensure competitive and appropriate compensation and remuneration for its employees based on their roles, experience, and performance. Employee remuneration for management employees is determined by regular market surveys and comparison with the relevant competitive markets and guided by Company policies.

�� programs mentioned below are currently in place for our employees.

All our positions are job description based. Engro has initiated a group-wide job evaluation exercise utilizing the Korn Ferry Hay Method to measure the relative size of its roles, relying on the world’s leading method to determine the fair and objective relative value of each role in the organization.

gender pay gap disclosure

At Engro, we are committed to fostering an inclusive and equitable workplace where all employees have equal opportunities to grow and succeed. Our compensation philosophy is built on fairness, transparency, and meritocracy, ensuring that pay is determined by an individual’s competence, years of experience and performance. We believe in rewarding employees for their contributions and the value they bring to our organization. To uphold our commitment to fairness, we regularly review our compensation structures to ensure alignment with industry standards and internal equity.

For reporting gender parity, we have used the following calculation assumptions to determine the Male-to-Female pay ratio, which stands at 1:1.20 (mean) and 1:1.13 (median).

Band-wise breakup
Age-wise brackets based on average
Below is the breakdown by grade level:

The Gender Parity Pay Gap for 2025:

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Grade Mean Median
M4 0.66 0.68
M3 0.99 0.91
M2 0.96 0.91
M1 1.13 1.04
P4 0.96 0.92
P2 0.84 0.80
AVG 0.99 0.94
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We remain dedicated to continuously monitoring and improving pay equity, ensuring that all employees – regardless of gender – are recognized and rewarded equitably for their contributions.

details of retirals and long-term benefits are as follows:

The Company maintains separate gratuity schemes for its employees. Employees are eligible for these schemes based on completion of the vesting period. Trustees of the Fund are responsible

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for administering these funds. The annual contributions to gratuity and management staff funds �� fund for its permanent employees.

Monthly contributions are made both by the Company and employees to the fund at the rate of 10% of the basic salary. Additionally, a service incentive plan is also maintained for certain categories of employees to reward them for their service of at least 3 years with the company.

��

Health Insurance
Life Insurance
Part- Time work policy
Compensation cars
��
Hajj policy

paternity leave

Engro offers 15 days of paid paternity leave.

access to female hygiene products

Engro also provides women with access to female hygiene products free of cost at the workplace.

off-track policy

To support continuous learning and personal growth, employees may opt for a sabbatical of up to one year. This "Off-Track" option facilitates advanced education, skill enhancement, family care, or community service, ensuring our talent returns recharged and further enriched.

mental wellbeing

We prioritize the psychological health of our workforce through dedicated wellness initiatives, providing resources and professional support systems such as Saaya to ensure a resilient and balanced organizational culture.

Annual incentive bonus and performance bonus
Paternity / maternity leaves and sabbatical leaves
��
Long service awards
• Loans and advances • Club memberships
Beach Huts and lodges
Day Care
��

job evaluation

Engro has initiated a group-wide job evaluation exercise utilizing the Korn Ferry Hay Method to measure the relative size of its roles, relying on the world’s leading method to determine the fair and objective relative value of each role in the organization.

transportation services for female staff

Engro provides an allowance for safe and hassle-free mobility solutions for female employees. This eases the commute for women at Engro as part of the Company’s diversity, equity, and inclusion initiatives. This travel policy complements other initiatives introduced by Engro to create a gender-diverse workforce.

daycare facility

To facilitate women employees in the organization, Engro offers special daycare facilities at the �� These initiatives are designed to ease the transition back into the workforce, promote workplace inclusion, and enable continued career progression.

inclusive childcare support

To empower our female colleagues—particularly those at our manufacturing plants—the �� childhood arrangements, reducing barriers to career progression.

family-centric travel & accommodation

Recognizing the challenges of work-life integration for nursing mothers, we facilitate travel for children (up to 2 years old) and one adult companion. By covering these expenses, we ensure our employees can meet professional demands without compromising family bonds.

long service benefits

At Engro we use long service awards as a way to recognize and celebrate employees' dedication, loyalty, and sustained contributions over an extended period. These awards acknowledge the value of long-term commitment, fostering a sense of appreciation and belonging, while also reinforcing the organization's culture of recognizing and rewarding consistency and perseverance. They serve as a motivational tool, promoting employee engagement and retention by highlighting the importance of long-term service to the company's success. Employees receive gold coins after 5, 10, 20, 25, and 30 years of service.

policy roadshow

To continue creating awareness about HR policies, the Rewards team regularly conducts road shows to improve the understanding of the updated and reviewed policies. These awareness sessions not only enable employees to be cognizant of HR policies but also provide a platform where they can voice their opinions and provide feedback.

people and talent development

maternity leave

Engro offers 6 months of paid maternity leave.

Engro launched the second cohort of Talent Development Program (TDP), which is a documented and structured framework of talent development to identify future leaders amongst the talent in

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the organization. This program provided an opportunity to develop talent who demonstrated ��

In 2025, EFERT demonstrated a strong commitment to people and talent development, with 13 employees selected for this program - the highest representation among all subsidiaries.

The development of these individuals is actively managed through tailored Individual Development Plans (IDPs), to prepare them for “Key Roles” across the group aligned with future �� of ready talent for succession planning which safeguards engagement of talent within the organization and uninterrupted continuity of business.

�� organization's unwavering dedication to creating an environment that nurtures both personal and professional growth.

E.D.G.E (empowering development, growth and excellence)

In 2024, EFERT launched EDGE, a two year, pioneering leadership development program designed to identify and cultivate future leaders from among the organization’s high performing talent. The program focuses on building a strong leadership pipeline by providing structured development opportunities aligned with both individual potential and organizational needs.

EDGE is anchored around four key pillars:

Developing women through targeted leadership programs
Developing high performing and high potential employees
Mentoring and coaching for senior leaders
Enabling senior leaders to support Assistant Manager (AM) and Deputy Manager (DM) level employees in creating structured Individual Development Plans (IDPs)

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The remaining three pillars of the EDGE program will be rolled out in 2026, with a strong emphasis on team empowerment and leadership capability building. These initiatives will include:

One on one feedback and coaching cascaded by senior leaders
EDGE Ambassadors supporting teams in creating effective Individual Development Plans
• Launch of the Women Empowerment Program 2026

succession planning

EFERT's commitment to ensuring seamless business continuity is evident through its robust succession planning strategy. By creating a talent pipeline for future leadership positions, EFERT aims to guarantee uninterrupted operations even in times of transition. Central to this approach is the emphasis on skill enhancement tailored to meet current and future business demands, ensuring readiness to navigate dynamic environments. Throughout this process, people development remains at the forefront, with EFERT acknowledging the inevitability of change and prioritizing the growth and development of its workforce. To facilitate career progression and talent development, EFERT has meticulously charted employees' career paths, taking into account factors such as potential, experience, and demonstration of Engro competencies. Each employee is provided with ample opportunities for training and development, alongside the necessary resources and equipment to excel in their respective roles. This holistic approach not only ensures the individual growth and satisfaction of employees but also strengthens EFERT's overall organizational capabilities, positioning it for sustained success in the long run.

learning and development

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Female Male Grand Total
Sum of No. of Hours 1,758 12,017 13,775
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ACE (achieve, champion, elevate)

In 2024, EFERT proudly launched the ACE (Achieve, Champion, Elevate) program, an initiative where innovation meets inspiration. This program brings together industry experts, startup pioneers, and emerging leaders to ignite meaningful discussions, drive critical conversations, and foster professional growth. ACE is designed to push boundaries and stimulate innovative thinking, positioning participants for success in a rapidly evolving industry. The inaugural session features a renowned expert delivering invaluable insights, setting the stage for a series of impactful engagements. Further details on upcoming sessions will be shared soon, marking this as a key step in EFERT’s commitment to talent development and sustainability.

During the year, four insightful sessions were held featuring:

�� with experienced senior leaders as coaches. These coaching engagements were designed to �� plans. The resulting IDPs are scheduled for execution in 2026, ensuring continuity and measurable progress.

Abrar Hasan, Global CEO of National Foods, spoke about Exploring Growth Strategies in a Challenging Economy
Mujtaba Khan, CEO of Reon Energy, shared valuable insights on Climate Mitigation and the Future of Energy

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Mohammad Shamoon Chaudry, CEO of Dawood Hercules, delved into the rich legacy of Dawood Hercules Corporation and Engro
Umar Ahsan Khan, Managing Director and CEO of Dawlance, shared his insights on Workplace Burnout and the Gen Z Mindset

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ACE Series Part II:

Building on the success of our industry-expert dialogues, the second phase of our program focused on the power of internal mentorship. By leveraging the diverse intellectual capital within the Engro ecosystem, we provided our teams with direct access to the strategic blueprints of our other subsidiaries.

Impactful Community Engagement from Within

�� by three key pillars:

Cross-Sector Synergy: Sessions led by Abdul Qayoom Shaikh (CEO, Engro Polymer and Chemicals) provided critical insights into operational excellence and industrial safety, translating complex manufacturing challenges into actionable leadership lessons for our fertilizer teams.
Strategic Resilience: Ammar Shah (CEO, Engro Vopak & Elengy Terminals) shared perspectives on navigating global supply chain volatilities and energy transitions. This dialogue empowered our emerging leaders to think globally while acting locally.
Institutional Memory & Mentorship: These sessions serve as a conduit for institutional wisdom. By sharing "battle-tested" experiences, our CEOs humanize the leadership journey, encouraging a culture transparency, psychological safety, and bold ambition. Through the ACE Series, we are not just sharing information - we are building a more cohesive, resilient, and inspired community of professionals who are equipped to lead Engro into the future.

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1 on 1 feedback conversations

This training module is tailored to cultivate effective feedback communication skills in our Team and Division leads, enabling collaborative growth and transparency in our appraisal and feedback �� population of 19 General Managers across the Company. We reinforced our performance culture by providing all employees with practical toolkits for effective 1-on-1 dialogue. These guidelines standardized how team members and managers communicate, ensuring feedback is transparent, constructive, and results driven.

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----- Start of picture text -----

time for the monthly check-in with your
line manager!
your monthly1:1 with your manager is
more than meeting - it’s your space to
rereflect, realign and recharge,
----- End of picture text -----

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rooted in 283 character driven leadership

rooted in character 284 driven leadership

engro fertilizers limited annual report 2025

engro fertilizers limited

annual report 2025

In 2025, we hosted an immersive leadership residency in Daharki for our senior executive tier, centered on institutionalizing effective feedback mechanisms across the organization. The program prioritized the dual competencies of delivering and receiving constructive critique, while emphasizing continuous dialogue as a strategic tool for performance management, professional development, and organizational alignment.

Building on this foundation, 2026 will see these senior leaders act as trainers, cascading this �� communication culture.

leadership launchpad

Leadership Launchpad is a 10-day intensive management development program for mid-level executives involved in shaping the growth and future of the organization. This tailor-made program is designed to equip our future leaders to navigate the challenges associated with steering the future of our business and adapting to an evolving workforce.

Building on the success of its inaugural launch, the Management Development Programme (MDP 2.0) evolved this year into a cross-functional initiative. Developed and delivered in partnership with KSBL faculty, this intensive seven-day residency provided 34 diverse participants from all �� leadership communication.

A key highlight of this year’s curriculum was the integration of Advanced Digital Literacy, featuring specialized modules on AI essentials, supply chain optimization through AI, and immersive AI-driven simulations. By expanding the nomination criteria beyond the marketing division, we have successfully democratized high-level strategic training, ensuring our leadership pipeline is equipped for a tech-driven future.

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campus to corporate

This workshop equipped Graduate Trainee Engineers and Management Trainees with essential skills and insights necessary for a successful transition into the corporate environment. From understanding workplace dynamics to honing professional communication, our experienced internal facilitators offered valuable advice and practical strategies to ensure smooth adoption.

character & good manners

A series of Character and Good Manners (CGM) training were conducted by CGM ambassadors for 100% management employees of Engro (L2 to P1) to inculcate the principles of character-based leadership i.e., TTHIS: Truthfulness, Trustworthiness, Humility, Integrity, & Striving in times of hardship. These sessions emphasized on self-reflection and how these values of character-based leadership can help foster credibility, teamwork, and resilience, while creating value for all the stakeholders.

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employee engagement 2024

We believe that our employees are our greatest asset. Our success is driven by our ability to build high-performance teams within a culture of inclusiveness, professionalism, and excellence. �� management that can further enhance our competitive edge in attracting and retaining talent.

Engro recognizes that employee engagement is critical for retaining value talent and boost �� adaptable to our working environment.

Each year, we conduct a completely anonymous third part managed employee engagement survey, the results of which are shared with both employees as well as the Board. These results are analyzed and action plans are developed. The survey addresses following dimensions:

Purpose
Values
Puts People First
Encourages Innovation & Change
Collaborates Openly
Acts with Ownership
Overall Leadership
Truth, Trust & Transparency
Diversity & Inclusion

Wellbeing
Engagement
Survey Follow-up

rooted in 285 character driven leadership

rooted in character 286 driven leadership

engro fertilizers limited

annual report 2025

During 2025 our engagement increased by 3% from 2024, results of employee engagement survey 2025 are as follows:

80% Employee Engagement Score

Response Rate

At Engro, we aim to score above the global average which, is close to 67%, as per Qualtrics (2023), Over the last few years, we have managed to remain above the target with variation on year-to-year basis. These results of engagement survey are analyzed by each division’s HRBP with the Division head to understand the factors that are encouraging as well as factors that need interventions and accordingly plans are designed to improve employee experience in those areas.

�� we have endeavored to establish continuous avenues for employee feedback, e.g., toenhalls by senior leadersip and quarterly dipstik surveys as well as focus groups with HR. At Engro Fertilizers, we believe that a high-performance culture thrives on continuous dialogue rather than a single annual survey. To transcend traditional corporate metrics, we established the Cultural Partners Committee - a strategic, people-centric platform designed to foster a homogenized and inclusive environment across all our locations.

cultural partners

In 2025, EFERT launched the Cultural Partners Committee, adopting a multi-faceted approach to strengthen employee engagement and enhance the overall employee experience. The initiative created structured avenues for feedback and dialogue, while also promoting engagement through workplace activities. Selected employees from across the organization were appointed as Cultural Partners, responsible for planning and coordinating activities locally while ensuring a consistent and synchronized culture across EFERT. Under this initiative, we had regular events, which included:

Partea with the Mums – Mother’s Day Celebration
• Dad’s Breakfast Club – Father’s Day Celebration
��
F1 Movie Night
Padel Connects
Halloween Trick or Treat

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ceo townhall

EFERT’s Q1 2025 Town Hall was held at the heart of Engro Fertilizers - our Plant Site in Daharki. CEO Ali Rathore then took the stage, delivering powerful insights on our Q1 2025 achievements, growth, sustainability, and the vital importance of HSE. He also emphasized the power of collaboration, consistency, and planning as the cornerstones of a winning attitude.

The audience was engaged through an interactive Menti session, where everyone enjoyed a lighthearted moment guessing which leadership member’s AI-genereated baby picture is who. Adding to the energy, our talented team prepared and performed a news-themed skit, humorously �� Pakistan, EFERT Live was a true celebration of our shared journey.

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Beyond the Q1 Townhall, Ali Rathore conducted band-wise sessions for P6 and above to facilitate targeted, high-level strategic alignment. These interactive forums allowed various groups to �� and inclusive corporate dialogue.

morning brew with ceo ali rathore

This is the second year, we introduced Morning Brew with CEO Ali Rathore, a series of regular sessions for employees to engage in open, unstructured discussions - no agenda, no formalities - just an opportunity for them to connect directly, outside of the usual formal settings, in an environment that encourages candid and constructive conversation.

Each session is an in-person, 2-hour meeting where employees in cohorts of 25 or less, are welcome to share their thoughts, ideas, and perspectives.

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rooted in 287 character driven leadership

rooted in character 288 driven leadership

engro fertilizers limited annual report 2025

connect corner with aneeq ahmad

Similar open, causal sessions are also held at Daharki with Aneeq Ahmed, Head of Manufacturing, a valuable opportunity for our employees at all level to voice their perspectives, share best practices, and explore ways to strengthen our organizational culture. The ideas shared on this platform are then turned into actionable steps to drive continuous improvement and strategic alignment.

departmental away days

To strengthen team connections and celebrate key milestones, departmental away days are organized on a regular basis. Recently, the HR, Finance, and Business Development teams also participated in away days at farmhouses and beach huts, creating opportunities to foster collaboration and enhance team bonding.

ennovate day

Originating as a series of Business Development (BD) Ideathons, which converted into an annual Ennovate Day representing a strategic shift towards a decentralized innovation model, �� ventures.

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This 6 month collaborative journey generated nearly 500 project ideas, culminating in a landmark forum in Daharki where 26 high-impact concepts were selected for their potential to drive scalable business value.

�� and fostering fresh intellectual perspectives, Ennovate Day has successfully transitioned curiosity into a formal, strategic engine for operational excellence and long-term organizational growth.

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internal campaigns

good manners = good vibes

To inculcate the habit of practicing good manners and professional etiquette, the Good Manners, Good Vibes campaign was launched featuring light-hearted, relatable memes with quirky one-liners.

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rooted in 289 character driven leadership

rooted in character 290 driven leadership

engro fertilizers limited annual report 2025

engro fertilizers limited

annual report 2025

forward looking statement

source of information and assumptions used for projections / forecasts

Engro Fertilizers Limited remains committed to forward-looking and disciplined planning to ensure sustainable long-term growth. Our forecasting process draws on a broad ecosystem of insights, including global and local macroeconomic developments, global fertilizer outlook, domestic sectoral dynamics, regulatory shifts, and internal performance indicators. These inputs help us anticipate emerging trends and understand their implications for the operating environment.

The Company has established sophisticated systems and models to analyze current trends and generate future projections. As the operating landscape continues to evolve, these tools enable us to interpret signals more holistically and strengthen the quality of our forward-looking assessments. While the external environment remains fluid, our planning discipline ensures that assumptions are periodically refreshed to reflect emerging realities and evolving market dynamics.

Internally, cross-functional collaboration between Manufacturing, Agronomy, Commercial, Supply Chain, Finance & Accounting, and Human Resources ensures a comprehensive approach to planning. This integrated model allows us to combine operational insight with market intelligence, enabling thoughtful assumption-setting and resilient strategies as the external landscape continues to evolve.

analysis of last year’s forward-looking statement / status of projects

2024 did not deliver the anticipated stability, with market dynamics weakening notably in the �� sentiment and operating conditions. It was only toward the end of 2025 that signs of recovery began to emerge, with a gradual improvement in demand and overall market tone. Throughout this period, EFERT upheld strong operational discipline and maintained cohesive organizational ��

Driven by our focus on operational excellence and reliability, EFERT delivered stable performance despite tougher market conditions. Sales revenue reached PKR 237.1 billion, down 7.6% from �� super tax and targeted discounts to ensure market competitiveness. Through consistent domestic production, EFERT continued to support national food security and generated over US$900 million in import substitution value.

A major structural development during the year was the government’s approval of an enhanced gas allocation framework for EFERT’s Base Plant. This decision addressed a longstanding

industry challenge and provided clear visibility on long-term feedstock and fuel availability, strengthening operational continuity and supporting sustainable planning. In line with our ��

Our continued focus on developing our product and service ecosystem remained a strategic priority. During the year, EFERT advanced initiatives to support balanced nutrient use and farmer capability building, including the rollout of Triple Super Phosphate (TSP) and strengthened agronomic engagement programs. In the specialty fertilizer segment, performance remained steady despite subdued market conditions.

On legal and regulatory front, the Company remained compliant with applicable requirements and continued its engagement with the relevant authorities. The Company recorded the required super tax provision in line with prudent accounting practices. In addition, EFERT continued constructive engagement with the relevant stakeholders for the renewal of its gas agreements based on the recent government approval for gas allocation and also for the agreements expiring in the near future with the objective ensuring long-term operational continuity.

forward looking statement

Engro Fertilizers Limited recognizes the continued importance of a resilient and productive agricultural sector to Pakistan’s economic future. As we move forward, our strategic focus remains centered on ensuring reliable availability of fertilizers at affordable prices, supporting national food security, and strengthening the agricultural value chain.

The enhanced visibility on future gas supply, as approved by the government during the year, provides a stronger foundation for operational stability and long-term planning. This development will enable us to continue delivering consistent production, support farmer affordability, and reinforce our contribution to import substitution and national resource conservation. We remain committed to operational excellence, strengthening asset reliability, optimizing costs, and enhancing productivity through disciplined execution. Our initiatives in farmer education, digital enablement, and responsible nutrient stewardship will continue to play a central role in promoting sustainable farming practices and improving outcomes across diverse cropping systems. Through platforms such as Engro Markaz, UgAi, and targeted agronomic engagements, we aim to advance adoption of balanced nutrition and climate smart practices at scale.

�� position us well to respond to evolving farmer needs. We will continue to build on these strengths by introducing value added solutions, enabling technology adoption, and ensuring seamless access through robust distribution and engagement networks.

EFERT maintains a strong commitment to responsible corporate citizenship. Our investments in community development, education, healthcare, livelihood support, and environmental sustainability will remain essential pillars of our long-term purpose. These initiatives reflect our belief that business growth must go hand in hand with meaningful social impact and environmental stewardship.

rooted in 291 character driven leadership

rooted in character 292 driven leadership

engro fertilizers limited

annual report 2025

response framework for future challenges and uncertainties

EFERT maintains a forward looking and adaptive framework to navigate future challenges in an evolving agricultural and economic landscape. During the year, developments in the gas allocation space provided greater visibility on future gas supply outlooks, allowing the Company �� Strengthened Enterprise Risk Management (ERM) practices and a more integrated GRC framework continued to support this approach by ensuring that key operational, regulatory, and market risks are assessed systematically and addressed in a timely manner. EFERT will continue to monitor the policy environment closely to safeguard competitiveness and maintain readiness for emerging uncertainties.

�� pressures, uneven crop outcomes, and changing input dynamics continue to influence buying behavior. To support farmers through these shifts, EFERT is steadily evolving from a purely product-led model to one focused on value-added services and integrated solutions including advisory, digital enablement, and on-ground capability building.

Recognizing liquidity pressures across the agricultural value chain, EFERT has also strengthened �� the Company’s ability to support working capital requirements in a market where farmers and dealers continue to face constrained capital availability. This ensures continuity of supply and enhances EFERT’s ability to sustain a service-oriented engagement model across the chain.

As part of broader industry engagement, the Company continues to participate in national policy discussions, including matters related to future gas supply and pricing framework. EFERT remains committed to working constructively with relevant stakeholders to ensure a balanced outcome that supports long-term operational stability and sectoral alignment.

Guided by strong governance, disciplined resource allocation, and an enduring commitment to safety, innovation, and sustainability, the Company is well-positioned to respond to emerging challenges while continuing to contribute meaningfully to national food security and long-term agricultural progress.

annual report 2025

rooted in 293 character driven leadership

rooted in character 50 driven leadership

engro fertilizers limited

annual report 2025

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statements

report of the board audit & risk committee for the year ended December 31, 2025

composition

Board Audit & Risk Committee (the Committee) is appointed by the Board and at the year-end it comprised of one Independent Director:

Category Name	Category Name
a. Independent directors	Mr. Mohammad Younus Dagha – Chairman
b. Non-executive directors	Mr. Asad Said Jafar – Member Mr. Farooq Barkat Ali - Member
c. Secretary	Ms. Mehreen Khalid – Head of Internal Audit (Jan 2025 – June 2025) Mr. Kalim A. Khan – Head of Internal Audit (July 2025 onwards)

�� Annual Report 2025.

��

The Head of Internal Audit of the Company functions as the Secretary to the Committee. The �� present in all committee meetings whereas external auditors are invited to the meetings on a requirement basis.

charter of the committee

�� which is duly approved by the Board of Directors. The salient features are stated below:

To recommend to the Board the appointment and removal of external auditors; �� To review the internal control systems and internal audit function;
To monitor compliance with complaints received through the Speak-Out / Whistle Blower Policy; To monitor compliance with statutory requirements;
To review the annual sustainability report and oversee compliance of sustainability related regulations; �� To oversee periodic HSE compliance through HSE dashboards.

role of the committee

The Committee assists the Board to effectively carry out its supervisory oversight responsibilities �� functions of the Company.

The Committee believes that it has carried out responsibilities to the full, in accordance with Terms of Reference approved by the Board which included principally the items mentioned below and the actions taken by the Committee in respect of each of these responsibilities. Evaluation of the Board performance, which also included members of the Committee was carried out separately and is detailed in the Annual Report.

The Committee has concluded its annual review of the operations of the Company for the year ended December 31, 2025 and reports that:

�� recommended them for approval of the Board;
�� December 31, 2025 have been prepared on a going concern basis under requirements of Companies Act 2017, incorporating the requirements of the Code of Corporate Governance, International Financial Reporting Standards and other applicable regulations;
�� subsidiaries for the year under review;
Appropriate accounting policies have been consistently applied and all applicable accounting �� December 31, 2025;
�� condition and results, compliance with regulations, applicable accounting standards and establishment and maintenance of internal controls and systems of the Company;
Accounting estimates are based on reasonable and prudent judgment. Proper and adequate accounting records have been maintained by the Company in accordance with the �� Schedule to the Companies Act, 2017 and the external reporting is consistent with management processes and adequate for shareholder needs;
Proper, accurate and adequate accounting records have been maintained by the Company; The Company’s system of internal control is sound in design and is continuously evaluated for effectiveness and adequacy;
The Company has issued a “Statement of Compliance with the Code of Corporate �� members of the Board, the Management and employees of the Company. Equitable treatment of shareholders has also been ensured;
The Committee has reviewed all related party transactions and recommended them for approval of the Board;
Reviewed and investigated whistleblower complaints received during the year, details of which can be found in Internal Audit, Ethics & Compliance section of the Annual Report.

rooted in 297 character driven leadership

rooted in character 298 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

risk management and internal control

�� appropriate criticality level and devising appropriate mitigation measures which are regularly monitored and implemented by the management across all major functions of the Company and presented to the Committee for information and review.
The Company has devised and implemented an effective internal control framework which also includes an independent internal audit function.
The Internal Audit department is responsible to provide independent opinion on whether the Company’s risk management, governance and internal controls processes are operating effectively.

internal audit

The Committee has ensured achievement of objectives relating to internal controls systems �� determination of appropriate measures to safeguard the Company’s assets
�� action or bringing the matters to the Board’s attention where required.
The Committee has provided proper arrangement for staff and management to report to the �� and other matters. Adequate remedial and mitigating measures are applied, where necessary. The Head of Internal Audit has direct access to the Chairman of the Committee and the �� the function has all necessary access to Management and the right to seek information and explanations.
�� and compliance with laws and regulations.

sustainability

The Audit and Risk Committee has reviewed annual Sustainability report and has recommended it to the Board for approval. The committee monitors and review sustainability related risks and opportunities, and overseas compliance of relevant laws and related disclosures.

external audit

The statutory auditors of the Company, A. F. Ferguson & Co., Chartered Accountants, have �� statements and the statement of compliance with the Code of Corporate Governance for the year ended December 31, 2025 and shall retire on the conclusion of the 17th Annual General Meeting; The Committee has reviewed and discussed audit observations with the external auditors. A meeting was also held with the external auditors in the absence of management; The external auditors have direct access to the Committee and Internal Audit Department, hereby ensuring the effectiveness, independence and objectivity of the audit process; A.F Ferguson & Co., Chartered Accountants also provides taxation and other statutory �� External�� statements.
The performance, cost and independence of the external auditors is reviewed annually by the �� with the applicable requirements regarding independence.
�� partner on the audit was Mr. Azhar Hussain being eligible for reappointment under the Code of Corporate Governance, the Committee has recommended to the Board, reappointment of A.F. Ferguson and Co., Chartered Accountants for the year 2026. A resolution to this effect has been proposed at the 17th Annual General Meeting.

annual report 2025

The Company has issued a very comprehensive Annual Report which besides presentation of �� information to offer an in depth understanding about the management style, the policies set in place by the Company, its performance during the year and future prospects to various stakeholders of the Company.

The information has been disclosed in the form of ratios, trends, graphs, analysis, explanatory notes and statements etc., and the Audit & Risk Committee believes that the Annual Report 2025 gives a detailed view of how the Company evolved, its state of affairs and future prospects.

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Mr. Mohammad Younus Dagha Chairman, Board Audit & Risk Committee

rooted in 299 character driven leadership

rooted in character driven leadership

300

engro fertilizers limited

engro fetilizers limited

annual report 2025 annual report 2025

statement of compliance with listed companies (code of corporate governance) regulations, 2019

Engro Fertilizers Limited

For The Year Ended December 31, 2025

Engro Fertilizers Limited (hereinafter referred to as (the "Company") has complied with the requirements of the Listed Companies (Code of Corporate Governance) Regulations, 2019, ("Regulations") in the following manner:

The total number of directors are Eight (8) in the following manner: a. Male: 7
b. Female: 1 *Including the CEO, who is a Deemed Director.
The composition of the Board is as follows:

Category	Name
Independent directors	Mr. Mohammad Younus Dagha Mr. Rizwan Khalil Sheikh
Independent Director-Female	Ms. Sadia Khan
Non-executive directors	Mr. Ahsan Zafar Syed Mr. Farooq Barkat Ali Mr. Ahmad Shakoor Mr. Asad Said Jafar
��	��

3.�� (7) listed companies, including this Company.
The Company has prepared a 'Code of Conduct' and has ensured that appropriate steps have been taken to disseminate it throughout the Company along with its supporting policies and procedures.
The Board has developed a vision / mission statement, overall corporate strategy and �� maintained by the Company.
All the powers of the Board have been duly exercised and decisions on relevant matters have been taken by the Board / shareholders as empowered by the relevant provisions of the Companies Act, 2017 (the "Act") and the Regulations.
The meetings of the Board were presided over by the Chairman and, in his absence, by a director elected by the Board for this purpose. The Board has complied with the requirements of the Act and the Regulations with respect to frequency, recording and circulating minutes of the meeting of the Board.
The Board has a formal policy and transparent procedures for remuneration of Directors in accordance with the Act and the Regulations.
All Directors have completed the Directors' Training Program. During the year, Mr. Ali Rathore, Mr. Farooq Barkat Ali and Mr. Rizwan Khalil Sheikh completed their Director’s Training Program. Furthermore, the Board also arranged Directors’ Training Program during the year for Ms. Gull Zareen Hasnat, BPC Secretary and who was also the head of HR during the year 2025.
The Board has approved appointment of the Head of Internal Audit. The Board has reviewed the remuneration and terms and conditions of employment and complied with relevant requirements of the Regulations.
11.�� (standalone and consolidated) before approval of the Board.
The Board has formed committees comprising of members given below:

a) Board Audit and Risk Committee

Mr. Mohammad Younus Dagha, Chairman Mr. Farooq Barkat Ali Mr. Asad Said Jafar

b) Board People Committee (HR & Remuneration Committee)

Mr. Rizwan Khalil Sheikh, Chairman Mr. Asad Said Jafar Ms. Sadia Khan

The terms of reference of the aforementioned committees have been formed, documented and advised to the committees for compliance.
The frequency of meetings of the committees were as follows: a) Board Audit & Risk Committee - Four meetings held during the year; and b) Board People Committee - Four meetings held during the year.
The Board has set up an effective internal audit function who are considered suitably ��and experienced for the purpose and are conversant with the policies and procedures of the Company. t

rooted in 301 character driven leadership

rooted in character 302 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

16 . �� satisfactory rating under the Quality Control Review program of the Institute of Chartered Accountants of Pakistan and registered with Audit Oversight Board of Pakistan, that they and all their partners are in compliance with International Federation of Accountants (IFAC) guidelines on code of ethics as adopted by the Institute of Chartered Accountants of Pakistan ��
The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance with the Act, these Regulations, or any other �� guidelines in this regard.
18 . �� have been complied with.
Explanations for non-compliance with requirements, other than Regulations 3, 6, 7, 8, 27, 32, 33 and 36 are below:

Nomination Committee and Risk Management Committee (Regulation 29 and 30)

The responsibilities of the Risk Management Committee and the Nomination Committee are �� establishing a separate committee for Risk Management and Nomination is not required.

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Mr. Ahsan Zafar Syed Chairman

Mr. Ali Rathore ��

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INDEPENDENT AUDITOR'S REVIEW REPORT

To the members of Engro Fertilizers Limited

Review Report on the Statement of Compliance contained in Listed Companies (Code of Corporate Governance) Regulations, 2019

We have reviewed the enclosed Statement of Compliance with the Listed Companies (Code of Corporate Governance) Regulations, 2019 (the Regulations) prepared by the Board of Directors of Engro Fertilizers Limited for the year ended December 31, 2025 in accordance with the requirements of regulation 36 of the Regulations.

The responsibility for compliance with the Regulations is that of the Board of Directors of the Company. Our responsibility is to review whether the Statement of Compliance reflects the status of the Company's compliance with the provisions of the Regulations and report if it does not and to highlight any non-compliance with the requirements of the Regulations. A review is limited primarily to inquiries of the Company's personnel and review of various documents prepared by the Company to comply with the Regulations.

�� audit approach. We are not required to consider whether the Board of Directors' statement on internal control covers all risks and controls or to form an opinion on the effectiveness of such internal controls, the Company's corporate governance procedures and risks.

The Regulations require the Company to place before the Audit Committee, and upon recommendation of the Audit Committee, place before the Board of Directors for their review and approval, its related party transactions. We are only required and have ensured compliance of this requirement to the extent of the approval of the related party transactions by the Board of Directors upon recommendation of the Audit Committee.

Based on our review, nothing has come to our attention which causes us to believe that the Statement of Compliance does not appropriately reflect the Company's compliance, in all material respects, with the requirements contained in the Regulations as applicable to the Company for the year ended December 31, 2025.

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A. F. Ferguson & Co. Chartered Accountants Karachi

Date: March 4, 2026

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UDIN:CR202510290cvLkRs4i5

rooted in 303 character driven leadership

rooted in character 304 driven leadership

engro fertilizers limited engro fetilizers limited annual report 2025 annual report 2025

engro fetilizers limited

consolidated financial statements for the year ended december 31, 2025

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INDEPENDENT AUDITOR’S REPORT

To the members of Engro Fertilizers Limited

Opinion

We have audited the annexed consolidated financial statements of Engro Fertilizers Limited (the Holding Company) and its subsidiary (the Group), which comprise the consolidated statement of financial position as at December 31, 2025, and the consolidated statement of profit or loss, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including material accounting policy information and other explanatory information.

In our opinion, consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at December 31, 2025, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with the accounting and reporting standards as applicable in Pakistan.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants as adopted by the Institute of Chartered Accountants of Pakistan (the Code), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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Following are the key audit matters:

Key audit matters How the matter was addressed in our audit S. No	Key audit matters How the matter was addressed in our audit S. No	Key audit matters How the matter was addressed in our audit S. No
1.	Revenue recognition (Refer notes 2.21 and 25 to the consolidated financial statements) Group’s net sales comprise of revenue from the sale of urea and other fertilizer products, adjusted by trade discounts and sales taxes and duties. Revenue from the sale of goods is recognised in the consolidated statement of profit or loss when control of the product is transferred i.e. when the product is dispatched / delivered to the customer. There is a presumed risk of revenue being overstated and recorded in incorrect period, based on our risk assessment. Accordingly, we have considered that there is a high level of risk of material misstatement of consolidated financial statements relating to revenue recognition requiring significant audit efforts to address the aforementioned risks. Therefore, this has been considered as a key audit matter.	Percentage Our audit procedures amongst others included the following: - obtained understanding and evaluated the accounting policies and the Group procedures with respect to revenue recognition; - examined contracts with customers to obtain an understanding of the terms particularly relating to timing and transfer of control of the products; - tested revenue transactions on a sample basis by inspecting underlying documentation including sales invoices and customer acknowledgement; - tested revenue transactions on a sample basis recorded before and after the reporting date with underlying documentation i.e. customer acknowledgement to assess whether revenue was recognised in the correct period; - obtained understanding of the types and process of discounts offered to customers and tested on a sample basis discounts provided to customers by examining supporting documentation including approvals of the discounts; and - assessed the adequacy of the related disclosures made in the consolidated financial statements with respect to the applicable accounting and reporting standards.

(Refer notes 2.21 and 25 to the consolidated Our audit procedures amongst others included the financial statements) following: Group’s net sales comprise of revenue from the - obtained understanding and evaluated the sale of urea and other fertilizer products, adjusted accounting policies and the Group procedures by trade discounts and sales taxes and duties. with respect to revenue recognition; Revenue from the sale of goods is recognised in the consolidated statement of profit or loss when - examined contracts with customers to obtain control of the product is transferred i.e. when the an understanding of the terms particularly product is dispatched / delivered to the customer. relating to timing and transfer of control of the Percentage products;
There is a presumed risk of revenue being overstated and recorded in incorrect period, - tested revenue transactions on a sample based on our risk assessment. Accordingly, we basis by inspecting underlying documentation have considered that there is a high level of risk including sales invoices and customer of material misstatement of consolidated acknowledgement; financial statements relating to revenue recognition requiring significant audit efforts to - tested revenue transactions on a sample address the aforementioned risks. Therefore, this basis recorded before and after the reporting has been considered as a key audit matter. date with underlying documentation i.e. customer acknowledgement to assess whether revenue was recognised in the correct period;
- obtained understanding of the types and process of discounts offered to customers and tested on a sample basis discounts provided to customers by examining supporting documentation including approvals of the discounts; and
- assessed the adequacy of the related disclosures made in the consolidated financial statements with respect to the applicable accounting and reporting standards.

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engro fertilizers limited

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annual report 2025

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Key audit matters How the matter was addressed in our audit S. No	Key audit matters How the matter was addressed in our audit S. No	Key audit matters How the matter was addressed in our audit S. No
2.	Income tax and Sales tax provisions and contingencies (Refer notes 2.17, 2.19, 3.2, 3.5, 24.2, 24.3, 24.7 to 24.12 and 33 to the consolidated financial statements) The Group has recognised provisions and has disclosed contingencies in respect of certain income tax and sales tax matters, which are pending adjudication before various appellate and legal forums. Provisions and contingencies require management of the Group to make judgements and estimates in relation to the interpretation of laws, statutory rules, regulations and the probability of outcome and financial impact, if any, on the Group for recognition and measurement of any provision and disclosure in respect of such provisions and contingencies. Due to inherent uncertainties associated with the outcome of the matters, legal forums at which these are currently pending and use of significant judgements and estimates to assess the same including related financial impacts, which may change over time as new facts emerge and the matters progress, we have considered income tax and sales tax provisions and contingencies as a key audit matter.	Percentage Our audit procedures amongst others included the following: - obtained and examined details of the documentation relating to pending tax matters and discussed the same with the Group’s management; - circularised confirmations to the Group’s external legal and tax advisors for their views on matters being handled by them; - checked correspondence of the Group with the relevant authorities including judgements or orders passed by the competent authorities in relation to the issues involved; - involved internal tax professionals to assess management’s conclusions on contingent tax matters; - checked the mathematical accuracy of the calculations underlying the provisions; and - assessed the adequacy of the related disclosures made in the consolidated financial statements with respect to the applicable accounting and reporting standards.

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Information Other than the Financial Statements and Consolidated Financial Statements and Auditor’s Reports Thereon

Management is responsible for the other information. The other information comprises the information included in the annual report but does not include the financial statements and consolidated financial statements and our auditor’s reports thereon.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Board of Directors for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the accounting and reporting standards as applicable in Pakistan and Companies Act, 2017 and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is responsible for overseeing the Group’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs as applicable in Pakistan will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

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As part of an audit in accordance with ISAs as applicable in Pakistan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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We also provide the Board of Directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the Board of Directors, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor’s report is Azhar Hussain.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.

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A. F. Ferguson & Co. Chartered Accountants Karachi

Date: March 4, 2026

UDIN: AR202510290KrQpkSmhb

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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consolidated statement of financial position as at december 31, 2025

ASSETS Non-current assets Property, plant and equipment 4 Intangible assets 5 Long-term investments 6 Deferred taxation 19 Long-term loans, advances and deposits 7 Current assets Stores, spares and loose tools 8 Stock-in-trade 9 Trade debts 10 Other receivables 11 Loans, advances, deposits and prepayments 12 Taxation - net Accrued income Short-term investments 13 Cash and bank balances 14 TOTAL ASSETS Note (Amounts in thousand)	2025.......Rupees.......2024	2025.......Rupees.......2024
	92,391,260 4,779,969 4,348,915 1,534,786 26,738	83,137,431 5,007,551 4,268,249 - 197,921
	103,081,668	92,611,152
	9,151,070 25,691,512 16,845,896 7,834,671 3,669,419 8,689,083 147,159 16,012,850 8,042,747	8,239,527 26,729,059 8,253,231 11,995,667 4,594,998 9,907,395 272,080 3,690,852 4,308,149
	96,084,407	77,990,958
	199,166,075	170,602,110

Note (Amounts in thousand) EQUITY & LIABILITIES Equity Share capital 15 Reserves Share premium 16 Remeasurement of post employment benefits 16 Unappropriated profit 16 TOTAL EQUITY Liabilities Non-current liabilities Borrowings 17 Government grant 18 Deferred taxation 19 Deferred liabilities 20 Current liabilities Trade and other payables 21 Accrued interest / mark-up Current portion of: - borrowings 17 - government grant 18 - deferred liabilities 20 Provision for Gas Infrastructure Development Cess (GIDC) 22 Short-term borrowings 23 Unclaimed dividend TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES CONTINGENCIES AND COMMITMENTS 24	2025.......Rupees.......2024 13,352,993 13,352,993	2025.......Rupees.......2024 13,352,993 13,352,993
	3,384,904 (38,205) 28,047,546	3,384,904 (69,543) 30,790,190
	31,394,245	34,105,551
	44,747,238	47,458,544
	29,445,959 342,634 - 34,464	18,701,703 514,355 672,844 247,520
	29,823,057	20,136,422
	65,699,202 1,434,310 14,461,586 171,721 102,437 19,558,031 23,022,723 145,770	66,606,267 1,209,388 2,834,018 202,737 62,546 19,558,031 12,451,850 82,307
	124,595,780	103,007,144
	154,418,837	123,143,566
	199,166,075	170,602,110

The annexed notes from 1 to 52 form an integral part of these consolidated financial statements.

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Ahsan Zafar Syed Chief Executive Officer Chairman

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consolidated statement of profit or loss

for the year ended december 31, 2025

Net sales 25 Cost of sales 26 Gross profit Selling and distribution expenses 27 Administrative expenses 28 Other income 29 Other operating expenses 30 Finance cost 31 Gain on subsidy receivable from GoP 32 Profit before taxation Taxation 33 Profit for the year Earnings per share - basic and diluted 34 Note (Amounts in thousand except for earnings per share)	237,130,786 256,675,163 (164,577,790) (184,751,315) 72,552,996 71,923,848 (20,213,109) (17,960,843) (4,723,142) (4,293,398) 47,616,745 49,669,607 2,550,195 2,925,210 (4,589,867) (4,513,406) (6,170,739) (4,128,579) 624,715 1,203,088 40,031,049 45,155,920 (17,403,005) (16,895,682) 22,628,044 28,260,238 16.95 21.16 2025.......Rupees.......2024

(Amounts in thousand except for earnings per share)

consolidated statement of comprehensive income

for the year ended december 31, 2025

consolidated statement of comprehensive income for the year ended december 31, 2025
Profit for the year Other comprehensive income: Items that will not be reclassified subsequently to profit or loss - Remeasurement of post employment benefits obligations 38.2.7 - Tax relating to remeasurement of post employment benefits obligations Total comprehensive income for the year Note (Amounts in thousand)	22,628,044 28,260,238 51,373 7,356 (20,035) (2,869) 31,338 4,487 22,659,382 28,264,725 2025.......Rupees.......2024
	22,659,382	28,264,725

The annexed notes from 1 to 52 form an integral part of these consolidated financial statements.

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Muh ammad Imran K halil Ali Rathore
Chief Financial Officer Chief Executive Officer
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Ahsan Zafar Syed
Chairman
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Muh ammad Imran K halil
Chief Financial Officer
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consolidated statement of changes in equity

for the year ended december 31, 2025

(Amounts in thousand)

Balance as at January 1, 2025 Transactions with owners: Dividends: - Final 2024: Rs. 8.00 per share - 1st interim 2025: Rs. 2.25 per share - 2nd interim 2025: Rs. 4.25 per share - 3rd interim 2025: Rs. 4.5 per share Total comprehensive income for the year ended December 31, 2025 Profit for the year Other comprehensive income Balance as at December 31, 2025 Balance as at January 1, 2024 Transactions with owners Dividends: - Final 2023: Rs. 8 per share - 1st interim 2024: Rs. 8 per share - 2nd interim 2024: Rs. 3 per share - 3rd interim 2024: Rs. 2.5 per share Total comprehensive income for the year ended ended December 31, 2024 Profit for the year Other comprehensive income Balance as at December 31, 2024 (Amounts in thousand)	.................................................................Rupees................................................................. Remeasurement of post empolyment benefits Total Share capital Share premium Unappropriated profit CAPITAL REVENUE RESERVES
	13,352,993 3,384,904 (69,543) 30,790,190 47,458,544
	- - - (10,682,395) (10,682,395) - - - (3,004,424) (3,004,424) - - - (5,675,022) (5,675,022) - - - (6,008,847) (6,008,847)
	- - - (25,370,688) (25,370,688)
	- - - 22,628,044 22,628,044 - - 31,338 - 31,338
	- - 31,338 22,628,044 22,659,382
	13,352,993 3,384,904 (38,205) 28,047,546 44,747,238

	13,352,993 3,384,904 (74,030) 31,238,888 47,902,755
	- - - (10,682,395) (10,682,395) - - - (10,682,395) (10,682,395) - - - (4,005,898) (4,005,898) - - - (3,338,248) (3,338,248)
	- - - (28,708,936) (28,708,936)
	- - - 28,260,238 28,260,238 - - 4,487 - 4,487
	- - 4,487 28,260,238 28,264,725
	13,352,993 3,384,904 (69,543) 30,790,190 47,458,544

consolidated statement of cash flows

for the year ended december 31, 2025

Cash flows from operating activities Cash generated from operations 39 Retirement and other service benefits paid Taxes paid Long-term loans, advances and deposits Income on deposits / other financial assets received Net cash generated from / (utlilised in) operating activities Cash flows from investing activities Purchases of property, plant and equipment and intangibles Proceeds from disposal of operating assets Purchase of short-term and long-term investments Proceeds from sale of short-term and long investments Disbursement of loan to Parent Company Repayment received against loan to Parent Company Net cash (utilised in) / generated from investing activities Cash flows from financing activities Proceeds from long-term borrowings 17.5 Proceeds from short-term borrowings Repayment of short-term borrowings Loan repaid to the Parent Company Repayments of long-term borrowings 17.5 Loan obtained from the Parent Company Finance cost paid Dividends paid Net cash generated from / (utilised in) financing activities Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year 40 Note (Amounts in thousand)	2025.......Rupees.......2024	2025.......Rupees.......2024

	45,722,182 (545,358) (18,412,358) 171,183 926,353	31,581,760 (354,035) (37,529,156) 11,885 2,342,586
	27,862,002	(3,946,960)
	(14,444,067) 1,658,539 (35,722,328) 23,319,664 (2,690,000) 2,690,000	(9,227,357) 1,581,789 (88,945,624) 106,001,485 - -
	(25,188,192)	9,410,293
	24,000,000 20,500,000 (5,000,000) (33,113,000) (1,830,913) 33,113,000 (6,371,947) (25,307,225)	18,000,000 4,500,000 - (11,500,000) (2,686,717) 11,500,000 (3,018,963) (28,674,928)
	5,989,915	(11,880,608)
	8,663,725 (2,443,701)	(6,417,275) 3,973,574
	6,220,024	(2,443,701)

The annexed notes from 1 to 52 form an integral part of these consolidated financial statements.

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Muh ammad Imran K halil Ali Rathore Chief Financial Officer Chief Executive Officer

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Ahsan Zafar Syed Chairman

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Chief Executive Officer

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Ahsan Zafar Syed Chairman

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annual report 2025

notes to the consolidated financial statements for the year ended december 31, 2025

(Amounts in thousand)

legal status and operations

Engro Fertilizers Limited (the Holding Company) is a public company incorporated in Pakistan on June 29, 2009 under the repealed Companies Ordinance, 1984 (now Companies Act 2017) as a wholly owned subsidiary of Engro Corporation Limited (the Parent Company), which is a wholly owned subsidiary of Engro Holding Limited (the Ultimate Parent Company). The Holding Company is listed on Pakistan Stock Exchange Limited (PSX). As at December 31, 2025, the Parent Company holds 56.27% share capital of the Holding Company.

The Holding Company is engaged in the manufacturing, purchasing and marketing of fertilizers. The business units of the Holding Company include the following:

Geographical Location

Business Unit

Head / Registered Office 6th floor, The Harbour Front Building, Plot Number HC-3, Block 4, Scheme Number 5, Clifton, Karachi.

Engro Daharki Plant

District Ghotki, Sindh.

Engro Zarkhez Plant EZ / 1 / P – 1 – II Eastern Zone, Port Qasim, Karachi. Engro Markaz Bahawalpur Chowk Bloachan, Opposite 5 Star Petrol Pump, KLP Road. Engro Markaz Muridke Sheikupura-Muridke Road, Near Maryam Rice Mill. Engro Markaz Sahiwal Opposite Sohni Dharti Seeds Plant 134 / 9 - L, Multan Bypass. Engro Markaz Sargodha 85 Jhall Sillanwali Road, Near Sapphire Marriage Hall.

1.1 The 'Group' consists of:

Holding Company: Engro Fertilizers Limited.

Subsidiary Company: EFERT Agritrade (Private) Limited (EAPL), which is a wholly owned subsidiary of the Holding Company.

1.1.1 EFERT Agritrade (Private) Limited

EFERT Agritrade (Private) Limited (EAPL) was incorporated on July 6, 2017 under repealed Companies Ordinance, 1984 (now Companies Act, 2017), as a wholly owned subsidiary of the Holding Company to carry out business of trading and distribution of imported fertilizer. As part of the business reorganisation in 2017, the Holding Company transferred its business of trading and distribution of imported fertilizer to the new subsidiary and holds 10,000 ordinary shares of Rs. 10 each in EAPL. The registered office of the Subsidiary Company is 6th floor, The Harbour Front Building, Plot Number HC-3, Block 4, Scheme Number 5, Clifton, Karachi.

(Amounts in thousand)

2.1 Basis of preparation
2.1.1 These consolidated financial statements have been prepared under the historical cost convention, except for re-measurement of certain financial assets at fair value and recognition of certain staff retirement benefits at present value.

2.1.2 Statement of compliance

These consolidated financial statements have been prepared in accordance with the accounting and reporting standards as applicable in Pakistan. The accounting and reporting standards applicable on the Group comprise of:

IFRS Accounting Standards issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017 (the Act); and
Provisions of, directives and notifications issued under the Act.

Where the provisions of, directives and notifications issued under the Act differ from the requirements of IFRS Accounting Standards, the provisions of, directives and notifications issued under the Act have been followed.

2.1.3 The preparation of consolidated financial statements in conformity with the above requirements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in note 3.
2.1.4 Initial application of a standard, amendment or an interpretation to existing standards
a) Standards, amendments to published standards and interpretations that are effective for the year and are relevant to the Group

There are certain amendments and improvements to approved accounting and reporting standards became applicable to the Group for the financial year beginning on January 1, 2025, however these do not have any material impact on the Group's financial reporting and, therefore, have not been presented in these consolidated financial statements.

b) Standards or amendments to approved accounting and reporting standards that are not yet effective and have not been early adopted by the Group

The following standards or amendments are not effective for the accounting periods beginning on or after January 1, 2025 and have not been early adopted by the Group:

i) Amendment to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments (effective from January 1, 2026)

These amendments:

2. material accounting policy information

The material accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

clarify the requirements for the timing of recognition and derecognition of some financial assets and liabilities, with a new exception for some financial liabilities settled through an electronic cash transfer system;
clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion;

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(Amounts in thousand)

add new disclosures for certain instruments with contractual terms that can change cash flows (such as some instruments with features linked to the achievement of environment, social and governance (ESG) targets); and
make updates to the disclosures for equity instruments designated at Fair Value through Other Comprehensive Income (FVOCI)

An important clarification brought about in these amendments is that a payment instruction (e.g. a cheque) that is prepared for a future payment will generally not meet the requirements for the financial liability to be discharged and hence derecognised. The previous practice of financial liabilities being derecognised upon issuance of cheques would need to be reconsidered.

ii) IFRS 18 - Presentation and Disclosure in Financial Statements (effective from January 1, 2027)

This is the new standard on presentation and disclosure in financial statements, with a focus on updates to the statement of profit or loss. The key new concepts introduced in IFRS 18 relate to:

the structure of the statement of profit or loss;
required disclosures in the financial statements for certain profit or loss performance measures that are reported outside an entity’s financial statements (that is, management-defined performance measures); and
enhanced principles on aggregation and disaggregation which apply to the primary financial statements and notes in general.

The Group's management at present is in the process of assessing the full impacts of these new standard and the amendments to IFRS 7 annd IFRS 9, and is expecting to complete the assessment in due course.

Other than above there is a standard and certain amendments to accounting standards that are not yet effective and have not been early adopted by the Group for the financial year beginning on January 1, 2025. The standard and amendments are not expected to have any material impact in the Group's financial reporting and, therefore, have not been presented in these consolidated financial statements.

2.1.5 Basis of consolidation

i) Subsidiaries

Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Further, the Group also considers whether:

it has power to direct the relevant activities of the subsidiaries;
it is exposed to variable returns from the subsidiaries; and
decision making power allows the Group to affect its variable returns from the subsidiaries.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are derecognised from the date the control ceases.

(Amounts in thousand)

The Group uses the acquisition method of accounting to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities (including contingent liabilities) assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assets.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer's previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognised in the consolidated statement of profit or loss.

Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised in the consolidated statement of profit or loss.

Inter-company transactions, balances, income and expenses on transactions between group companies are eliminated. Profits and losses (unrealised) are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

ii) Transactions and non-controlling interest s

The Group treats transactions with non-controlling interests that do not result in loss of control as transactions with equity owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.

iii) Disposal of subsidiaries

When the Group ceases to have control or significant influence, any retained interest in the entity is remeasured to its fair value, with the change in carrying amount recognised in the consolidated statement of profit or loss. The fair value is the initial carrying amount for the purposes of subsequent accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed off the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

2.2 Property, plant and equipment

These are stated at historical cost less accumulated depreciation and impairment losses, if any, except for freehold land and capital work in progress which are stated at cost less impairment losses, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items including borrowing costs. The cost of self constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

Where major components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.

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Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the consolidated statement of profit or loss during the financial year in which they are incurred.

Disposal of asset is recognised when significant risk and rewards incidental to ownership have been transferred to buyers. Gains and losses on disposals are determined by comparing the sale proceeds with the carrying amount and are recognised within ‘Other operating expenses / income’ in the consolidated statement of profit or loss in the financial year of disposal.

Depreciation is charged to the consolidated statement of profit or loss using the straight line method, except for catalyst whose depreciation is charged on the basis of number of production days, whereby the cost of an operating asset less its estimated residual value, if significant, is depreciated over its estimated useful life. Depreciation on additions is charged from the month following the month in which the asset is available for use and on disposals up to the preceding month of disposal.

Depreciation method, useful lives and residual values are reviewed and adjusted, if appropriate, at each reporting date.

d) Right to use the brand

These are stated at cost less accumulated impairment, if any.

The carrying values of intangible assets are reviewed for impairment when events or changes in circumstances indicate that the carrying values may not be recoverable. If any such indication exists, assets or cash generating units are tested for impairment. Also, goodwill is tested for impairment atleast once a year and other intangibles with indefinite useful life are tested for impairment at each reporting date. Where the carrying value exceeds the estimated recoverable amount, these are written down to their recoverable amount and the resulting impairment is charged to the consolidated statement of profit or loss.

Impairment is reversed only if there have been changes in estimates used to determine recoverable amounts and only to the extent that the revised recoverable amount does not exceed the carrying values that would have existed, had there been no recognition of impairment, except impairment of goodwill which is not reversed.

The useful lives of intangible assets are reviewed at each reporting date to determine whether events and circumstances continue to support an indefinite useful life assessment for the asset.

2.4 Impairment of non-financial assets

2.3 Intangible assets

a) Computer software and licenses

Costs associated with maintaining computer software programmes are recognised as an expense when incurred. However, costs that are directly attributable to identifiable software and have probable economic benefits beyond one year, are recognised as an intangible asset. Direct costs include the purchase cost of software (license fee) and related overhead costs.

Following initial recognition, computer software and licenses are carried at cost less accumulated amortisation and impairment losses, if any.

Expenditure which enhances or extends the performance of computer software beyond its original specification and useful life is recognised as a capital improvement and added to the original cost of the software.

Computer software and license cost treated as intangible assets are amortised from the date the software is put to use on a straight-line basis over a period of 4 years, except for the Group's investment in its ERP i.e. OneSAP which is amortised over a period of 8 years.

b) Rights for future gas utilization

Rights for future gas utilisation represent premium paid to the Goverment of Pakistan (GoP) for allocation of 100 MMSCFD natural gas for a period of 20 years for the Holding Company's Enven plant. The rights are being amortised from the date of commercial production on a straight-line basis over the remaining allocation period.

The carrying amounts of non-financial assets are assessed at each reporting date to ascertain whether there is any indication of impairment. If such an indication exists, the asset’s recoverable amount is estimated to determine the extent of impairment loss, if any. An impairment loss is recognised as an expense in the consolidated statement of profit or loss.

The recoverable amount is the higher of an asset’s fair value less cost of disposal and value-in-use. Value-in-use is ascertained through discounting of the estimated future cash flows using a discount rate that reflects current market assessments of the time value of money and the risks specific to the assets. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (i.e. cash generating units).

An impairment loss is reversed if there is a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

2.5 Joint arrangements

Joint arrangements are arrangements in which the Group has contractually agreed sharing of control, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control.

Joint arrangements are classified as joint operations or joint ventures depending upon the rights and obligations arising from the joint arrangement. The Group classifies a joint arrangement as joint operation when the Group has the rights to the assets, and obligations for the liabilities, relating to the arrangement. The Group classifies a joint arrangement as a joint venture when the Group has the rights to the net assets of the arrangement.

c) Goodwill

Goodwill represents the difference between the consideration paid for acquiring interests in a business and the fair value of the Holding Company's share of its net assets at the date of acquisition and is carried at cost less accumulated impairment, if any.

In respect of an interest in a joint operation, the Group recognises its assets, including its share of any assets held jointly; its liabilities, including its share of any liabilities incurred jointly; its revenue from the sale of its share of the output arising from the joint operation; its share of the revenue from the sale of the output by the joint operation; its expenses, including its share of any expenses incurred jointly.

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2.6 Financial assets

2.6.1 Classification, initial recognition and measurement

Financial assets are classified into appropriate categories on initial recognition and are subsequently measured at amortised cost, at fair value through other comprehensive income or at fair value through profit or loss. The management determines the classification of financial assets into appropriate categories based on the Group’s business model for managing the financial assets and the contractual terms of the cash flows.

A financial asset is measured at amortised cost if both of the following conditions are met:

a) the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
b) the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met:

a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
b) the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through profit or loss if it is not measured at amortised cost or at fair value through other comprehensive income.

All financial assets are recognised at the time when the Group becomes a party to the contractual provisions of the instrument. Regular way purchases and sales of financial assets are recognised on trade date; the date on which the Group commits to purchase or sell the financial asset. Financial assets at amortised cost are initially recognised at fair value and are subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by impairment losses, if any. Interest income and impairment losses are recognised in profit or loss. Financial assets carried at fair value through other comprehensive income are initially and subsequently measured at fair value, with gains and losses arising from changes in fair value recognised in other comprehensive income. Financial assets carried at fair value through profit or loss are initially recorded at fair value and transaction costs are expensed in profit or loss. Realised and unrealised gains and losses arising from changes in the fair values of the financial assets held at fair value through profit or loss are included in profit or loss in the period in which they arise.

(Amounts in thousand)

2.6.3 Impairment of financial assets

The Group assesses on a forward looking basis the Expected Credit Losses (ECL) associated with its debt instruments carried at amortised cost and at fair value through other comprehensive income. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade and other receivables, the Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

The Group measures ECL of a financial instrument in a way that reflects:

a) an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;
b) the time value of money; and
c) reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions.

The measurement of ECL is a function of the probability of default, loss given default (i.e. the magnitude of the loss if there is a default) and the exposure at default. The assessment of the probability of default and loss given default is based on historical data adjusted by forward-looking information as described above. As for the exposure at default for financial assets, this is represented by the assets’ gross carrying amount at the reporting date.

A default on a financial asset is considered when the counterparty fails to make contractual payments within 90 days of when they fall due.

Financial assets are written off when there are no reasonable expectation of recovery. Where loans or receivables have been written off, the Group continues to engage in enforcement activity to attempt to recover the balance due. Where recoveries are made, these are recognised in profit or loss.

2.7 Financial liabilities

The Group recognises a financial liability in its consolidated statement of financial position when, and only when, it becomes party to the contractual provisions of the instrument. At initial recognition, the Group measures a financial liability at its fair value minus, in the case of a financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial liability. Subsequently, financial liabilities are stated at amortised cost.

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expired. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in respective carrying amounts is recognised in profit or loss.

2.6.2 Derecognition

2.8 Offsetting financial instruments

Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been transferred and the Group has transferred substantially all the risk and rewards of ownership. On derecognition of a financial asset, in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognised in profit or loss and other comprehensive income (as the case may be).

Financial assets and liabilities are offset and the net amount is reported in the consolidated statement of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle either on a net basis, or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Group or the counterparty.

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2.9 Stores, spares and loose tools

These are valued at weighted average cost except for items in transit which are stated at invoice value plus other charges incurred thereon till the reporting date. For items which are slow moving and / or identified as surplus to the Group's requirements, adequate provision is made for any excess book value over estimated realisable value. The Group reviews the carrying amount of stores, spares and losse tools on a regular basis and provision is made for obsolescence.

Spare parts of capital nature which can be used only in connection with an item of property, plant and equipment are shown separately as major spare parts and stand-by equipment under property, plant and equipment.

2.10 Stock-in-trade

These are valued at the lower of cost and net realisable value. Cost is determined using weighted average method except for raw materials in transit which are stated at cost (invoice value) plus other charges incurred thereon till the reporting date. Cost in relation to finished goods includes applicable purchase cost and manufacturing expenses. The cost of work in process includes material and proportionate conversion costs.

Net realisable value signifies the estimated selling price in the ordinary course of business less estimated costs of completion and costs necessary to be incurred in order to make the sales.

2.11 Trade debts and other receivables

These are recognised initially at fair value plus directly attributable transaction costs, if any and subsequently measured at amortised cost using effective interest rate method less provision for impairment, if any as per note 2.6.3. The amount of provision is charged to the consolidated statement of profit or loss.

2.15 Borrowing cost

Borrowing costs are recognised as an expense in the period in which they are incurred except where such costs are directly attributable to the acquisition, construction or production of a qualifying asset in which case such costs are capitalised as part of the cost of that asset.

2.16 Trade and other payables

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method.

These are classified as current liabilities if payment is due within 12 months or less (or in the normal operating cycle of the business, if longer). If not, they are presented as non-current liabilities.

2.17 Income tax

The tax expense for the year comprises current and deferred tax. Tax expense is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity, in which case, the tax expense is also recognised in other comprehensive income or directly in equity, respectively.

Current

Current income tax charge is based on the taxable income for the year calculated on the basis of tax laws enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred

Trade debts and other receivables considered irrecoverable are written-off.

2.12 Cash and cash equivalents

Cash and cash equivalents in the consolidated statement of cash flows include cash in hand, balances with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts / short term borrowings which are payable on demand. Bank overdrafts are shown within short term borrowings on current liabilities in the consolidated statement of financial position.

2.13 Share capital

Ordinary shares are classified as equity and recognised at their face value. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

2.14 Borrowings

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the consolidated statement of profit or loss over the period of the borrowings using the effective interest rate method.

Deferred tax is recognised using the balance sheet method, providing for all temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to apply to the temporary differences when they reverse, based on the tax laws that have been enacted or substantively enacted at the reporting date.

A deferred tax asset is recognised to the extent that is probable that future taxable profits will be available against which temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

2.18 Employee benefits

2.18.1 Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contribution into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in the consolidated statement of profit or loss when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

The Group contributes to:

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

defined contribution provident fund for its permanent employees. Monthly contributions are made both by the Group and employees to the fund at the rate of 10% of basic salary;

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defined contribution pension fund for the benefit of those management employees who have not opted for defined contribution gratuity fund as explained in note 2.18.3. Monthly contributions are made by the Group to the fund at rates ranging from 12.5% to 13.75% of basic salary; and
defined contribution gratuity fund for the benefit of those management employees who have selected to opt out of defined benefit gratuity fund and defined contribution pension plans as more fully explained in note 2.18.3. Monthly contributions are made by the Group to the fund at the rate of 8.33% of basic salary.

All of the aforementioned funds are managed by the Parent Company.

2.18.2 Defined benefit plans

A defined benefit plan is a post-employment benefit plan other than the defined contribution plan. The Group's net obligation in respect of defined benefit plans is calculated by estimating the amount of future benefit that employees have earned in return for their service in current and prior periods; that benefit is discounted to determine its present value. The calculation is performed annually by a qualified actuary using the Projected Unit Credit Method, related details of which are given in note 38 to the consolidated financial statements.

Remeasurements (actuarial gains / losses) in respect of defined benefit plans are recognised directly in equity through other comprehensive income.

Contributions require assumptions to be made of future outcomes which mainly include increase in remuneration, expected long-term return on plan assets and the discount rate used to convert future cash flows to current values. Calculations are sensitive to changes in the underlying assumptions.

The Group also contributes to:

defined benefit funded pension scheme for its management employees; and
defined benefit funded gratuity schemes for its management and non-management employees.

The pension scheme provides life time pension to retired employees or their spouses. Contributions are made annually to these funds on the basis of actuarial recommendations. The pension scheme has been curtailed and effective from July 1, 2005, no new members are inducted in this scheme.

2.19 Provisions and contingent liabilities

Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of an event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made. Provisions are not recognised for future operating losses and are reviewed at each reporting date and adjusted to reflect the current best estimate.

Contingent liabilities are disclosed when the Group has possible obligation that arises from past event's and whose existence will be confirmed only by occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity, or a present obligation that arises from past event but is not recognised because it is not probable that an outflow of resources embodying economic benefit will be required to settle the obligation or, when amount of obligation cannot be measured with sufficient reliability.

2.20 Foreign currency transactions and translation

These consolidated financial statements are presented in Pakistan Rupees, which is the Group’s functional and presentation currency. Amounts presented in these consolidated financial statements have been rounded off to the nearest thousand, unless otherwise stated. Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are recognised in the consolidated statement of profit or loss.

2.21 Revenue recognition

The Group manufactures and sells urea and other fertilizers products in the market. Revenue from sale of goods is recognised when control of the products is transferred i.e. when the product is dispatched / delivered to the customer. The payment terms in contracts with customers for sale of goods range from 30 to 180 days from invoice date.

Revenue is measured at fair value of the consideration received or receivable (which is generally equal to invoice amount), excluding discounts, rebates and government levies.

2.22 Other income

Income on deposits and other financial assets is recognised on accrual basis.

2.18.3 In June 2011, the Group gave a one time irrevocable option to selected members of MPT Employees' Defined Benefit Gratuity Fund and Defined Contribution Pension Fund to join a new MPT Employees' Defined Contribution Gratuity Fund (the Fund), a defined contribution plan. The present value, as at June 30, 2011, of the defined benefit obligation of those employees, who accepted this offer, were transferred to this Fund. Furthermore, from July 2011 onwards, the monthly contributions to Defined Contribution Pension Fund of such employees were discontinued.

2.18.4 Service incentive plan

The Group recognises provision under a service incentive plan for certain category of experienced employees to continue in the Group’s employment.

2.18.5 Employees' compensated absences

The Group accounts for compensated absences on the basis of unavailed leave balance of each employee at the end of the year.

Dividend income on equity investments is recognised when the Group's right to receive the dividend is established.

2.23 Earnings per share

The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Holding Company by the weighted average number of ordinary shares outstanding during the year. Diluted EPS is determined by adjusting the profit or loss attributable to the ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.

Segment reporting

2.24

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors of the Holding Company that makes strategic decisions.

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2.25 Dividend and appropriation to reserves

Dividend and appropriation to reserves are recognised in the consolidated financial statements in the period in which these are approved.

2.26 Contract liability

Contract liability is an obligation of the Group to transfer goods and services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. If the customer pays consideration before the Group transfers goods or services to the customer, a contract liability is recognised when payment is received. Contract liabilities are recognised as revenue when Group fulfils the performance obligation under the contract.

3. critical accounting estimates and judgements

Estimates and judements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. Estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:

3.1 Property, plant and equipment

The Group reviews appropriateness of the rates of depreciation, useful lives and residual values used in the calculation of depreciation. Further, where applicable, an estimate of recoverable amount of assets is made for possible impairment on an annual basis (note 4).

3.2 Income taxes

In making the estimates for income taxes, the management considers the applicable laws and the decisions / judgments of appellate authorities on certain issues in the past. Where the final tax outcome is different from the amounts that were initially recorded, such differences will impact the income tax provision in the period in which such final outcome is determined. Accordingly, the recognition of current and deferred taxes is made taking into account these judgments and the best estimates of future results of operations of the Group (note 33).

3.5 Contingencies and provisions

Significant estimates and judgements are being used by the management in relation to the interpretation of laws, statutory rules, regulations and the probability of outcome and financial impact, if any, in accounting for contingencies and provisions pertaining to legal and taxation matters being contested at various forums based on applicable laws and the decisions / judgements (note 24).

3.6 Impairment of financial assets

Significant estimates are involved in the assessment of the ECL on the Group's financial assets except for cash and bank balances, long-term investments and short-term investments, as the determination of ECL requires evaluating correlation between historical observed default rates and the projection of cashflows, forecast economic conditions and ECL. The amount of ECL is sensitive to changes in circumstances and of forecast economic conditions. In respect of ECL on subsidy receivable, since the Group is confident of full recovery therefore, only time value of money was considered for the determination of loss allowance as at the reporting date (note 11.3.1).

3.7 Stock-in-trade

Determining the value of specific category of stock-in-trade i.e. Bulk Urea and Bulk Di-Ammonium Phosphate (DAP), involves the use of significant estimates and assumptions. As the weighing of these inventory items is not practicable, the reasonableness of the quantities on hand is assessed by obtaining measurements of stockpiles and converting these measurements into unit of volume by bulk density values (note 9).

4. property, plant and equipment

property, plant and equipment Operating assets at net book value (note 4.1) Capital work in progress (CWIP) (note 4.5) Major spare parts and stand-by equipment (note 4.1.1)	2025.......Rupees.......2024	2025.......Rupees.......2024
	74,507,920 12,835,129 5,048,211	73,994,621 7,151,645 1,991,165
	92,391,260	83,137,431

3.3 Provision for retirement and other service benefits obligations

The present value of these obligations depends on a number of factors that are determined on actuarial basis using various assumptions. Any changes in these assumptions will impact the carrying amount of these obligations. The present value of these obligations and the underlying assumptions are disclosed in note 38.

3.4 Impairment of goodwill and right to use the brand

Determining the recoverable amount of goodwill and right to use the brand involves use of significant estimates and assumptions. In making the aforementioned fair valuation estimates, discounted cash flow approach is used. The underlying assumptions used for such valuation are disclosed in note 5.1.

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(Amounts in thousand)

4.1 Operating assets

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Land Building on
Freehold Leasasehold Freehold Leasehold Plant and Gas Catalyst Office Aircraft Vehicles Total
land land machinery pepeline equipment
Rupees
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194,914 - -	97,284 (46,400) -	3,414,532 (1,705,874) -	449,431 (212,039) -	113,854,746 (53,897,399) -	2,664,996 (1,284,311) -	3,271,405 (2,295,107) -	1,703,170 (1,189,740) -	3,854,412 (397,152) -	3,997,441 (1,524,415) (1,525,396)	133,502,331 (62,552,437) (1,525,396)
194,914	50,884	1,708,658	237,392	59,957,347	1,380,685	976,298	513,430	3,457,260	947,630	69,424,498
194,914 -	50,884 -	1,708,658 754,868	237,392 -	59,957,347 6,988,663	1,380,685 -	976,298 652,719	513,430 251,528	3,457,260 -	947,630 387,942	69,424,498 9,035,720

-	-	(11,055)	(5,354)	-	-	-	(38,512)	-	(287,327)	(342,248)
-	-	10,545	2,909	-	-	-	36,187	-	175,204	224,845
- - -	- (1,674) -	(510) (194,882) -	(2,445) (10,828) -	- (2,886,670) -	- (63,423) -	- (367,638) -	(2,325) (220,267) (6,339)	- (235,072) -	(112,123) (238,044) (123,357)	(117,403) (4,218,498) (129,696)
194,914	49,210	2,268,134	224,119	64,059,340	1,317,262	1,261,379	536,027	3,222,188	862,048	73,994,621
194,914 -	97,284 (48,074)	4,158,345 (1,890,211)	444,077 (219,958)	120,843,409 (56,784,069)	2,664,996 (1,347,734)	3,924,124 (2,662,745)	1,903,931 (1,367,904)	3,854,412 (632,224)	1,662,243 (800,195)	139,747,735 (65,753,114)
194,914	49,210	2,268,134	224,119	64,059,340	1,317,262	1,261,379	536,027	3,222,188	862,048	73,994,621

194,914 -	49,210 -	2,268,134 536,383	224,119 -	64,059,340 3,479,731	1,317,262 -	1,261,379 1,105,353	536,027 511,924	3,222,188 -	862,048 476,240	73,994,621 6,109,631
- -	- -	- -	- -	- -	- -	- -	(34,155) 30,500	(624,227) 159,400	(294,418) 173,962	(952,800) 363,862
- -	- (1,674)	- (479,139)	- (10,788)	- (3,255,780)	- (63,423)	- (444,132)	(3,655) (299,303)	(464,827) (211,887)	(120,456) (241,268)	(588,938) (5,007,394)
194,914	47,536	2,325,378	213,331	64,283,291	1,253,839	1,922,600	744,993	2,545,474	976,564	74,507,920
194,914 -	97,284 (49,748)	4,694,728 (2,369,350)	444,077 (230,746)	124,323,140 (60,039,849)	2,664,996 (1,411,157)	5,029,477 (3,106,877)	2,381,700 (1,636,707)	3,230,185 (684,711)	1,844,065 (867,501)	144,904,566 (70,396,646)
194,914	47,536	2,325,378	213,331	64,283,291	1,253,839	1,922,600	744,993	2,545,474	976,564	74,507,920
-	2 to 5	2.5 to 10	2.5	3 to 10	2 to 6	No. of production days	10 to 25	14.3	10 to 25

4.1.1 During the year, the Company purchased major spare parts and stand-by equipment amounting to Rs. 3,656,428 (2024: Rs. 1,493,260) and transferred such assets to capital work in progress amounting to Rs. 599,382 (2024: Rs. 783,675).

Depreciation charge for the year has been allocated as follows: Cost of sales (note 26) Selling and distribution expenses (note 27) Administrative expenses (note 28)	2025.......Rupees.......2024 4,456,352 3,698,179 165,166 149,243 385,876 371,076	2025.......Rupees.......2024 4,456,352 3,698,179 165,166 149,243 385,876 371,076
	5,007,394	4,218,498

4.2 Depreciation charge for the year has been allocated as follows:

(Amounts in thousand)

4.3 The details of operating assets disposed / written off during the year are as follows:

Cost	Accumulated depreciation	21,406 16,572 4,159 5,842 6,054 642 3,152 4,285 13,833 12,167 3,423 831 831 1,303 4,074 7,614 5,963 828 1,503 1,741 4,013 4,403 1,971 634 1,657 4,216 6,280 833 510 1,862 1,999 1,676 510 509 1,837 5,785 505 5,342 3,916 3,282 Sale proceeds
17,138 20,759 4,948 6,900 6,990 2,577 3,422 4,866 12,385 9,446 4,976 5,538 5,538 2,655 4,932 8,956 6,749 5,523 3,463 1,940 4,931 4,826 2,628 2,665 1,940 5,127 6,588 5,554 3,398 3,514 3,859 3,374 3,397 3,397 2,674 6,749 3,366 6,162 4,885 6,452	6,555 9,999 1,472 1,857 1,684 2,008 1,632 896 11,146 8,502 1,551 4,707 4,707 1,655 1,397 2,030 1,339 4,695 2,208 1,222 1,676 1,231 1,932 2,129 1,252 1,816 933 4,721 2,888 1,954 2,331 1,727 2,888 2,887 2,044 2,008 2,861 2,881 969 3,945 116,335 1,571 159,400 509 86,047 363,862 224,845
225,187 5,039 624,227 2,104 96,243		167,963 3,815 1,436,729 - 50,032
952,800		1,658,539
342,248		268,189

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(Amounts in thousand)

4.4 Particulars of immovable properties i.e. land and building which are in the name of the Holding Company are as follows:

Location Daharki plant & colony Zarkhez plant land at Port Qasim 4.5 Capital work in progress Plant and machinery 5,692,630 4,920,287 Building and civil works including gas pipeline 262,889 293,426 Furniture, fixture and equipment 275,462 280,764 Advances to suppliers 6,261,105 1,373,813 Others 343,043 283,355 12,835,129 7,151,645 4.5.1 Includes Rs. 7,642,813 (2024: Rs. 2,050,423) which represents the Company’s share in respect of a joint operation related to Pressure Enhancement Facility (PEF), as disclosed in note 49 to the consolidated financial statements. 4.5.2 Balance as at January 1 7,151,645 7,734,005 Additions during the year 11,387,021 8,517,770 Borrowing cost capitalised during the year (note 4.5.3) 426,130 - Transferred to: - operating assets (note 4.1) (6,109,631) (9,035,720) - intangible assets (note 5) (20,036) (64,410) Balance as at December 31 12,835,129 7,151,645 2025.......Rupees.......2024 2025.......Rupees.......2024 Total Area (Acreage) 734 112.5	5,692,630 4,920,287 262,889 293,426 275,462 280,764 6,261,105 1,373,813 343,043 283,355 2025.......Rupees.......2024 Total Area (Acreage) 734 112.5	5,692,630 4,920,287 262,889 293,426 275,462 280,764 6,261,105 1,373,813 343,043 283,355 2025.......Rupees.......2024 Total Area (Acreage) 734 112.5
	12,835,129	7,151,645
	12,835,129	7,151,645

4.5.1 Includes Rs. 7,642,813 (2024: Rs. 2,050,423) which represents the Company’s share in respect of a joint operation related to Pressure Enhancement Facility (PEF), as disclosed in note 49 to the consolidated financial statements.
4.5.3 The borrowing costs have been capitalised during the year at a capitalisation rate of 12.43%.

(Amounts in thousand)

5. intangible assets

Goodwill (note 5.1) Right to use the brand	Goodwill (note 5.1) Right to use the brand	(note 5.2) Software and licenses Rupees	Rights for future gas utilisation Total

183,806 - 183,806 183,806 -	4,170,995 - 4,170,995 4,170,995 -	1,721,842 (930,780) 791,062 791,062 64,410	6,178,955 (994,763) 5,184,192 5,184,192 64,410 (762) 396 (366) (240,685) 5,007,551 6,242,603 (1,235,052) 102,312 (63,983) 38,329 38,329 - - - - (5,110) 33,219 102,312 (69,093)
- -	- -	(762) 396
- - 183,806 183,806 -	- - 4,170,995 4,170,995 -	(366) (235,575) 619,531 1,785,490 (1,165,959)
183,806	4,170,995	619,531	5,007,551 33,219

183,806 - - 183,806 183,806 -	4,170,995 - - 4,170,995 4,170,995 -	619,531 20,036 (242,508) 397,059 1,805,526 (1,408,467)	5,007,551 20,036 (247,618) 4,779,969 - 6,262,639 (1,482,670) 4,779,969 33,219 - (5,110) 28,109 102,312 (74,203) 28,109 5
183,806	4,170,995	397,059
-	-	12.5-25

5.1 Goodwill and Right to use the brand

Goodwill and right to use the brand represent amounts recognised on amalgamation of Engro Eximp (Private) Limited (EEPL) with the Holding Company, being the difference between the fair values of net assets at the time of amalgamation and the amount of consideration given.

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(Amounts in thousand)

Goodwill and right to use the brand have been allocated to the single Cash Generating Unit (CGU) (i.e Phosphate business) having an indefinite life, till the time the related CGU is disposed / derecognised. The recoverable amount of cash generating unit is the higher of value in use or fair value less costs to sell. Value in use is calculated as the net present value of the projected cash flows of the cash generating unit to which the asset belongs, discounted at risk-adjusted discount rate.

Details relating to the discounted cash flow model used to determine the value in use of goodwill and right to use the brand are as follows:

Valuation basis Value in use Key assumptions Sales growth rates Discount rate Determination of assumptions Growth rates are internal forecasts based on both internal and external market information and past performance. Cost reflects past experience, adjusted for inflation and expected changes. Discount rate is primarily based on weighted average cost of capital.

Terminal growth rate 2.5% Period of specific projected cash flows 5 years Discount rate 10.7%

The valuation indicates sufficient headroom such that a reasonably possible change to key assumptions is unlikely to result in impairment of related goodwill and right to use the brand.

5.1.1 Right to use the brand is in respect of selling Phosphate fertilizers, acquired under an agreement with the Parent Company (upon amalgamation of EEPL with the Holding Company), that has been valued at initial recognition using Relief from Royalty Method and is considered to have an indefinite life.
5.2 Primarily relates to cost incurred on implementation of new ERP i.e. OneSAP, which is being amortised over a period of 8 years.
5.3 Amortisation for the year has been allocated as follows:


Amortisation for the year has been allocated as follows: Cost of sales (note 26) Selling and distribution expenses (note 27) Administrative expenses (note 28) long-term investments At amortised cost Pakistan Investment Bonds (note 6.1)	2025.......Rupees.......2024 61,433 39,924 565 15,219 185,620 185,542
	247,618	240,685
	4,348,915	4,268,249

6. long-term investments

6.1 These bonds carry interest at the rate of 7.50% to 17.70% (2024: 13.04% to 18.27%) per annum and have maturity in two to ten years (2024: three to six years).

(Amounts in thousand)

long-term loans,advances and deposits - considered good Loans and advances to: - Executives (notes 7.1, 7.2, 7.3, 7.5 and 7.6) - Other employees (notes 7.4 and 7.6) Less: Current portion shown under current assets (note 12) Deposits to suppliers Reconciliation of the carrying amount of loans and advances to executives Balance as at January 1 Disbursements Repayments / Amortisation Balance as at December 31 Details of loans and advances to executives Service incentive loans Advances in respect of: - House rent - Salary - Others	2025.......Rupees.......2024 73,820 78,374 43,233 118,637	2025.......Rupees.......2024 73,820 78,374 43,233 118,637
	117,053 (101,587)	197,011 (10,218)
	15,466 11,272	186,793 11,128
	26,738	197,921
	78,374 140,410 (144,964)	65,076 158,245 (144,947)
	73,820	78,374
	9,751 7,112 35,438 21,519	1,034 11,493 34,910 30,937
	73,820	78,374

7. long-term loans , advances and deposits - considered good

7.1 Reconciliation of the carrying amount of loans and advances to executives
7.2 Details of loans and advances to executives
The maximum amount outstanding from executives at the end of any month during the year aggregated to Rs. 74,527 (2024: Rs. 127,739).
7.3
7.4 Includes interest free loans given to workers pursuant to Collective Labour Agreement.
7.5 Represents loans granted to employees according to the Group's policy. These loans are interest free, are repayable within 1 to 4 years and are secured to the extent of the provident fund balance and retirement benefits, if vested, of the respective employees.
7.6 The carrying values of the loans and advances are neither past due nor impaired.

8. Stores, spares and loose tools Consumable stores, spares and loose tools (note 8.2) Less: Provision for surplus and slow moving items (note 8.1) 8.1 Provision for surplus and slow moving items Balance as at January 1 Charge for the year Reversal during the year Written off during the year Balance as at December 31	2025.......Rupees.......2024 10,562,208 9,401,410 (1,411,138) (1,161,883)	2025.......Rupees.......2024 10,562,208 9,401,410 (1,411,138) (1,161,883)
	9,151,070	8,239,527
	1,161,883 304,923 (55,668) -	971,830 309,397 (118,540) (804)
	1,411,138	1,161,883

8.2 During the year, the Group has directly written off stores, spares and loose tools amounting to Rs. 3,811 (2024: Rs. 968).

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(Amounts in thousand)

9. stock-in-trade

9. stock-in-trade Raw materials (note 9.3) Packing materials Work in process Finished goods: - manufactured products - purchased and packaged products (note 9.4) Less: Provision for impairment against stock-in-trade (note 9.1) 9.1 Provision for impairment against stock-in-trade: Balance as at January 1 Charge for the year Written off during the year Balance as at December 31	4,899,226 4,731,622 475,819 935,397 269,136 44,113 2025.......Rupees.......2024	4,899,226 4,731,622 475,819 935,397 269,136 44,113 2025.......Rupees.......2024
	5,644,181	5,711,132
	5,776,028 14,414,737	6,887,648 14,360,061
	20,190,765 (143,434)	21,247,709 (229,782)
	25,691,512	26,729,059
	229,782 - (86,348)	37,341 192,441 -
	143,434	229,782

9.2 During the year, the Group has directly written off stock-in-trade amounting to Rs. 86,207 (2024: Rs. 233,993).
9.3 Includes stock-in-transit amounting to Rs. 1,201,733 (2024: Rs. 998,176).
9.4 Includes stock-in-transit amounting to Rs. 5,161,196 (2024: Rs. 9,866,371).

10. trade debts

10. trade debts Considered good - Secured (note 10.1) - Unsecured Considered doubtful (note 10.2) Less: Provision for impairment against trade debts - net (note 10.2) 10.1 These debts are secured by way of bank guarantee. 10.2 Provision for impairment against trade debts Balance as at January 1 Reversal for the year - net Balance as at December 31	15,123,596 7,443,377 1,722,300 809,854 2025.......Rupees.......2024	15,123,596 7,443,377 1,722,300 809,854 2025.......Rupees.......2024
	16,845,896 41,452	8,253,231 80,540
	16,887,348 (41,452)	8,333,771 (80,540)
	16,845,896	8,253,231
	80,540 (39,088)	111,560 (31,020)
	41,452	80,540

(Amounts in thousand)

11. other receivables Subsidy receivable from the Government of Pakistan - net (notes 11.1 and 11.2) Sales tax and FED receivable (notes 11.6 and 11.7) Due from Associated Companies: - Engro Polymer and Chemicals Limited - Engro Eximp Agriproducts (Private) Limited - Engro Elengy Terminal (Private) Limited - Sindh Engro Coal Mining Company Limited - Think PVC (Private) Limited - Engro Peroxide (Private) Limited - Elengy Terminal Pakistan Limited - Engro Energy Services Limited - Engro Enfrashare (Private) Limited - Engro Vopak Terminal Limited - Engro Technical Solutions (Private) Limited Receivable from Defined Benefit Gratuity Fund - MPT (note 38.2.1) Receivable from Workers' Profits Participation Fund (note 21.6) Claims receivable - net (note 11.4) Others (note 11.8)	2025.......Rupees.......2024 3,436,470 2,811,755 3,774,611 5,655,725 172,202 392,855 - 8,355 3,924 51,134 427 - - 12 1,000 721 9 30 - 10 2,291 2,227 4,495 12,417 509 - 29,432 22,543 260,199 - 786 62,190 148,316 2,975,693	2025.......Rupees.......2024 3,436,470 2,811,755 3,774,611 5,655,725 172,202 392,855 - 8,355 3,924 51,134 427 - - 12 1,000 721 9 30 - 10 2,291 2,227 4,495 12,417 509 - 29,432 22,543 260,199 - 786 62,190 148,316 2,975,693
	7,834,671	11,995,667

11.1 In FY 2015, the Government of Pakistan (GoP) notified payment of subsidy on sold products at the rate of Rs. 500 per 50 kg bag of Di Ammonia Phosphate (DAP) and Rs. 217 per 50 kg bag of Nitrophos (N) and NPK fertilizers (based on phosphorous content). This subsidy scheme was effective till May 27, 2016.

In FY 2016, a new subsidy scheme was announced by the GoP, effective June 25, 2016 whereby subsidy was payable on sold products at the rate of Rs. 156 per 50 kg bag of Urea and Rs. 300 per 50 kg bag of DAP and for Nitrophos 22:20 & 18:18 grade (based on phosphorus content) and NPK fertilizers (based on phosphorus content).

In FY 2017, another subsidy scheme was announced by the GoP, effective July 01, 2017. Under the new subsidy scheme, aforementioned rates were replaced with Rs. 100 per 50 kg bag for Urea only. This subsidy scheme was effective till June 30, 2018. In line with the notification issued for the said scheme, Ministry of National Food Security and Research has appointed third party auditors for verification of subsidy claims which is underway.

11.2 Subsidy receivable from the Government of Pakistan - net

Subsidy receivable from the Government of Pakistan - net Gross subsidy receivable from the GoP Less: Provision against doubtful receivable Less: Loss allowance on subsidy receivable from the GoP (note 11.3)	2025.......Rupees.......2024 6,523,493 6,523,493 (155,127) (155,127) (2,931,896) (3,556,611)	2025.......Rupees.......2024 6,523,493 6,523,493 (155,127) (155,127) (2,931,896) (3,556,611)
	3,436,470	2,811,755

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annual report 2025

(Amounts in thousand)

11.3 The movement in loss allowance on subsidy receivable from the GoP is as follows:


The movement in loss allowance on subsidy receivable from the GoP is as follows: Balance as at January 1 Gain for the year (note 32) Balance as at December 31	2025.......Rupees.......2024 3,556,611 4,759,699 (624,715) (1,203,088)
	2,931,896 3,556,611

11.3.1 As required under IFRS 9, an entity is required to assess changes in credit risk by taking into account the time value of money, reasonable and supportable assumptions regarding past events, current conditions, forecast of future events and economic conditions attached to its receivables and recognise expected credit loss, if any. Based on this, the Group has recomputed expected credit loss amounting to Rs. 2,931,896 (2024: Rs. 3,556,611) on subsidy receivable from the GoP giving due consideration to the time value of money based on expected recovery of the subsidy receivable. The Group, however, is confident of full recovery of the subsidy amount from the GoP.

2025 .......Rupees....... 2024

11.4 claims receivable - net

claims receivable - net	2025.......Rupees.......2024
Gross claims receivable Less: Provision against claims receivable	47,396 138,840 (46,610) (76,650)
	786 62,190

11.5 The maximum amount due from the Parent Company and associated companies at the end of any month during the year is as follows:

	Past Due		Total
- 174,841 - (3,701) - - - (293) 509 - - 171,356 1-90 days	16 - - (253) - - - - - - - (237) 91-180 days Past Due	223 859 - (157) 9 - - (12) - - 2,291 More than 180 days	427 172,202 - 4,495 9 - 1,000 3,924 509 - 2,291 2025
		3,213	184,857
			Total
- - 373,782 - 373 - - - - - 1-90 days	- - 24,698 2 5,458 - - - 1 7 91-180 days	- - 15,494 155 6,585 - - - 29 24 More than 180 days	- - 392,855 10 12,417 - - - 30 12 2024

(Amounts in thousand)

- Engro Peroxide (Private) Limited - Engro Plasticizer (Private) Limited - Engro Elengy Terminal (Private) Limited - Engro Infiniti (Private) Limited - Engro Foundation - Engro Eximp Agriproducts (Private) Limited - Engro Enfrashare (Private) Limited 752 6 123,729 79 2,231 8,355 2,227	(31) - (598) - - 1 - (21,912)	- - (25,692) - - 234 - 348,697	709 - 27,208 - - - 86 58,169	43 - 50,216 - - 8,120 2,141 82,807	721 - 51,134 - - 8,355 2227
					, 467,761

11.6 In 2021, after conducting a sales tax refund audit, the Deputy Commissioner Inland Revenue (DCIR) issued an order disallowing input tax claimed amounting to Rs. 386,695 in respect of 12 months period ended December 31, 2018. On appeal filed by the Subsidiary Company against the order of DCIR, Commissioner Inland Revenue – Appeals (CIR-A), in his order dated 30 March, 2023, deleted certain disallowances while certain issues were remanded back. The DCIR has filed an appeal against the order with Appellate Tribunal Inland Revenue (ATIR) which is yet to be fixed for hearing. During the year, the Subsidiary Company received an order whereby the DCIR has concluded the remand back proceedings again deciding the issues involved against the Subsidiary Company. The Subsidiary Company has filed an appeal before the ATIR which is currently pending adjudication.
11.7 Sales tax receivable is net-off provision for input tax disallowance amounting to Rs. 196,600 (2024: Rs. 196,600).
11.8 This includes Nil (2024: Rs. 2,970,119) paid to a gas supplier pursuant to an arrangement under which the Holding Company has committed to fulfill certain obligations in case of default by another gas company.

12. loans, advances, deposits and prepayments -considered good Current portion of long term loans and advances to executives and other employees (note 7) Advances and deposits Prepayments: - Insurance - Freight - Others 13. short term investments At fair value through profit or loss - Investment in units of mutual funds (notes 13.1 and 13.1.1) At amortised cost - Term Deposit Receipts (note 13.2)	101,587 10,218 2,470,147 2,989,767 511,325 528,403 532,659 377,925 53,701 688,685 2025.......Rupees.......2024	101,587 10,218 2,470,147 2,989,767 511,325 528,403 532,659 377,925 53,701 688,685 2025.......Rupees.......2024
	3,669,419	4,594,998
	14,812,850 1,200,000	2,490,852 1,200,000
	16,012,850	3,690,852

13. short term investments

13.1 This represents investment in 233,487,085 units (2024: 24,855,635 units) of Mutual Funds having cost amounting to Rs. 14,788,481 (2024: Rs. 2,441,002).
13.1.1 This includes investment in 62,013,352 units (2024: 11,057 units) of Shariah Compliant mutual funds amounting to Rs. 6,608,243 (2024: Rs. 1,011) having cost amounting to Rs. 6,600,805 (2024: Rs. 1,035).
13.2 Term Deposit Receipts have a maturity of one month (2024: one month) and carry interest at the rate of 8% (2024: 13%) per annum.

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annual report 2025

(Amounts in thousand)

14. cash and bank balances

2025 .......Rupees....... 2024

cash and bank balances	2025.......Rup	ees.......2024
Cash at banks in: - deposit accounts (notes 14.1 and 14.4) - currrent accounts and non-negotiable instruments (notes 14.2, 14.3 and 14.5) Cash in hand	183,997 7,858,550	1,543,703 2,761,333
	8,042,547 200	4,305,036 3,113
	8,042,747	4,308,149

14.1 Deposit accounts carry return at the rates ranging from 8% to 11.5% (2024: 11.50% to 13.50%) per annum.
14.2 Includes Rs. 559,907 (2024: Rs. 574,375) held in foreign currency bank accounts.
14.3 The Subsidiary Company has a T-Call account with Bank Al-Habib Limited having balance of Rs. 239 (2024: Rs. 50,112) as at December 31, 2025 and carried returns during the year ranging from 9.25% to 10% (2024: 10% to 20.5%)
14.4 Includes Shariah Compliant bank balances amounting to Nil (2024: Rs. 423,924).
14.5 Includes Shariah Compliant bank balances amounting to Rs. 177,589 (2024: Rs. 214,748).

15. share capital Authorised Capital 1,400,000,000 (2024: 1,400,000,000) Ordinary shares of Rs. 10 each Issued, subscribed and paid-up capital 258,132,299 (2024: 258,132,299) Ordinary shares of Rs. 10 each, fully paid in cash 9,999,993 (2024: 9,999,993) Ordinary shares of Rs. 10 each issued as at January 1, 2010 on transfer of fertilizer undertaking 1,062,800,000 (2024: 1,062,800,000) Ordinary shares of Rs. 10 each, issued as fully paid bonus shares 4,367,083 (2024: 4,367,083) Ordinary shares of Rs. 10 each issued upon exercise of conversion option by International Finance Corporation (IFC)	14,000,000 14,000,000 2025.......Rupees.......2024	14,000,000 14,000,000 2025.......Rupees.......2024
	2,581,323 100,000 10,628,000 43,670	2,581,323 100,000 10,628,000 43,670
	13,352,993	13,352,993

(Amounts in thousand)

15.2 These fully paid ordinary shares carry one vote per share and right to dividend.

16. reserves

reserves Capital reserves Share premium Revenue reserves Remeasurement of post employment benefits Unappropriated profit	2025.......Rupees.......2024 3,384,904 3,384,904	2025.......Rupees.......2024 3,384,904 3,384,904
	(38,205) 28,047,546 28,009,341	(69,543) 30,790,190 30,720,647
	31,394,245	34,105,551

17. borrowings - secured (non-participatory)

Note Mark - up rate per annum Long term finance utilised under: Senior Lenders Allied Bank Limited 17.3 and 17.5 3 months KIBOR + 0. Allied Bank Limited 17.3 and 17.5 3 months KIBOR + 0. Allied Bank Limited 17.3 and 17.5 3 months KIBOR + 0. Standard Chartered Bank (Pakistan) Limited 3 months KIBOR - 0.6 United Bank Limited 3 months KIBOR - 0.2 Meezan Bank Limited 3 months KIBOR + 0. Habib Bank Limited 3 months KIBOR + 0. Habib Bank Limited 17.3 and 17.5 3 months KIBOR - 0.2 MCB Bank Limited 3 months KIBOR - 0.2 Medium Term Loans Meezan Bank Limited 17.2 1 month KIBOR + 0.5 Allied Bank Limited 17.2 3 months KIBOR + 0. Askari Bank Limited 17.2 3 months KIBOR + 0. Bank Al-Falah Limited 17.2 1 month KIBOR + 0.4 Bank Islami Limited 17.2 3 months KIBOR + 0. TERF Loans Allied Bank Limited 17.4 and 17.5 1.50% Habib Bank Limited 17.4 and 17.5 2.00% MCB Bank Limited 17.4 and 17.5 1.50% Less: Fair value adjustment for loan 18 at below market rate Less: Current portion shown under current liabilities	Installments Number Commenced / Commencing from 35% 6 half yearly June 21, 2023 35% 12 quarterly March 30, 2023 35% 6 half yearly June 30, 2023 0% 4 quarterly April 03, 2026 5% 4 quarterly December 27, 2025 10% 28 quarterly March 31, 2028 10% 12 quarterly December 30, 2026 5% 6 half yearly December 30, 2025 5% 4 quarterly February 11, 2026 0% lump sum March 31, 2027 40% lump sum March 31, 2027 40% lump sum March 31, 2027 5% lump sum March 31, 2027 30% lump sum March 26, 2027 Various March 30, 2023 Various January 29, 2022 Various January 13, 2023	2025.....Rupees.....2024	2025.....Rupees.....2024

		- - - 4,000,000 3,000,000 2,000,000 5,000,000 2,250,000 5,000,000	333,333 110,325 23,675 - 3,000,000 2,000,000 5,000,000 3,000,000 5,000,000
		21,250,000	18,467,333
		3,000,000 3,000,000 5,000,000 4,000,000 5,000,000	- - - - -
		20,000,000	-
		449,220 552,270 2,170,410	539,945 641,084 2,604,451
		3,171,900 (514,355)	3,785,480 (717,092)
		2,657,545	3,068,388
		43,907,545 (14,461,586)	21,535,721 (2,834,018)
		29,445,959	18,701,703

17.1 All senior debts are secured by an equitable mortgage upon immovable property of the Holding Company and equitable charge over current and future operating assets excluding immovable property of the Holding Company.
17.2 All medium term debts are secured by joint pari passu floating charges over current assets and future stocks of the Holding Company. All the medium term loans have been repaid in full (subsequent to the year end).
17.3 During the year, the Holding Company made principal repayments of long term finances to Habib Bank Limited and Allied Bank Limited amounting to Rs. 750,000 and Rs. 467,333 respectively.
15.1 As at reporting date, the Parent Company held 56.27% (2024: 56.27%) of the share capital of the Holding Company.

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annual report 2025

(Amounts in thousand)

17.4 During the year, the Holding Company repaid TERF loan to Allied Bank Limited, Habib Bank Limited and MCB Bank Limited amounting to Rs. 90,725, Rs. 88,814 and Rs. 434,041, respectively. These borrowings have the same charge as the borrowings from other Senior Lenders on operating assets. Mark-up is chargeable at concessional rates ranging from 1.50% to 2.00% per annum and is payable in quarterly or semi-annual installment starting from January 2022.

In accordance with IFRS 9 Financial Instruments, the Holding Company has recognised these loans at their fair value and the differential markup as deferred government grant income, as mentioned in note 18 to the consolidated financial statements, which will be amortised and set off against finance cost over the period of the facilities.

17.5 Following are the changes in long-term borrowings for which cash flows have been classified as financing activities in the consolidated statement of cash flows:

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||||
|---|---|---|
|2025|.......Rupees.......|2024|
|Balance as at January 1|21,535,721|5,982,441|
|Borrowings availed during the year|24,000,000|18,000,000|
|Repayment of borrowings|(1,830,913)|(2,686,717)|
|Fair value adjustment for below market rate - net (note 18)|202,737|239,997|
|Balance as at December 31|43,907,545|21,535,721|

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17.6 In accordance with the terms of the Inter-Creditor Agreement (ICA), the Holding Company is obligated to comply with certain financial and non-financial covenants including Senior Finance Service Coverage Ratio, Finance to equity ratio, Total Finance to Equity Ratio, Current Ratio and Senior Finance to EBITDA. The details of such covenants are:

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|||
|---|---|
|Type of Ratio|Requirement|
|Senior Finance Service Coverage Ratio|At least 1.25x|
|Finance To Equity Ratio|75:25|
|Total Finance to Equity Ratio|80:20|
|Current Ratio|At least 1.0x|
|Senior Finance to EBITDA|Maximum 4.0x|

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As of the reporting date, the Holding Company has not complied with one of its covenant, i.e. current ratio. However, the Holding Company has received a relaxation from the respective banks for a period of 12 months from the reporting date. The Holding Company based on it projections remains confident that there are no indicators that it will have difficulties in complying with the required financial covenants when these will be next tested.

17.7 In accordance with the terms of the facility agreement with Standard Chartered Bank Limited, the Holding Company is also obligated to comply with certain non-financial and financial covenants including Debt Service Cover Ratio, Debt to EBITDA Ratio and Debt to Equity Ratio.

Type of Ratio

Requirement

Debt Service Cover Ratio Debt to EBITDA Ratio Debt to Equity Ratio

Minimum 1.25x Maximum 2.5x Maximum 2x

(Amounts in thousand)

18. government grant 2025 .......Rupees....... 2024 Balance as at January 1 717,092 957,089 Less: released to the consolidated statement of profit or loss (note 31.1) (202,737) (239,997) 514,355 717,092 Less: Current portion (202,737) (171,721) 342,634 514,355

The Holding Company recognised government grant on loan received at below market interest rate (note 17.4) in accordance with IAS 20 'Accounting for government grants and disclosure of government assistance'.
18.1

19. deferred taxation

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Balance as Recognised Recognised Balance as Recognised Recognised Balance as
at January in profit in OCI at December in profit in OCI at December
1, 2024 or loss 31, 2024 or loss 31, 2025
(note 35) (note 35)
------------------------------------------------------ Rupees ------------------------------------------------------
Taxable temporary differences
- Accelerated depreciation allowance
and Staff retirement benefits 18,611,563 1,402,797 2,869 20,017,229 205,800 20,035 20,243,064
Deductible temporary differences
- Provisions (8,209,853) (11,134,532) - (19,344,385) (2,433,465) - (21,777,850)
10,401,710 (9,731,735) 672,844 672,844 (2,227,665) 20,035 (1,534,786)
deferred liabilities 2025 .......Rupees....... 2024
Deferred income (note 20.1) 34,464 38,329
Service benefit obligations 102,437 271,737
Less: Current portion shown under current liabilities (102,437) (62,546)
- 209,191
34,464 247,520
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20. deferred liabilities

This represents Rs. 96,627 received from Engro Powergen Qadirpur Limited (EPQL), an associated company, for the right to use the Holding Company's infrastructure facilities at Daharki Plant by the employees of EPQL for a period of twenty five years. The amount is being amortised over such period.
20.1

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engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

21. trade and other payables Creditors Accrued liabilities (notes 21.1 to 21.3) Advances from customers, contract liabilities (note 21.4) Payable to: - FrieslandCampina Engro Pakistan Limited - Engro Corporation Limited - Engro Foundation - Engro Powergen Thar (Private) Limited - Engro Eximp FZE - Engro Energy Limited - Engro Powergen Qadirpur Llimited - Engro Technical Solutions (Private) Limited - Sindh Engro Coal Mining Company Limited - Defined Contribution Provident Fund - Defined Contribution Provident Fund - NMPT - Defined Contribution Gratuity Fund - MPT - Defined Benefit Pension Fund (note 38.2.1) - Defined Benefit Gratuity Fund - NMPT (note 38.2.1) Deposits / Retention from dealers and contractors (note 21.5) Workers' Welfare Fund (WWF) (note 21.6) Workers' profits participation fund (WPPF) (note 21.6) Withholding tax payable Others	2025.......Rupees.......2024 1,943,556 1,001,679 54,334,991 47,606,014 2,831,579 3,552,441 20 20 165,694 540,222 323,403 393,769 59 2,997 3,324,137 10,105,048 6,700 479,048 1,813 9,884 - 150,542 - 884 1,349 1,358 38 21 20,021 4,790 12,427 12,646 175,033 172,464 517,680 416,296 1,650,018 1,573,007 - 298,260 352,733 144,714 37,951 140,163	2025.......Rupees.......2024 1,943,556 1,001,679 54,334,991 47,606,014 2,831,579 3,552,441 20 20 165,694 540,222 323,403 393,769 59 2,997 3,324,137 10,105,048 6,700 479,048 1,813 9,884 - 150,542 - 884 1,349 1,358 38 21 20,021 4,790 12,427 12,646 175,033 172,464 517,680 416,296 1,650,018 1,573,007 - 298,260 352,733 144,714 37,951 140,163
	65,699,202	66,606,267

21.1 On June 4, 2021, the Sindh High Court (SHC) through its judgement upheld the Sindh Development and Maintenance of Infrastructure Cess Act, 2017 promulgated retrospectively with effect from July 01, 1994 as valid and declaring it within the competence of provincial legislature. The Group maintains adequate provision in these consolidated financial statements and has filed Civil Petition for Leave to Appeal (CPLA) before the SCP to challenge the SHC Judgement. On September 01, 2021, the SCP granted an interim relief in the appeals and suspended the SHC Judgement. The Group carries an accrual of Rs. 5,935,570 (2024: Rs. 4,949,310) in this respect.
21.2 On June 10, 2021, the Holding Company filed a Suit before the SHC in which it prayed that Sui Northern Gas Pipelines Limited (SNGPL) be directed to supply the contracted / committed volume of feed gas at concessionary pricing under the Gas Sale and Purchase Agreement and in accordance with the Fertilizer Policy 2001, Instructions to Bidders and various Economic Coordination Committee decisions.

The SHC was pleased to grant an ad interim stay vide its order dated June 21, 2021, directing the parties to maintain status quo with regard to disconnection of gas supply and pricing. The Group, without prejudice to the pending Suit and any admission of liability, has on prudent basis recorded an accrual of Rs. 21,219,869 (2024: Rs. 21,219,869) in these consolidated financial statements.

21.3 In 2022, the Holding Company received a letter from one of its gas supplier, which indicated that the pricing of gas supplied to the Holding Company from the aforementioned gas field would be higher of the applicable Petroleum Policy or the gas price notified by the Oil and Gas Regulatory Authority (“OGRA”) for the fertilizer sector and such charge shall be applicable from the date of execution of the Gas Sale and Purchase Agreement (GSPA).

In this regard, the Holding Company has submitted a formal response to the gas supplier. Without prejudice to the foregoing and any admission of liability, the Group has on prudent basis recorded an accrual amounting to Rs. 2,380,450 (2024: Rs. 2,380,450) in these consolidated financial statements.

(Amounts in thousand)

21.4 This represents advances received by the Group from customers for goods to be delivered. The advances outstanding as at January 01, 2025 have been fully recognised as revenue during the year.
21.5 The amount is kept in separate term deposits account as per the terms of agreements and is not utilised for the purpose of the business of the Group.

21.6 movement of WPPF / WWF Balance as at January 1 Charge for the year (note 30) Payments during the year Balance as at December 31	2025	2024
	(260,199) 1,650,018 298,260 1,573,007

22. provision for gas infrastructure development cess

The Honorable Supreme Court of Pakistan (SCP) through its judgement dated August 13, 2020 (judgement) declared that the levy imposed under the Gas Infrastructure Development Cess (GIDC) Act, 2015 (the GIDC Act) is valid and in accordance with the provisions of the Constitution of Pakistan 1973 (the Constitution). The SCP in its judgement stated that the Government has already collected Rs. 295,000,000 and this amount combined with the outstanding amount would be in the vicinity of Rs. 700,000,000. The SCP, therefore, issued the following directions:

It restrained the Federal Government from charging further GIDC until such time that the GIDC already collected and accrued (but not yet collected), is expended on projects listed under the GIDC Act;
As all industrial and commercial entities which consume gas for their business activities pass on the burden to their customers, therefore, GIDC that has become due up to July 31, 2020, and has not been recovered so far, shall be recovered by the gas companies responsible under the Act to recover from their consumers in twenty-four equal monthly installments, without the component of Late Payment Surcharge (LPS); and
In case, no work is carried out on the gas infrastructure pipelines in the manner and / or time specified in the judgment, the purpose of levying GIDC shall be deemed to have been frustrated and the GIDC Act would become completely in-operational and considered dead for all intents and purposes.

Pursuant to the Judgement, the gas suppliers began invoicing the GIDC installments for recovery with effect from August 01, 2020.

Aggrieved by the judgement, the Holding Company filed a review petition before the SCP, which was dismissed by the SCP on November 02, 2020 (Review Decision). However, the Review Decision (i) noted that the Government of Pakistan (GoP) is agreeable to recover the unpaid arrears in 48 monthly installments instead of 24 monthly installments provided the time period for the projects was extended to 12 months from 6 months; and (ii) upheld the validity of Section 8(2) of the GIDC Act. The SCP protected the rights of the Industrial Sector (excluding Fertilizer Fuel Stock) to approach the appropriate fora for enforcement of the exemption provided under the provision to Section 8(2) of the GIDC Act.

Subsequent to the Review Decision, the Holding Company filed a rectification application before the SCP seeking a clarification regarding the increase in number of installments.

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engro fetilizers limited

annual report 2025

(Amounts in thousand)

The Holding Company also filed a suit before the SHC on December 17, 2020 against collection of GIDC on non-concessionary feed gas supplied under the non-fixed price contracts and the fuel gas, on the basis of relief available under section 8(2) of the GIDC Act and on the grounds that factual determination of the GIDC passed-on is to be carried out. The SHC granted the Holding Company an interim stay restraining the impleaded gas companies from taking coercive action against the Holding Company for non-payment of GIDC installments.

Further, against the GIDC installment invoice received from SNGPL on concessionary gas supplied under the fixed price Gas Sale and Purchase Agreement (GSPA) dated April 11, 2007, the Holding Company approached the SHC to challenge this imposition. The Holding Company has obtained a stay order in its favour and the SHC has restrained SNGPL from taking any coercive against the Holding Company on collecting GIDC on feed stock gas supplied to the Holding Company under the GSPA. The management has made an assessment (as confirmed by the legal advisor) that there are reasonable chances of a favourable outcome in relation to the legal proceedings filed against SNGPL for feed gas supplied under the GSPA. Hence, no provision on account of GIDC has been recorded by the Holding Company in these consolidated financial statements in respect of feed gas received under the GSPA.

23. short-term borrowings 23.1 Holding Company Short-term running finances (notes 23.1.1 and 23.2) Privately placed short-term sukuk (note 23.1.2)	3,022,723 12,451,850 20,000,000 - 2025.......Rupees.......2024	3,022,723 12,451,850 20,000,000 - 2025.......Rupees.......2024
	23,022,723	12,451,850

23.1.1 The Holding Company has funded facilities for short-term finances available from various banks and institutional investors amounting to Rs. 43,420,000 (2024: Rs. 68,420,000) along with non-funded facilities of Rs. 12,532,000 (2024: Rs. 11,432,000) for bank guarantees, out of which facilities amounting to Rs. 11,525,000 (2024: Rs. 11,525,000) and Rs. 7,100,000 (2024: Rs. 5,100,000) of non-funded facilities are interchangeable with the Subsidiary Company. The rates of mark-up on funded bank overdraft facilities ranged from minus 0.05% to 0.5% (2024: 2.00% to 0.50%) per annum over 1-month, 3-month and 6-month KIBOR and all facilities are secured by floating charge upon all present and future stocks including raw and packing materials, finished goods, stores and spares and other merchandise and on all present and future book debts, outstanding monies, receivable claims and bills of the Holding Company. The Holding Company has utilised Rs. 3,022,723 (2024: Rs. 12,451,622) from funded facilities and Rs. 6,801,834 (2024: Rs. 6,817,869) from non-funded facilities as at the reporting date.
23.1.2 The Holding Company has placed unsecured Privately Placed Short Term Sukuk (PPSTS) with an issue size of Rs. 20,000,000. These are payable within six months from the issuance date and carry a markup at the rate of 3 months KIBOR minus 0.15%. These proceeds will be used for the Holding Company's working capital management.

23.2 Subsidiary Company

The facilities for short-term running finances, available from various banks, amounting to Rs. 12,525,000 (2024: Rs. 11,525,000) along with non-funded facilities of Rs. 8,000,000 (2024: Rs. 5,100,000) for bank guarantees, out of which facilities amounting to Rs. 11,525,000 (2024: Rs. 11,525,000) and Rs. 7,100,000 (2024: Rs. 5,100,000) of non-funded facilities are interchangeable with the Holding Company. The rates of markup on funded bank overdraft facilities ranged from 0.2% to 0.5% per annum over 1-month and 3-month KIBOR. These facilities are secured by floating charge upon all present and future stocks including raw and packing materials, finished goods, stores and spares and other merchandise and on all present and future book debts, outstanding monies, receivable claims and bills of the Holding Company. As at December 31, 2025, the Subsidiary Company has utilised Nil (December 31, 2024: Rs. 228) from funded facilities and Rs. 3,166,136 (2024: Rs 3,166,136) from non-funded facilities.

(Amounts in thousand)

24. contingencies and commitments

Contingencies

24.1 As at December 31, 2025, bank guarantees of Rs. 9,967,970 (2024: Rs. 9,984,004) have been issued in favour of third parties.
24.2 In 2021, the income tax department [i.e. Large Taxpayers Unit (LTU)] initiated income tax audits of the Holding Company u/s 177 of the Income Tax Ordinance, 2001 (the Ordinance) for the Tax Year (TY) 2015, 2016, 2018 and 2020 and sales tax audits u/s 25 of the Sales Tax Act, 1990 for TY 2017, 2018 and 2019 in accordance with the sectoral audit directives issued by Federal Board of Revenue (FBR). As such, the Holding Company received audit selection notices for all these years. The sales tax audit selection notices in respect of all three years were challenged in the Sindh High Court (SHC) where the Court dismissed the audit notices thereby deciding the matter in favour of the Holding Company.

In respect of income tax audits, the tax department completed the amendments for all tax years creating an aggregate demand of Rs. 18,566,262. As per current status, all major issues raised in the amendments stand concluded except for tax year 2018 where demand of Rs. 1,515,000 has been raised. The Holding Company filed an Income Tax Reference Application in the SHC where the matter has been remanded back to the Appellate Tribunal Inland Revenue (ATIR). A similar matter of tax year 2019 involving demand of Rs. 547,000 is pending in the ATIR.

Management considers, based on the tax advisor’s opinion, that it has reasonable grounds to defend the case and therefore will not be exposed to any additional liability in this respect.

24.3 In 2022, in respect of TY 2018, the Holding Company received an order from the Assistant Commissioner Inland Revenue (ACIR) restricting brought forward losses having a tax impact of Rs. 639,001. This disallowance had been made in the assessment orders relating to prior years which are pending in appeals. Certain errors have been made in relation to allowance of credits which will be taken up in rectification.

Management considers, based on the tax advisor’s opinion, that it has reasonable grounds to defend the case and therefore will not be exposed to any additional liability in this respect.

24.4 The Holding Company filed a constitutional petition in the SHC against the Ministry of Petroleum and Natural Resources (MPNR), Ministry of Industries and Production (MoIP) and SNGPL for continuous supply of 100 mmscfd gas per day to the Holding Company's new plant (Enven) and to prohibit from suspending, discontinuing or curtailing the aforementioned supply. Through its order dated October 18, 2011, the SHC ordered that SNGPL should supply 100 mmscfd gas per day to the Holding Company’s new plant. However, five petitions have been filed in the SCP against the aforementioned order of the SHC by SNGPL, MPNR, Agritech Limited, Pak Arab Fertilizers and Kohinoor Mills Limited alongwith twenty one other companies (mainly engaged in textile business). The aforementioned petitions are pending for further hearing. The Holding Company’s management, as confirmed by the legal advisor, considers the chances of these petitions being allowed to be low.

Further, the Holding Company upon continual curtailment of gas after the aforementioned decision of the SHC has filed an application in respect of Contempt of Court under Article 199 & 204 of the Constitution of Pakistan. The Holding Company, in the aforementioned application has submitted that SNGPL and MPNR have failed to restore full supply of gas to the Holding Company’s plant despite the judgement of the SHC in the Holding Company’s favor. A show cause notice has also been issued against MPNR and SNGPL dated December 31, 2011 by the SHC. The application is pending for hearing and no orders have yet been passed in this regard.

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rooted in character 350 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

24.5 All Pakistan Textile Processing Mills Association (APTMA), Agritech Limited (Agritech), Shan Dying & Printing Industries (Private) Limited and twenty seven others have each contended, through separate proceedings filed before the Lahore High Court that the supply to the Holding Company’s new plant is premised on the output from Qadirpur gas field exceeding 500 mmscfd by 100 mmscfd and, therefore, the Gas Sale and Purchase Agreement (GSA) dated April 11, 2007 between the Holding Company and SNGPL be declared void ab initio because the output of Qadirpur gas field has infact decreased. Agritech has additionally alleged discrimination in that it is receiving less gas than the other fertilizer companies on the SNGPL system. The Holding Company has out rightly rejected these contentions, and is of the view that it has a strong case for the reasons that (i) 100 mmscfd gas has been allocated to the Holding Company through a transparent international competitive bidding process held by the Government of Pakistan, and upon payment of valuable license fee; (ii) GSA guarantees uninterrupted supply of gas to the Holding Company's new plant, with right to first 100 mmcfd gas production from the Qadirpur gas field; and (iii) both the Holding Company and the Qadirpur gas field are located in Sindh. Also neither the gas allocation by the Government of Pakistan nor the GSA predicates the gas supply from Qadirpur gas field producing 100 mmscfd over 500 mmscfd. No orders have been passed in this regard and the petition has also been adjourned sine die given that similar matter is pending in the SCP. However, the Holding Company’s management, as confirmed by the legal advisor, considers chances of petitions being allowed to be low.
24.6 In 2013, the Holding Company, along with other fertilizer companies, received a show cause notice from the Competition Commission of Pakistan (CCP) for initiating action under the Competition Act, 2010 (2010 Act) in relation to alleged unreasonable increase in fertilizer prices. The Holding Company has responded in detail that factors resulting in such increase were mainly due to imposition of infrastructure cess, sales tax and gas curtailment. The CCP issued an order in March 2013, whereby it held that the Holding Company has a dominant position in the urea market and that it has abused the same by unreasonable increases in urea prices during the period December 2010 to December 2011. The CCP also held another major fertilizer company to be responsible for abusing its dominant position. Moreover, the CCP imposed a penalty of Rs. 3,140,000 and Rs. 5,500,000 on the Holding Company and the other fertilizer company, respectively. An appeal has been filed before the Competition Appellate Tribunal (CAT) and a writ has been filed in the SHC wherein stay has been granted in favour of the Holding Company restraining CCP and Federation of Pakistan (i.e. Respondents) from taking any coercive action.

In case of the other fertilizer company, the CAT has transferred the case back to the CCP for reassessment. The Holding Company has also challenged the composition of the CAT before the SHC and has secured an interim order in its favour whereby the CAT is restrained from passing any final order against the Holding Company during the pendency of the petition. The Holding Company's management believes that the chances of ultimate success are strong and, hence, no provision has been made in this respect.

In 2024, the petitions were disposed of with a direction to the CAT to decide the Holding Company's appeal and in the meantime CCP has been restrained from taking any adverse action against us on the basis of the 2013 order.

24.7 In 2015, the Holding Company received a sales tax order from the tax department for the tax periods January 01, 2013 to December 31, 2013, pertaining to discharge of output tax liability, on assumed production of urea amounting to Rs. 402,875 and on the presumption that output tax liability is not being discharged by the Holding Company on advances received from dealers amounting to Rs. 1,844,075. The Holding Company filed an appeal thereagainst, with the CIR(A) which decided the matters in favour of the Holding Company. The department thereafter challenged the decision of the CIR(A) with the ATIR which is pending adjudication. The Holding Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these consolidated financial statements.

(Amounts in thousand)

24.8 In 2018, the tax department [i.e., Large Taxpayers Unit (LTU)] issued an order for the period June 2016 to July 2017 with a demand of Rs. 1,006,000 mainly on account of further sales tax to be charged on fertilizers sales to unregistered persons. The Holding Company filed an appeal before the CIR(A) who disposed off the appeal in favour of the tax department. Thereafter, the Holding Company filed an appeal before the ATIR, and it also decided the same in favour of the tax department. The Holding Company challenged the ATIR Order, to the extent of its ruling in relation to exemption from further sales tax, before the SHC by filing Sales Tax Reference Application. On October 11, 2021, the SHC granted an ad-interim order restraining the tax department from taking coercive action against the Holding Company in respect of the recovery of the impugned demand. The Holding Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these consolidated financial statements.
24.9 During the year, the tax department [i.e. Large Taxpayers Unit (LTU)] issued an order for the period June 2022 under the Sales Tax Act, 1990 reducing the Holding Company's sales tax refund claim by Rs. 660,000. The Holding Company has filed an appeal before the CIR(A) which is currently pending adjudication. The Holding Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these consolidated financial statements.
24.10 During the year, the Subsidiary Company has received an order from the Sindh Revenue Board in respect of Sindh Sales Tax Withholding Proceedings creating a demand of Rs. 303,000 on account of alleged short withholding of Sindh Sales Tax on certain expenses for years 2019 to 2021. The Subsidiary Company has filed an appeal before the CIR(A) against this order which is pending adjudication. The Subsidiary Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these consolidated financial statements.
24.11 The Federal Constitutional Court (FCC) has upheld the constitutionality of Sections 4B and 4C of the Income Tax Ordinance, 2001. Further details are disclosed in note 33 of these consolidated financial statements.
24.12 For tax matters, refer note 33 to these consolidated financial statements.
24.13 Commitments

2025 .......Rupees....... 2024

Commitments in respect of: - Capital expenditure - Operational items 25. net sales Revenue from contracts with customers - Gross sales: - manufactured products - purchased and packaged products - services Less: Trade discounts Less: Sales tax and duties	24,170,211 11,100,889	32,443,785 9,533,223
	35,271,100	41,977,008
	211,632,299 48,473,714 - 260,106,013 (7,450,223) (15,525,004)	192,233,463 82,778,673 246,559 275,258,695 (1,642,037) (16,941,495)
	237,130,786	256,675,163

25.1 All revenue earned by the Group is Shariah Compliant.

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annual report 2025

(Amounts in thousand)

26. cost of sales

2025 .......Rupees....... 2024

cost of sales	2025.......Rup	ees.......2024
Cost of sales - Manufactured products Raw materials consumed Salaries, wages and staff welfare (note 26.1) Fuel and power Repairs and maintenance Depreciation (note 4.2) Amortisation (note 5.3) Consumable stores Training, HSE and other related expenses Purchased services Travelling Communication, stationery and other office expenses Insurance Rent, rates and taxes Other expenses Manufacturing cost Add: Opening stock of work in process Less: Closing stock of work in process (note 9) Cost of goods manufactured Add: Opening stock of finished goods Less: Closing stock of finished goods (note 9) Cost of sales - Purchased and packaged products Opening stock Add: Purchases during the year Less: Closing stock
	82,028,878 4,030,040 22,983,869 3,224,992 4,456,352 61,433 2,725,617 1,473,634 1,545,290 135,381 52,109 1,289,009 3,747 1,642	88,940,369 3,963,232 21,527,504 6,974,954 3,698,179 39,924 2,106,094 1,325,938 1,263,032 185,689 45,632 1,332,680 34,229 5,263
	124,011,993 44,113 (269,136)	131,442,719 279,974 (44,113)
	123,786,970 6,887,648 (5,776,028)	131,678,580 740,739 (6,887,648)
	124,898,590 14,524,128 39,761,425 (14,606,353) 39,679,200	125,531,671 9,991,335 63,752,437 (14,524,128) 59,219,644
	164,577,790	184,751,315

26.1 Salaries, wages and staff welfare includes Rs. 240,567 (2024: Rs. 241,639) in respect of staff retirement benefits.

27. selling and distribution expenses

Salaries, wages and staff welfare (note 27.1) Training, HSE and other related expenses Product transportation and handling Fuel for product transportation Royalty (note 27.2) Repairs and maintenance Advertising and marketing Rent, rates and taxes Communication, stationery and other office expenses Travelling Depreciation (note 4.2) Amortisation (note 5.3) Purchased services Insurance Others	1,751,407 1,463,231 259,188 204,306 8,012,837 6,797,385 4,419,942 4,543,655 3,319,109 3,020,590 50,606 35,565 354,340 469,669 1,321,800 755,529 23,323 19,075 246,078 316,410 165,166 149,243 565 15,219 155,938 134,067 10,391 11,575 122,419 25,324 2025.......Rupees.......2024	1,751,407 1,463,231 259,188 204,306 8,012,837 6,797,385 4,419,942 4,543,655 3,319,109 3,020,590 50,606 35,565 354,340 469,669 1,321,800 755,529 23,323 19,075 246,078 316,410 165,166 149,243 565 15,219 155,938 134,067 10,391 11,575 122,419 25,324 2025.......Rupees.......2024
	20,213,109	17,960,843

27.1 Salaries, wages and staff welfare includes Rs. 148,796 (2024: Rs. 121,568) in respect of staff retirement benefits.
27.2 Royalty is paid to the Parent Company which has its registered office at 19th floor, The Harbour Front Building, Plot Number HC-3, Block 4, Scheme Number 5, Clifton, Karachi.

28. administrative expenses Salaries, wages and staff welfare (note 28.1) Training, HSE and other related expenses Repairs and maintenance Rent, rates and taxes Communication, stationery and other office expenses Travelling Depreciation (note 4.2) Amortisation (note 5.3) Purchased services Aircraft operating expense (note 28.2) Insurance Other expenses	969,350 934,334 126,868 72,553 4,735 6,070 337,645 276,186 8,746 25,974 84,590 65,025 385,876 371,076 185,620 185,542 2,134,725 1,931,514 379,331 285,015 89,317 56,954 16,339 83,155 2025.......Rupees.......2024	969,350 934,334 126,868 72,553 4,735 6,070 337,645 276,186 8,746 25,974 84,590 65,025 385,876 371,076 185,620 185,542 2,134,725 1,931,514 379,331 285,015 89,317 56,954 16,339 83,155 2025.......Rupees.......2024
	4,723,142	4,293,398

28.1 Salaries, wages and staff welfare includes Rs. 48,768 (2024: Rs. 48,912) in respect of staff retirement benefits.
28.2 This is net of recoveries from group companies.

29. other income


other income On financial assets Income on loan to Parent Company Income on Government securities, Term Deposit receipts, mutual fund units and bank deposits (note 29.1) On non-financial assets Gain on disposal of operating assets (note 29.2) Scrap sales (note 29.2) Reversal of provision for impairment against trade debts - net Others	929 - 801,432 2,498,037 802,361 2,498,037 1,069,601 - 400,785 95,008 2,756 31,020 274,692 301,145 1,747,834 427,173 2025.......Rupees.......2024
	2,550,195	2,925,210

29.1 It includes profit earned on Shariah Compliant bank deposits and units of Shariah Compliant mutual funds amounting to Rs. 21,501 (2024: Rs. 183,531).
29.2 These represents Shariah Compliant income.

rooted in 353 character driven leadership

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engro fetilizers limited

annual report 2025

(Amounts in thousand)

30. other operating expenses

2025 .......Rupees....... 2024

Workers' profits participation fund (note 21.6) Workers' welfare fund (note 21.6) Donation (notes 30.1 and 30.1.1) Legal and professional Directors' fees (note 37) Auditors' remuneration (note 30.3) Loss on disposal of operating assets Others (note 30.2)	2,091,542 1,197,011 402,895 132,224 7,070 35,210 - 723,915	2,358,934 935,333 463,819 100,552 14,419 34,564 191,072 414,713
	4,589,867	4,513,406

30.1 During the year, the Holding Company made the donations to Engro Foundation amounting to Rs. 353,687 (2024: Rs. 396,000). Mr. Ahsan Zafar Syed, the Director of the Holding Company, is also the trustee of Engro Foundation.
30.1.1 This also includes an amount of Rs. 49,208 (2024: Rs. 67,819) recharged by the Parent Company for operational expenditure of Engro Foundation.
30.2 This includes the allocation of gain on disposal of aircraft as per the cost sharing agreement with associated undertakings amounting to Rs. 555,501 (2024: Nil).

30.3 auditors' remuneration

auditors' remuneration Fee for: - audit of annual financial statements - review of half yearly financial information - review of compliance with the Code of Corporate Governance - certifications and other advisory services - taxation services Reimbursement of expenses finance cost Interest / mark-up / return on: - long-term borrowings under: - interest / mark up arrangements (notes 31.1 and 31.2) - Shariah permissible arrangements - short-term borrowings under: - interest / mark up arrangements - Shariah permissible arrangements Foreign exchange gain	6,450 5,317 1,450 1,158 450 88 1,857 4,071 22,634 21,731 2,369 2,199 2025.......Rupees.......2024	6,450 5,317 1,450 1,158 450 88 1,857 4,071 22,634 21,731 2,369 2,199 2025.......Rupees.......2024
	35,210	34,564
	1,262,763 1,518,904 2,781,667 1,262,799 2,126,273 3,389,072 -	887,593 - 887,593 2,452,410 815,534 3,267,944 (26,958)
	6,170,739	4,128,579

31. finance cost

31.1 This is net of government grant income on TERF loans amounting to Rs. 202,737 (2024: Rs. 239,997) (note 18).

(Amounts in thousand)

31.2 This is net of recoveries from group companies in respect of finance cost charge for the use of aircraft.

32. gain on subsidy receivable from GOP

This represents gain recognised on 'Subsidy receivable from the GoP (note 11.3) in accordance with the 'Expected Credit Loss' model under IFRS 9, giving consideration to the time value of money based on expected recovery of subsidy receivable. The Group, is confident of full recovery of the subsidy amount from the GoP.

33. taxation

taxation Current - for the year - for prior years (note 33.1) Deferred (note 19)	16,091,101 18,621,831 3,539,569 8,005,586 19,630,670 26,627,417 (2,227,665) (9,731,735) 17,403,005 16,895,682 2025.......Rupees.......2024	16,091,101 18,621,831 3,539,569 8,005,586 19,630,670 26,627,417 (2,227,665) (9,731,735) 17,403,005 16,895,682 2025.......Rupees.......2024
	16,091,101 3,539,569	18,621,831 8,005,586
	19,630,670 (2,227,665)	26,627,417 (9,731,735)
	17,403,005	16,895,682

The Group continually evaluates its tax position based on amendments by the taxation authorities and developments thereon. Adequate provision in this respect is being maintained in these consolidated financial statements without prejudice to the tax proceedings before any appellate / judicial forum and admission of any liability in this respect. Matters where there is a difference between the position taken by taxation authorities and the Group’s own position based on its assessment of law and in accordance with its legal / tax consultant's opinion, such matters are being reported as contingent liabilities. Please refer note 24 in this respect.

33.1 In accordance with the provisions of sections 4B and 4C of the Ordinance, super tax had been levied on the Group for tax years 2015 to 2019 and from tax year 2022 onwards, respectively. These enactments were challenged by the Holding Company in the SHC and afterwards by the FBR in the SCP. During the year, in accordance with the 27th Constitutional Amendment, all pending litigations of sections 4B and 4C of the Ordinance were called from all High Courts and SCP in the Federal Constitutional Court (FCC). Subsequent to the year end, the FCC decided on the matters and has upheld the constitutionality of sections 4B and 4C of the Ordinance.

In respect of the same, the Group has recognised adequate provision against additional super tax levy of six percent for TY 2022.

33.2 Relationship between tax expense and accounting profit

The tax on the Group's profit before tax differs from the theoretical amount that would arise using the Group's applicable tax rate as follows:

Profit before taxation Tax calculated at the rate of 29% (2024: 29%) Tax effect of: - Expenses not allowed for tax - Final / Special Tax Regime and exempt income Super tax Effect of prior year tax charge / (reversal) (note 33.3) Tax charge for the year	40,031,049 45,155,920 2025.......Rupees.......2024	40,031,049 45,155,920 2025.......Rupees.......2024
	40,031,049	45,155,920
	11,609,004 (132,920) 366,268 3,881,300 1,679,353	13,095,217 (332,849) (16,333) 4,422,998 (273,351)
	17,403,005	16,895,682

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(Amounts in thousand)

33.3 This is net of corresponding deferred tax impact.

34. earnings per share (EPS)

34.1 Basic EPS has been calculated by dividing the profit attributable to equity holders of the Holding Company by weighted average number of ordinary shares in issue during the year.
34.2 As at December 31, 2025, there is no dilutive effect on the basic earnings per share of the Holding Company. EPS is based on the following:

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|||||
|---|---|---|---|
|2025|.......Rupees.......|2024|
|Profit for the year|22,628,044|28,260,238|
|.......Numbers of shares.......|
|Weighted average number of ordinary|
|shares (in thousands)|1,335,299|1,335,299|
|financing structure / mode|2025|.......Rupees.......|2024|
|Conventional mode:|
|Assets|
|Short-term investments|9,404,607|3,689,841|
|Long-term investments|4,348,915|4,268,249|
|Cash and bank balances|7,865,158|3,669,563|
|21,618,680|11,627,653|
|Liabilities|
|Long-term borrowings|19,657,545|8,535,721|
|Short-term borrowings|1,602,297|7,318,439|
|21,259,842|15,854,160|
|Shariah compliant mode:|
|Assets|
|Short-term investments|6,608,243|1,011|
|Cash and bank balances|177,589|638,672|
|6,785,832|639,683|
|Liabilities|
|Long-term borrowings|24,250,000|13,000,000|
|Short-term borrowings|21,420,426|5,133,411|
|45,670,426|18,133,411|

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35. financing structure / mode

(Amounts in thousand)

36. shariah compliance disclosure

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|||||||||
|---|---|---|---|---|---|---|---|
|2025|2024|
|Note|Conventional|Shariah|Total|Conventional|Shariah|Total|
|Compliant|Compliant|
|--------------Rupees--------------|--------------Rupees--------------|
|Statement of Financial Position|
|Borrowings|17|19,657,545|24,250,000|43,907,545|8,535,721|13,000,000|21,535,721|
|Short-term borrowings|23|1,602,297|21,420,426|23,022,723|7,318,439|5,133,411|12,451,850|
|Accrued interest / mark-up|696,308|738,002|1,434,310|963,611|245,777|1,209,388|
|Long-term investments|6|4,348,915|-|4,348,915|4,268,249|-|4,268,249|
|Short-term investments|13|9,404,607|6,608,243|16,012,850|3,689,841|1,011|3,690,852|
|Accrued income|147,159|-|147,159|271,970|110|272,080|
|Cash and bank balances|14|7,865,158|177,589|8,042,747|3,669,477|638,672|4,308,149|
|Statement of profit or loss|
|Net sales|25|-|237,130,786 237,130,786|-|256,675,163 256,675,163|
|Other income|29|1,058,308|1,491,887|2,550,195|2,646,671|278,539|2,925,210|
|Finance cost|31|2,525,562|3,645,177|6,170,739|3,313,045|815,534|4,128,579|

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37. remuneration of chief executive, directors and executives

37.1 The aggregate amounts for remuneration, including all benefits, to chief executive, directors and executives of the Group are given below:

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||||||||
|---|---|---|---|---|---|---|
|2025|2024|
|Directors|Executives|Directors|Executives|
|Chief|Others|Chief|Others|
|Executive|Executive|
|----------------------------------------------Rupees----------------------------------------------|
|Managerial remuneration|
|including bonus|99,864|-|4,344,969|117,536|1,969|3,894,028|
|Staff retirement benefits|7,132|-|394,579|5,630|168|345,214|
|Other benefits|86|-|77,532|1,909|39|74,197|
|Fees (note 30)|-|7,070|-|-|14,619|-|
|Total|107,082|7,070|4,817,080|125,075|16,795|4,313,439|
|Number of persons, including those|
|who worked part of the year|1|10|709|2|11|626|

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37.2 The Group also provides vehicles and certain household items for use of some executives and directors.
37.3 Premium charged in respect of directors' indemnity insurance policy, purchased by the Holding Company during the year, amounted to Rs. 246 (2024: Rs. 301).

38. retirement and other service benefits

38.1 Salient features

The Group offers a defined post-employment gratuity benefit to permanent management and non-management employees. In addition, until June 30, 2005, the Group offered a defined post-employment pension benefit to management employees in service which has been discontinued and the plan now only covers a handful of retired pensioners.

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(Amounts in thousand)

The gratuity and pension funds are governed under the Trusts Act, 1882, Trust Deed and the Rules of the ��

Responsibility for governance of plan, including investment decisions and contribution schedule lie with the Board of Trustees of the funds.

The Group faces the following risks on account of gratuity and pension funds:

Final salary risks - The risk that the final salary at the time of cessation of service is greater than what was assumed. Since the benefit is calculated on the final salary, the benefit amount would also increase proportionately.
Asset volatility - Most assets are invested in risk free investments of 3, 5 or 10 year Special Saving Certificates, Regular Income Certificates, Defence Saving Certificates or Government Bonds. However, investments in equity instruments are subject to adverse fluctuations as a result of change in the market price.

�� corporate bond yields. A decrease in corporate bond yields will increase plan liabilities, although this will be partially offset by an increase in the value of the current plans’ bond holdings.

Investment risks - The risk of the investment underperforming and not being sufficient to meet the liabilities. This risk is mitigated by closely monitoring the performance of investments.
Risk of insufficiency of assets - This is managed by making regular contribution to the funds as advised by the actuary.
In addition to above, the pension fund exposes the Group to Longevity risk i.e. the pensioners survive longer than expecte.

38.2 Valuation results

The latest actuarial valuation of the defined benefit plans was carried out as at December 31, 2025, using the Projected Unit Credit Method. Details of the defined benefit plans are as follows:

38.2.1 Consolidated statement of financial position reconciliation Present value of obligation (note 38.2.3) Fair value of plan assets (notes 38.2.4) Net liability / (asset) at end of the year	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)
	538,121 (363,088)	496,642 (324,178)	34,115 (63,547)	33,044 (55,587)	51,314 (38,887)	53,398 (40,752)
	175,033	172,464	(29,432)	(22,543)	12,427	12,646

(Amounts in thousand)

---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)
172,464 46,913 (44,344)	136,158 42,883 (6,577)	(22,543) (1,541) (5,348)	(25,988) (2,538) 5,983	12,646 1,462 (1,681)	16,898 2,510 (6,762)
175,033	172,464	(29,432)	(22,543)	12,427	12,646

496,642 25,987 61,186 (20,277) (25,417)	392,565 21,322 62,967 (17,669) 37,457	33,044 1,110 4,090 - (4,129)	75,411 1,826 8,295 (46,582) (5,906)	53,398 - 6,196 (5,262) (3,018)	57,602 - 9,096 (5,180) (8,120)
538,121	496,642	34,115	33,044	51,314	53,398

324,178 40,260 (20,277) 18,927	256,407 41,406 (17,669) 44,034	55,587 6,741 - 1,219	101,399 12,659 (46,582) (11,889)	40,752 4,734 (5,262) (1,337)	40,704 6,586 (5,180) (1,358)
363,088	324,178	63,547	55,587	38,887	40,752

25,987 20,926	21,322 21,561	1,110 (2,651)	1,826 (4,364)	- 1,462	- 2,510
46,913	42,883	(1,541)	(2,538)	1,462	2,510

59,388	65,458	8,029	490	3,397	5,228

38.2.2 Movement in net liability / (asset) recognised

38.2.3 Movement in defined benefit obligation

38.2.4 Movement in fair value of plan assets

38.2.5 Charge / (reversal) for the year Current service cost Net interest cost

38.2.6 Actual return on plan assets

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(Amounts in thousand)

---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)	---------------------------------------Rupees--------------------------------------- NMPT MPT 2025 2024 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan- Funded (Curtailed)
(24,925) (492)	38,850 (1,393)	(4,129) -	(5,906) -	3,018) -	(8,120) -
(25,417)	37,457	(4,129)	(5,906)	(3,018)	(8,120)
40,260 (59,388) 201	41,406 (65,458) (19,982)	6,741 (8,029) 69	12,659 (490) (280)	4,734 (3,397) -	6,586 (5,228) -
(18,927)	(44,034)	(1,219)	11,889	1,337	1,358
(44,344)	(6,577)	(5,348)	5,983	(1,681)	(6,762)

11.00% 11.00% 10.00% 10.00%	12.25% 12.25% 11.25% 11.25%	11.00% 11.00% 11.00% 11.00%	12.25% 12.25% 12.25% 12.25%	11.00% 11.00% - -	12.25% 12.25% - -
SLIC (2001-05) - I Light		SLIC (2001-05) -1 Heavy		(2001-05) - I -

38.2.10 Sensitivity Analysis

The impact of 1% change in following variables on defined benefit obligation is as follows:

Discount rate Long term salary increases Long term pension increases Discount rate Long term salary increases Long term pension increases 38.2.11 Maturity Profile Time in Years 1 2 3 4 5-10 11-15 16-20 20+ Weighted average duration (years)	Increase in assumption Decrease in assumption 2025	Increase in assumption Decrease in assumption 2025
	497,027 584,852 - 33,689 34,549 - 48,280 - 54,675 584,852 496,320 - 34,553 33,685 - 54,707 - 48,254 ---------------------------------Rupees--------------------------------- Gratuity Plans Gratuity Plans MPT Pension Plan Pension Plan MPT NMPT NMPT 2024
	Increase in assumption	Decrease in assumption
	456,675 542,238 - 32,369 33,736 - 50,108 - 57,055 542,238 455,997 - 35,178 46,109 23,380 56,700 471,080 563,932 745,753 1,707,454 7.64 33,736 32,363 - 19,603 5,367 10,914 5,982 - - - - 1.25 57,089 - 50,080 4,715 4,266 3,828 3,405 12,835 3,838 1,086 429 5.91 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2025 ---------------------------------Rupees--------------------------------- Gratuity Plans Gratuity Plans MPT Pension Plan Pension Plan MPT NMPT NMPT
		542,238 455,997 - 33,736 32,363 - 57,089 - 50,080
		2025
		35,178 46,109 23,380 56,700 471,080 563,932 745,753 1,707,454 7.64 19,603 5,367 10,914 5,982 - - - - 1.25 4,715 4,266 3,828 3,405 12,835 3,838 1,086 429 5.91 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT

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(Amounts in thousand)

Time in Years 1 2 3 4 5-10 11-15 16-20 20+ Weighted average duration (years)	--------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024
	20,139 37,378 48,648 25,043 439,948 641,253 838,640 2,519,956 8.05 937 21,843 6,049 11,926 6,609 - - - 2.04 4,713 4,262 3,823 3,399 12,792 3,816 1,080 429 6.16

38.2.15 Historical information of staff retirement benefits:

---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021
538,121 (363,088)	496,642 (324,178)	392,565 (256,407)	349,731 (222,668)	311,658 (214,650)
175,033	172,464	136,158	127,063	97,008

34,115 (63,547)	33,044 (55,587)	75,411 (101,399)	90,524 (113,128)	72,202 (106,426)
(29,432)	(22,543)	(25,988)	(22,604)	(34,224)

51,314 (38,887)	53,398 (40,752)	57,602 (40,704)	19,103 (43,900)	22,324 (42,821)
12,427	12,646	16,898	(24,797)	(20,497)

Gratuity Plan - NMPT

Present value of defined benefit obligation Fair value of plan assets Deficit

Gratuity Plan - MPT

Present value of defined benefit obligation Fair value of plan assets Surplus

Pension Plan

Present value of defined benefit obligation Fair value of plan assets Deficit / (Surplus)

38.3 Defined contribution plans

38.2.12 Plan assets comprise of the following:

Plan assets comprise of the following:
Fixed income instruments Investment in equity instruments Others (including bank balance)	Defined Benefit Gratuity Plans - Funded				Defined Benefit Pension Plan - Funded (Curtailed)
	NMPT		MPT*
	2025 Rupees (%)		2025 Rupees (%)		2025 Rupees (%)
	256,411 86,463 20,214	83 12 5	46,191 16,265 1,091	72 26 2	- - 38,887	- - 100
	363,088	100	63,547	100	38,887	100

An amount of Rs. 429,121 (2024: Rs. 355,366) has been charged during the year in respect of defined contribution plans maintained by the Parent Company.

The employees of the Group in respect of gratuity are members of Defined Benefit Gratuity Fund maintained and operated by the Parent Company. Accordingly, the above information is based upon the plan assets of Engro Corporation Limited Gratuity Fund.
38.2.13 The expected return on plan assets was determined by considering the expected returns available on the assets underlying the current investment policy. Expected yields on fixed income investments are based on gross redemption yields as at the reporting date.

38.2.14 Expected future cost / (reversal) for the year ending December 31, 2026 is as follows:

- Gratuity Fund - NMPT - Gratuity Fund - MPT - Pension Fund	Rupees 45,749
	(2,211)
	1,298

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(Amounts in thousand)

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|||||
|---|---|---|---|
|cash generated from operations|2025|.......Rupees.......|2024|
|Profit before taxation|40,031,049|45,155,920|
|Adjustment for non-cash charges and other items:|
|Depreciation (note 4.1)|5,007,394|4,218,498|
|Amortisation of intangibles (note 5.3)|247,618|240,685|
|Amortisation of deferred income|(3,865)|(3,865)|
|(Gain) / Loss on disposal of operating assets|(1,069,601)|191,072|
|Provision for retirement and other service benefits|438,131|412,119|
|Income on deposits / other financial assets (note 29)|(801,432)|(2,498,037)|
|Finance cost|6,170,739|4,155,537|
|Provision against stock-in-trade (note 9.1)|-|192,441|
|Provision for surplus and slow moving stores and spares (note 8.1)|304,923|309,397|
|Reversal of provision against stores and spares and loose tools (note 8.1)|(55,668)|(118,540)|
|Stock-in-trade directly written off (note 9.2)|86,207|233,993|
|Reversal for impairment against trade debts (note 10.2)|(39,088)|(31,020)|
|Stores and spares directly written off (note 8.2)|3,811|968|
|Gain on subsidy receivable from the GoP (note 11.3)|(624,715)|(1,203,088)|
|Working capital changes (note 39.1)|(3,973,321)|(19,674,320)|
|45,722,182|31,581,760|

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39. cash generated from operations

39.1 Working capital changes

(Increase) / decrease in current assets

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||||
|---|---|---|
|(Increase) / decrease in current assets|
|- Stores, spares and loose tools|(1,164,609)|298,171|
|- Stock-in-trade|951,340|(11,799,738)|
|- Trade debts|(8,553,577)|(5,309,716)|
|- Loans, advances, deposits and prepayments|925,579|(601,801)|
|- Other receivables - net|4,792,600|5,260,926|
|(3,048,667)|(12,152,158)|
|Decrease in current liabilities|
|- Trade and other Payables|(924,654)|(7,522,162)|
|(3,973,321)|(19,674,320)|
|cash and cash equivalents|
|Cash and bank balances (note 14)|8,042,747|4,308,149|
|Short-term investments|1,200,000|1,200,000|
|Short-term borrowings|(3,022,723)|(7,951,850)|
|6,220,024|(2,443,701)|

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40. cash and cash equivalents

(Amounts in thousand)

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||||||
|---|---|---|---|---|
|41.|financial instruments by category|2025|.......Rupees.......|2024|
|Financial assets at amortised cost|
|Long-term investments|4,348,915|4,268,249|
|Loans, advances and deposits|2,190,973|2,457,397|
|Trade debts|16,845,846|8,253,231|
|Other receivables|3,770,429|6,317,399|
|Accrued income|147,159|272,080|
|Short-term investments|1,200,000|1,200,000|
|Cash and bank balances|8,042,747|4,308,149|
|36,546,069|27,076,505|
|Financial assets at fair value through profit or loss|
|Short-term investments|14,812,850|2,490,852|
|Financial liabilities at amortised cost|
|Borrowings|43,907,545|21,535,721|
|Government grant|514,355|717,092|
|Trade and other payables|63,487,583|60,846,566|
|Accrued interest / mark-up|1,434,310|1,209,388|
|Short-term borrowings|23,022,723|12,451,849|
|132,366,516|96,760,616|

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42. financial risk management

42.1 financial risk factors

The Group's activities expose it to a variety of financial risks: market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk. The Group's overall risk management program focuses on having cost efficient funding as well as to manage financial risk to minimise earnings volatility and provide maximum return to shareholders.

Risk management is carried out by the Group's Finance and Planning department under policies approved by the Management Committee.

a) Market risk

i) Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

rooted in 365 character driven leadership

rooted in character 366 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

This exists due to the Group's exposure resulting from outstanding import payments and foreign currency bank accounts. A foreign exchange risk management policy has been developed and approved by the management. The policy allows the Group to take currency exposure for limited periods within predefined limits while open exposures are rigorously monitored. The Group ensures to the extent possible that it has options available to manage exposure, either through forward contracts, options or prepayments, etc. subject to the prevailing foreign exchange regulations.

As at December 31, 2025, if exchange rates had been 1% higher / lower with all other variables held constant, post tax consolidated profit for the year would have been lower / higher by Rs. 6,079 (2024: Rs. 581)

ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Group's interest rate risk arises from bank deposits, long-term and short term borrowings, and long term and short-term investments. Borrowing are benchmarked to variable rates which expose the Group to cash flow interest rate risk.

The Group analyses its interest rate exposure on a regular basis by monitoring interest rate trends to determine whether they should enter into hedging alternatives.

As at December 31, 2025, if interest rates had been 1% higher / lower with all other variables held constant, post tax consolidated profit for the year would have been lower / higher by Rs. 373,304 (2024: Rs. 168,968).

iii) Other price risk

Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk) whether those changes are caused by factors specific to the individual financial instruments or its issuer, or factors effecting all similar financial instruments traded in the market. The Group is exposed to price risk on its investments in units of Mutual Funds.

As at December 31, 2025, if net asset value had been 1% higher / lower with all other variables held constant, post tax consolidated profit for the year would have been higher / lower by Rs. 96,296 (2024: Rs. 17,621).

b) Credit risk

Credit risk represents the risk of financial loss being caused if counter party fails to discharge an obligation.

Credit risk arises from deposits with banks and financial institutions, trade debts, loans, advances, deposits, bank guarantees and other receivables. The credit risk on liquid funds is limited because the counter parties are banks with a reasonably high credit rating which in turn are deposited in banks and government securities. The Group having a minimum short term credit rating of A1 respectively. However, the Group maintains operational balances with certain banks of lower rating for the purpose of effective collection of bank guarantees and to cater to loan disbursements.

The Group is exposed to a concentration of credit risk on its trade debts by virtue of all its customers being agri-based businesses in Pakistan. However, this risk is mitigated by applying individual credit limits and by securing the majority of trade debts against bank guarantees.

The credit risk arising on account of acceptance of these bank guarantees is managed by ensuring that the bank guarantees are issued by banks of reasonably high credit ratings as approved by the Board of Directors.

The Group monitors the credit quality of its financial assets with reference to historical performance of such assets and available external credit ratings. The carrying values of financial assets which are neither past due nor impaired are as under:

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||||
|---|---|---|
|2025|.......Rupees.......|2024|
|Long-term investments|4,348,915|4,268,249|
|Loans, advances and deposits|2,190,973|2,457,397|
|Trade debts|16,845,896|8,253,321|
|Other receivables|3,770,429|6,317,399|
|Accrued income|147,159|272,080|
|Short-term investments|1,200,000|1,200,000|
|Bank balances|8,042,547|4,305,036|
|36,545,919|27,073,482|

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The credit quality of receivables can be assessed with reference to their historical performance with no or negligible defaults in recent history. Investments in Pakistan Investment Bonds are government guaranteed. The credit quality of the Group's bank balances and short term investments can be assessed with reference to recent external credit ratings as follows:

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|||||
|---|---|---|---|
|Rating|Rating|
|agency|Short term|Long term|
|Conventional|
|- Allied Bank Limited|PACRA|A1+|AAA|
|- Askari Bank Limited|PACRA|A1+|AA+|
|- Bank Alfalah Limited|PACRA|A1+|AAA|
|- Bank Al Habib Limited|PACRA|A1+|AAA|
|- The Bank of Punjab|PACRA|A1+|AA+|
|- Citibank N.A.|MOODY'S|P1|Aa3|
|- Habib Bank Limited|JCR-VIS|A1+|AAA|
|- Habib Metropolitan Bank Limited|PACRA|A1+|AA+|
|- Industrial and Commercial Bank of China|FITCH|F1+|A|
|- JS Bank Limited|PACRA|A1+|AA|
|- MCB Bank Limited|PACRA|A1+|AAA|
|- National Bank of Pakistan|PACRA|A1+|AAA|
|- Samba Bank Limited|PACRA|A1+|AA|
|- Soneri Bank Limited|PACRA|A1+|AA-|
|- Standard Chartered Bank (Pakistan) Limited|PACRA|A1+|AAA|
|- United Bank Limited|JCR-VIS|A1+|AAA|
|Islamic|
|- BankIslami Pakistan Limited|PACRA|A1|AA-|
|- Al Baraka Bank (Pakistan) Limited|JCR-VIS|A1|AA-|
|- Faysal Bank Limited|JCR-VIS|A1+|AA|

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rooted in 367 character driven leadership

rooted in character 368 driven leadership

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engro fetilizers limited

annual report 2025

(Amounts in thousand)

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|||||
|---|---|---|---|
|Rating|Rating|
|agency|Short term|Long term|
|- Habib Bank Limited|JCR-VIS|A1+|AAA|
|- MCB Islamic Bank Limited|PACRA|A1|A+|
|- Meezan Bank Limited|JCR-VIS|A1+|AAA|
|- Bank Makramah Limied|JCR-VIS|-|B|

----- End of picture text -----

c) Liquidity risk

Liquidity risk represents the risk that the Group will encounter difficulties in meeting obligations associated with financial liabilities.

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities. Due to dynamic nature of the business, the Group maintains flexibility in funding by maintaining committed credit lines available.

The Group's liquidity management involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring statement of financial position liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

The table below analyses the Group's financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to contractual maturity dates. The amounts disclosed in the table are the contractual undiscounted cash flows.

(Amounts in thousand)

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||||
|---|---|---|
|2025|.......Rupees.......|2024|
|Borrowings|43,907,545|21,535,721|
|Total Equity|44,747,238|47,458,544|
|Total Capital|88,654,783|68,994,265|
|Debt to Equity Ratio %|50:50|31:69|

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The Group finances its operations through equity, borrowings and management of working capital with a view to maintaining an appropriate mix between various sources of finance to minimise risk.

42.3 Fair value estimation

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an exit price) regardless of whether that price is directly observable or estimated using another valuation technique.

As at December 31, 2025, all financial assets and financial liabilities, except for investment in units of mutual funds, are carried at amortised cost. Mutual funds are measured at fair value using the fair value measurement method in accordance with IFRS 13.

The carrying value of all financial assets and liabilities reflected in the consolidated financial statements approximate their fair values. The Group classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);

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||||||||
|---|---|---|---|---|---|---|
|2025|2024|
|Maturity|Maturity|Total|Maturity|Maturity|Total|
|upto one|after|upto one|after|
|year|one year|year|one year|
|-------------------------------------------------Rupees-------------------------------------------------|
|Financial liabilities|
|Borrowings|17,830,037|32,375,929|50,205,966|4,695,766|23,798,149|28,493,915|
|Trade and other payables|63,487,583|-|63,487,583|60,846,566|-|60,846,566|
|Accrued interest / mark-up|1,434,310|-|1,434,310|1,209,388|-|1,209,388|
|Short-term borrowings|23,022,723|-|23,022,723|12,451,850|-|12,451,850|
|105,774,653|32,375,929|138,150,582|79,203,570|23,798,149|103,001,719|

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42.2 Capital risk management

The Group's objective when managing capital are to safeguard the Group's ability to continue as a going concern in order to provide returns for shareholders and benefit for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The Group manages its capital structure and makes adjustments to it in the light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust dividend payment to shareholders or issue new shares. The gearing ratio of the Group is calculated as borrowings divided by total capital. Total capital is calculated as equity as shown in the statement of financial position plus borrowings.

Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (level 2); and
Inputs for the asset or liability that are not based on observable market data (level 3).

The table below analyses financial instruments carried at fair value by valuation method.

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||||||
|---|---|---|---|---|
|Level 1|Level 2|Level 3|Level 4|
|-------------------------Rupees-------------------------|
|As at December 31, 2025|
|Fair value through profit or loss|-|14,812,850|-|14,812,850|
|As at December 31, 2024|
|Fair value through profit or loss|-|2,490,852|-|2,490,852|

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Represents investment in units of mutual funds that are measured at fair value using the fund's respective net asset value.

There were no transfers between the levels of hierarchy during the year.

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rooted in character 370 driven leadership

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engro fetilizers limited

annual report 2025

(Amounts in thousand)

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|||||||
|---|---|---|---|---|---|
|43.|transactions with related parties|Name of Related parties|Direct shareholding|Relationship|
|43.1|Following are the names of associated companies and undertakings and other related parties with whom|Ahsan Zafar Syed|N/A|Director|
|the Group had entered into transactions or had agreements and / or arrangements in place during the|Ali Rathore|N/A|Chief Executive Officer|
|year:|Javed Akbar|N/A|Ex - Director|
|Asim Murtaza Khan|N/A|Ex - Director|
|Name of Related parties|Direct shareholding|Relationship|Danish Zuberi|N/A|Ex - Director|
|Ahmad Shakoor|N/A|Director|
|Engro Corporation Limited|56.27%|Holding Company|Farooq Barkat Ali|N/A|Director|
|EFERT Agritrade (Private) Limited|100%|Subsidiary Company|Asad Said Jafar|N/A|Director|
|Engro Eximp FZE|N/A|Subsidiary of Holding Company|Mohammad Younus Dagha|N/A|Director|
|Engro Elengy Terminal (Private) Limited|N/A|Associate of Holding Company|Rizwan Khalil Sheikh|N/A|Director|
|Elengy Terminal Pakistan Limited|N/A|Subsidiary of Holding Company|Sadia Khan|N/A|Director|
|Engro Energy Limited|N/A|Subsidiary of Holding Company|Aneeq Ahmad|N/A|Key Management Personnel|
|Engro Polymer and Chemicals Limited|N/A|Subsidiary of Holding Company|Nazia Ali|N/A|Key Management Personnel|
|Engro Peroxide (Private) Limited|N/A|Subsidiary of Holding Company|Farrukh Saeed Khan|N/A|Key Management Personnel|
|Think PVC (Private) Limited|N/A|Subsidiary of Holding Company|Muhammad Majid Latif|N/A|Key Management Personnel|
|Engro LNG FZE|N/A|Subsidiary of Holding Company|Khawaja Bilal Mustafa|N/A|Key Management Personnel|
|Engro Powergen Thar (Private) Limited|N/A|Subsidiary of Holding Company|Atif Muhammad Ali|N/A|Key Management Personnel|
|Engro Enfrashare (Private) Limited|N/A|Subsidiary of Holding Company|Muhammad Imran Khalil|N/A|Key Management Personnel|
|Engro Connect (Private) Limited|N/A|Subsidiary of Holding Company|Kalim Uddin A. Khan|N/A|Key Management Personnel|
|Engro Technical Solutions (Private) Limited|N/A|Subsidiary of Holding Company|FrieslandCampina Engro Pakistan Limited|
|FrieslandCampina Engro Pakistan Limited|N/A|Associate of Holding Company|Employees Gratuity Fund|N/A|Post Employment Benefits|
|Engro Energy Services Limited|N/A|Associate of Holding Company|Engro Corporation Limited DC Pension Fund|N/A|Post Employment Benefits|
|Engro Foundation|N/A|Associate of Holding Company|Engro Corporation Limited MPT Gratuity Fund|N/A|Post Employment Benefits|
|Engro Vopak Terminal Limited|N/A|Associate of Holding Company|Engro Corporation Limited NMPT Gratuity Fund|N/A|Post Employment Benefits|
|Sindh Engro Coal Mining Company Limited|N/A|Associate of Holding Company|Engro Fertilizers Limited NMPT Gratuity Fund|N/A|Post Employment Benefits|
|Unilever Pakistan Foods Limited|N/A|Common Directorship|Engro Corporation Limited DB Pension Fund|N/A|Post Employment Benefits|
|Engro Power International Holding BV|N/A|Common Directorship|Engro Corporation Limited DC Gratuity Fund|N/A|Post Employment Benefits|
|Engro Power Investments International BV|N/A|Common Directorship|Engro Corporation Limited Provident Fund|N/A|Post Employment Benefits|
|Engro Power Services Holding BV|N/A|Common Directorship|
|Engro Power Services Limited (Nigeria)|N/A|Common Directorship|
|Karachi Education Initiative|N/A|Common Directorship|43.2|Following are the names of related parties incorporated outside Pakistan with whom the Group had|
|EngroTech Ventures-FZCO|N/A|Common Directorship|entered into transactions or had agreements and arrangements in place during the year:|
|Engro Engineering and consulting LLC (SPC) Abu Dhabi|N/A|Common Directorship|
|Dawood Foundation|N/A|Common Directorship|Name of Related Party|Country of incorporation|Registered Address|
|Pakistan Oxygen Limited|N/A|Common Directorship|Engro Eximp FZE|United Arab Emirates|BCW JAFZA 18 & 19, Office # 110,|
|Shabbir Tiles & Ceramics Limited|N/A|Common Directorship|United Arab Emirates|
|National Clearing Company of Pakistan Limited|N/A|Common Directorship|
|Pakistan Broadcasting Corporation|N/A|Common Directorship|
|Thar Power Company Limited|N/A|Common Directorship|

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Registered Address BCW JAFZA 18 & 19, Office # 110, United Arab Emirates

rooted in 371 character driven leadership

rooted in character 372 driven leadership

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engro fetilizers limited

annual report 2025

(Amounts in thousand)

43.3 Details of transactions with related parties during the year, other than those which have been disclosed elsewhere in these consolidated financial statements, are as follows:

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||||
|---|---|---|
|2025|.......Rupees.......|2024|
|Parent Company|
|Dividend paid|14,274,929|16,153,210|
|Mark-up paid / payable on sub-ordinated loan|227,273|183,393|
|Mark-up received on working capital loan|929|-|
|Reimbursements made:|
|- by the Parent Company|528,151|414,611|
|- to the Parent Company|3,034,969|2,819,513|
|Royalty|3,315,473|3,016,514|
|Use of assets|1,312,087|1,162,726|
|Disbursement of loan to Parent Company|2,690,000|11,500,000|
|Repayment received against loan to Parent Company|2,690,000|11,500,000|
|-|
|Receipt of loan from Parent Company|33,113,000|
|-|
|Repayment of loan to Parent Company|33,113,000|
|Associated companies|
|Purchases and services received|40,687,247|69,893,694|
|Services provided|1,321|19,104|
|Reimbursements made:|
|- by the Group|110,370|148,800|
|- to the Group|265,101|189,526|
|Donations|402,895|396,000|
|Use of assets|186,259|417,147|
|Purchase of taxable loss|2,044,211|1,649,933|
|Contribution to staff retirement benefits|
|Pension fund|2,487|3,120|
|Gratuity fund|203,716|184,613|
|Provident fund|249,860|230,934|
|Dividend paid to staff retirement benefits|
|Pension fund|-|112|
|Gratuity fund|3,680|3,207|
|Provident fund|4,617|4,894|
|Others|
|Remuneration of key management personnel|375,619|344,160|
|Directors' fees|7,070|14,619|

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(Amounts in thousand)

44. operating segment results

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||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
|Urea|Phosphates|Specialty Fertilizers Business|Others|Total|
|2025|2024|2025|2024|2025|2024|2025|2024|2025|2024|
|----------------------------------------------------------------------------------Rupees----------------------------------------------------------------------------------|
|Sales|177,808,858|158,482,970|49,790,565|81,497,890|25,201,414|33,580,637|-|301,658|252,800,837 273,863,155|
|Intersegment sales|10,598,500|17,610,536|-|-|-|-|-|-|10,598,500|17,610,536|
|Sales tax|(9,615,518)|(7,739,978)|(4,525,722)|(7,410,215)|(1,383,764)|(1,744,634)|-|(46,668)|(15,525,004)|(16,941,495)|
|178,791,840|168,353,528|45,264,843|74,087,675|23,817,650|31,836,003|-|254,990|247,874,333|274,532,196|
|Profit / (loss) before tax|38,766,996|37,446,168|807,703|6,284,000|456,350|1,860,100|-|(434,348)|40,031,049|45,155,920|
|Depreciation & Amortisation|4,431,757|3,680,415|-|-|134,440|96,766|688,815|682,002|5,255,012|4,459,183|
|Capital Expenditure|10,569,478|7,084,682|-|-|365,566|143,068|878,107|1,290,020|11,813,151|8,517,770|
|Urea|Phosphates|Specialty Fertilizers Business|Others|Total|
|2025|2024|2025|2024|2025|2024|2025|2024|2025|2024|
|----------------------------------------------------------------------------------Rupees----------------------------------------------------------------------------------|
|Segment assets|128,405,343|117,507,687|21,658,332|21,729,692|12,729,768|10,213,321|8,303,894|8,612,080|170,614,404|158,062,780|
|Unallocated assets|-|-|-|-|-|-|-|-|28,551,671|12,539,330|
|Total assets|128,405,343|117,507,687|21,658,332|21,729,692|12,729,768|10,213,321|8,303,894|8,612,080|199,166,075|170,602,110|
|44.1|Reconciliation of reportable segment net sales|2025|.......Rupees.......|2024|
|Net Sales|
|Total net sales for reportable segment|247,874,333|274,532,196|
|Elimination of intersegment net sales|(10,598,500)|(17,610,536)|
|Elimination of net sales to subsidiary|(145,047)|(246,497)|
|Total net sales|237,130,786|256,675,163|
|44.2|Reconciliation of reportable segment total assets|
|Total assets for reportable segments|170,614,404|158,062,780|
|Add: Unallocated assets|
|- Accrued income|147,159|272,080|
|- Short-term investments|16,012,850|3,690,852|
|- Long-term investments|4,348,915|4,268,249|
|- Cash and bank balances|8,042,747|4,308,149|
|28,551,671|12,539,330|
|Total assets|199,166,075|170,602,110|

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rooted in 373 character driven leadership

rooted in character 374 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

45. production capacity

Urea plant I & II NPK plant	Designed annual capacity	Metric Tons 2025 2024 Remarks Actual production Production planned as per market demand 2,289,705 2,147,025 76,891 105,296
	Metric Tons
	2025 2024 2,275,000 2,275,000 100,000 100,000

46. number of employees

Management employees Non-management employees	2025 2024 Number of employees as at December 31 716 707 469 462 1,185 1,169	Average number of employees during the year
		2025 2024 710 717 474 467 1,184 1,184

47. contributory retirement funds

The employees of the Group participate in the Retirement Fund maintained by the Parent Company. The investments out of the retirement fund have been made in accordance with the provisions of Section 218 of the Act and the conditions specified there-under.

48. seasonality

The Group's fertilizer business is subject to seasonal fluctuations as a result of two different farming seasons viz, Rabi (from October to March) and Kharif (from April to September). On an average, fertilizer sales are more tilted towards Rabi season. The Group manages seasonality in the business through appropriate inventory management.

sharing percentages in PEF of the Holding Company, Fauji and FATIMA are 33.9%, 47.7% and 18.4%, respectively. The Holding Company has continued to recognise its share of jointly held asset in these consolidated financial statements."

50. non-adjusting event after the reporting date

The Board of Directors of the Holding Company in its meeting held on 11 February, 2026 has proposed a final cash dividend of Rs. 4.00 per share for the year ended December 31, 2025 amounting to Rs. 5,341,198 for approval of the members at the Annual General Meeting to be held on 25 March, 2026.

51. corresponding figures

Corresponding figures have been rearranged and reclassified, wherever considered necessary, for the purposes of better presentation and / or to comply with the requirements of accounting and reporting standards applicable on the Group.

Corresponding figures and balances have been rearranged and reclassified for better presentation, wherever necessary. The reclassification made during the year is as follows:

Salaries, wages and staff welfare Salaries, wages and staff welfare Description	Administrative expenses Cost of Sales 360,798 Administrative expenses Selling and distribution expenses 106,207 �� From To For the year ended December 31,2024 (Rupees)

52. date of authorisation for issue

These consolidated financial statements were authorised for issue on February 11, 2026 by the Board of Directors of the Holding Company.

49. interest in joint arrangements

In 2022, the Holding Company, Fauji Fertilizer Company Limited (Fauji) and Fatima Fertilizer Company Limited (FATIMA) (collectively the Fertilizer Manufacturers) entered into a Framework Agreement dated November 30, 2022 (the Agreement) for Gas Pressure Enhancement Facilities (PEF) project. Under the Agreement, the Fertilizer Manufacturers have decided to jointly develop and install pressure enhancement facilities at Mari Energies Limited's (MEL's) (formerly Mari Petroleum Company Limited) delivery node to sustain the current level of pressure of gas supply from HRL reservoir of MEL.

All decisions with respect to the development and operations of PEF would be made only with unanimous consent of the Fertilizer Manufacturers. Accordingly, PEF arrangement would be classified as a 'Joint Arrangement' in accordance with IFRS 11 - Joint Arrangements. Further, PEF would not be established through a separate legal entity and consists of an asset i.e. PEF facility which will be jointly owned and operated by the Fertilizer Manufacturers, hence, the joint arrangement for establishment and operations of PEF has been classified as a 'Joint Operation' in these consolidated financial statements. Current cost

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Ahsan Zafar Syed Chief Executive Officer Chairman

engro fetilizers limited

rooted in 375 character driven leadership

rooted in character 376 driven leadership

engro fertilizers limited

annual report 2025

standalone financial statements for the year ended december 31, 2025

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INDEPENDENT AUDITOR’S REPORT

To the members of Engro Fertilizers Limited Report on the Audit of the Financial Statements

Opinion

We have audited the annexed financial statements of Engro Fertilizers Limited (the Company), which comprise the statement of financial position as at December 31, 2025, and the statement of profit or loss, the statement of comprehensive income, the statement of changes in equity, the statement of cash flows for the year then ended, and notes to the financial statements, including material accounting policy information and other explanatory information, and we state that we have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of the audit.

In our opinion and to the best of our information and according to the explanations given to us, the statement of financial position, statement of profit or loss, the statement of comprehensive income, the statement of changes in equity and the statement of cash flows together with the notes forming part thereof conform with the accounting and reporting standards as applicable in Pakistan and give the information required by the Companies Act, 2017 (XIX of 2017), in the manner so required and respectively give a true and fair view of the state of the Company's affairs as at December 31, 2025 and of the profit and other comprehensive income, the changes in equity and its cash flows for the year then ended.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants as adopted by the Institute of Chartered Accountants of Pakistan (the Code) and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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Following are the key audit matters:

Key audit matters
S. No

Revenue recognition
(Refer notes 2.22 and 27 to the financial
statements)
Company’s net sales comprise of revenu
the sale of urea and other fertilizer produ
adjusted by trade discounts and sales ta
duties. Revenue from the sale of goods i
recognised in the statement of profit or l
control of the product is transferred i.e. w
product is dispatched / delivered to the c
There is a presumed risk of revenue bein
overstated and recorded in incorrect peri
based on our risk assessment. Accordin
have considered that there is a high level
of material misstatement of financial sta
relating to revenue recognition requiring
significant audit efforts to address the
aforementioned risks. Therefore, this has
considered as a key audit matter.

How the matter was addressed in our audit Our audit procedures amongst others included the following:

Company’s net sales comprise of revenue from - obtained understanding and evaluated the the sale of urea and other fertilizer products, accounting policies and the Company’s adjusted by trade discounts and sales taxes and procedures with respect to revenue duties. Revenue from the sale of goods is recognition; recognised in the statement of profit or loss when control of the product is transferred i.e. when the - examined contracts with customers, on a product is dispatched / delivered to the customer. sample basis, to obtain an understanding of Percentage the terms particularly relating to timing of
There is a presumed risk of revenue being transfer of control of the products; overstated and recorded in incorrect period, based on our risk assessment. Accordingly, we - tested revenue transactions on a sample have considered that there is a high level of risk basis throughout the year by inspecting of material misstatement of financial statements underlying documentation including sales relating to revenue recognition requiring invoices and customer acknowledgement; significant audit efforts to address the aforementioned risks. Therefore, this has been - tested revenue transactions on a sample considered as a key audit matter. basis recorded before and after the reporting date with underlying documentation i.e. customer acknowledgement to assess whether revenue was recognised in the correct period;
- obtained understanding of the types and process of discounts offered to customers and tested on a sample basis discounts provided to customers by examining supporting documentation including approvals of the discounts; and
- assessed the adequacy of the related disclosures made in the financial statements with respect to the applicable accounting and reporting standards.

rooted in 379 character driven leadership

rooted in character 380 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

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Key audit matters How the matter was addressed in our audit S. No	Key audit matters How the matter was addressed in our audit S. No	Key audit matters How the matter was addressed in our audit S. No
2.	Income tax and Sales tax provisions and contingencies (Refer notes 2.18, 2.20, 3.2, 3.5, 26.2, 26.3, 26.7 to 26.10 and 35 to the financial statements) The Company has recognised provisions and has disclosed contingencies in respect of certain income tax and sales tax matters, which are pending adjudication before various appellate and legal forums. Provisions and contingencies requires management of the Company to make judgments and estimates in relation to the interpretation of laws, statutory rules, regulations and the probability of outcome and financial impact, if any, on the Company for recognition and measurement of any provision and disclosure in respect of such provisions and contingencies. Due to inherent uncertainties associated with the outcome of the matters, legal forums at which these are currently pending and use of significant judgements and estimates to assess the same including related financial impacts, which may change over time as new facts emerge and the matters progress, we have considered income tax and sales tax provisions and contingencies as a key audit matter.	Percentage Our audit procedures amongst others included the following: - obtained and examined details of the documentation relating to pending tax matters and inquired the same with the Company's management; - circularised confirmations to the Company's external legal and tax advisors for their views on matters being handled by them; - checked correspondence of the Company with the relevant authorities including judgements or orders passed by the competent authorities in relation to the issues involved; - involved internal tax professionals to assess management's conclusions on complex contingent and uncertain tax matters; - checked the mathematical accuracy of the calculations underlying the provisions; and - assessed the adequacy of the related disclosures made in the financial statements with respect to the applicable accounting and reporting standards.

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Information Other than the Financial Statements and Consolidated Financial Statements and Auditor’s Reports Thereon

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Board of Directors for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the accounting and reporting standards as applicable in Pakistan and the requirements of Companies Act, 2017 (XIX of 2017) and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Board of directors are responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs as applicable in Pakistan will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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rooted in character 382 driven leadership

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engro fetilizers limited

annual report 2025

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As part of an audit in accordance with ISAs as applicable in Pakistan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with the board of directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the board of directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

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From the matters communicated with the board of directors, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

Based on our audit, we further report that in our opinion:

(a) proper books of account have been kept by the Company as required by the Companies Act, 2017 (XIX of 2017);
(b) the statement of financial position, the statement of profit or loss, the statement of comprehensive income, the statement of changes in equity and the statement of cash flows together with the notes thereon have been drawn up in conformity with the Companies Act, 2017 (XIX of 2017) and are in agreement with the books of account and returns;
(c) investments made, expenditure incurred and guarantees extended during the year were for the purpose of the Company’s business; and
(d) zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980), was deducted by the Company and deposited in the Central Zakat Fund established under section 7 of that Ordinance.

The engagement partner on the audit resulting in this independent auditor’s report is Azhar Hussain.

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A. F. Ferguson & Co. Chartered Accountants Karachi

Date: March 4, 2026

UDIN: AR202510290XMSKCL6IJ

rooted in 383 character driven leadership

rooted in character 384 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

statement of financial position as at december 31, 2025

ASSETS Non-current assets Property, plant and equipment 4 Intangible assets 5 Investment in subsidiary 6 Deferred taxation 21 Long-term investments 7 Long-term loans, advances and deposits 8 Current assets Stores, spares and loose tools 9 Stock-in-trade 10 Trade debts 11 Other receivables 12 Loans, advances, deposits and prepayments 13 Working capital loan to subsidiary 14 Taxation - net Accrued income Short-term investments 15 Cash and bank balances 16 Total assets Note (Amounts in thousand)	2025....Rupees....2024	2025....Rupees....2024

	92,391,260 4,779,969 100 37,736 3,597,740 26,738	83,137,431 5,007,551 100 - 3,517,074 197,921
	100,833,543	91,860,077
	9,151,070 11,085,159 14,200,239 6,695,551 2,381,086 20,998,123 10,635,995 874,728 15,062,850 7,949,297	8,239,527 12,204,931 5,687,349 10,500,236 3,417,141 11,902,310 11,344,778 764,926 2,739,411 4,261,445
	99,034,098	71,062,054
	199,867,641	162,922,131

(Amounts in thousand) EQUITY & LIABILITIES Equity Share capital 17 Reserves Share premium 18 Reserve on amalgamation 18 Remeasurement of post employment benefits 18 Unappropriated profit 18 TOTAL EQUITY Liabilities Non-current liabilities Borrowings 19 Government grant 20 Deferred taxation 21 Deferred liabilities 22 Current liabilities Trade and other payables 23 Accrued interest / mark-up Current portion of: - borrowings 19 - government grant 20 - deferred liabilities 22 Provision for Gas Infrastructure Development Cess 24 Short-term borrowings 25 Unclaimed dividend TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES CONTINGENCIES AND COMMITMENTS 26 Note	2025....Rupees....2024	2025....Rupees....2024
	13,352,993	13,352,993
	3,384,904 (304,027) (38,559) 28,564,531	3,384,904 (304,027) (69,897) 30,164,684
	31,606,849	33,175,664
	44,959,842	46,528,657
	29,445,959 342,634 - 34,464	18,701,703 514,355 1,863,670 242,948
	29,823,057	21,322,676
	66,226,088 1,401,148 14,461,586 171,721 97,675 19,558,031 23,022,723 145,770	58,688,376 1,191,351 2,834,018 202,737 62,356 19,558,031 12,451,622 82,307
	125,084,742	95,070,798
	154,907,799	116,393,474
	199,867,641	162,922,131

The annexed notes from 1 to 54 form an integral part of these financial statements.

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Ahsan Zafar Syed Chief Executive Officer Chairman

rooted in 385 character driven leadership

rooted in character 386 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

statement of profit or loss for the year ended december 31, 2025

(Amounts in thousand except for earnings per share) Note Net sales 27 Cost of sales 28 Gross profit Selling and distribution expenses 29 Administrative expenses 30 Other income 31 Other operating expenses 32 Finance cost 33 Gain on subsidy receivable from GoP 34 Profit before taxation Taxation 35 Profit for the year Earnings per share - basic and diluted 36	2025....Rupees....2024 193,247,740 186,708,958 (124,898,590) (125,531,671) 68,349,150 61,177,287 (19,402,920) (15,949,909) (4,720,822) (4,290,874) 44,225,408 40,936,504 5,372,372 10,792,590 (4,434,043) (4,130,601) (6,050,229) (3,981,835) 624,715 1,203,088 39,738,223 44,819,746 (15,967,688) (14,612,984) 23,770,535 30,206,762 17.80 22.62	2025....Rupees....2024 193,247,740 186,708,958 (124,898,590) (125,531,671) 68,349,150 61,177,287 (19,402,920) (15,949,909) (4,720,822) (4,290,874) 44,225,408 40,936,504 5,372,372 10,792,590 (4,434,043) (4,130,601) (6,050,229) (3,981,835) 624,715 1,203,088 39,738,223 44,819,746 (15,967,688) (14,612,984) 23,770,535 30,206,762 17.80 22.62
	68,349,150 (19,402,920) (4,720,822)	61,177,287 (15,949,909) (4,290,874)
	44,225,408 5,372,372 (4,434,043) (6,050,229) 624,715	40,936,504 10,792,590 (4,130,601) (3,981,835) 1,203,088
	39,738,223 (15,967,688)	44,819,746 (14,612,984)
	23,770,535	30,206,762

	17.80	22.62

(Amounts in thousand except for earnings per share) Note

statement of comprehensive income for the year ended december 31, 2025

for the year ended december 31, 2025
Note (Amounts in thousand) Profit for the year Other comprehensive income: Items that will not be reclassified subsequently to profit or loss - Remeasurement of post employment benefits obligations 40.2.7 - Tax relating to remeasurement of post employment benefits obligations Total comprehensive income for the year	2025....Rupees....2024 23,770,535 30,206,762 51,373 7,356 (20,035) (2,869) 31,338 4,487 23,801,873 30,211,249
	23,801,873	30,211,249

The annexed notes from 1 to 54 form an integral part of these financial statements.

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Chief Executive Officer

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Ahsan Zafar Syed Chairman

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Chief Executive Officer

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Ahsan Zafar Syed Chairman

rooted in 387 character driven leadership

rooted in character driven leadership

388

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engro fetilizers limited

annual report 2025

statement of changes in equity for the year ended december 31, 2025

(Amounts in thousand) Balance as at January 1, 2025 Transactions with owners Dividends: - Final 2024: Rs. 8.00 per share - 1st interim 2025: Rs. 2.25 per share - 2nd interim 2025: Rs. 4.25 per share - 3rd interim 2025: Rs. 4.5 per share Total comprehensive income for the year ended December 31, 2025 Profit for the year Other comprehensive income Balance as at December 31, 2025 Balance as at January 1, 2024 Transactions with owners Dividends: - Final 2023: Rs. 8.00 per share - 1st interim 2024: Rs. 8.00 per share - 2nd interim 2024: Rs. 3.00 per share - 3rd interim 2024: Rs. 2.5 per share Total comprehensive income for the year ended December 31, 2024 Profit for the year Other comprehensive income Balance as at December 31, 2024	....................................................Rupees.................................................... Remeasurement of post empolyment benefits Total Share capital Share premium Reserve on amalgamation Unappropriated profit CAPITAL REVENUE RESERVES
	13,352,993 3,384,904 (304,027) (69,897) 30,164,684 46,528,657
	- - - - (10,682,395) (10,682,395) - - - - (3,004,424) (3,004,424) - - - - (5,675,022) (5,675,022) - - - - (6,008,847) (6,008,847)
	- - - - (25,370,688) (25,370,688)
	- - - - 23,770,535 23,770,535 - - - 31,338 - 31,338
	- - - 31,338 23,770,535 23,801,873
	13,352,993 3,384,904 (304,027) (38,559) 28,564,531 44,959,842
	13,352,993 3,384,904 (304,027) (74,384) 28,666,858 45,026,344
	- - - - (10,682,395) (10,682,395) - - - - (10,682,395) (10,682,395) - - - - (4,005,898) (4,005,898) - - - - (3,338,248) (3,338,248)
	- - - - (28,708,936) (28,708,936)
	- - - - 30,206,762 30,206,762 - - - 4,487 - 4,487
	- - - 4,487 30,206,762 30,211,249
	13,352,993 3,384,904 (304,027) (69,897) 30,164,684 46,528,657

The annexed notes from 1 to 54 form an integral part of these financial statements.

statement of cash flows

for the year ended december 31, 2025

(Amounts in thousand) Note Cash flows from operating activities Cash generated from operations 41 Retirement and other service benefits paid Taxes paid Long-term loans, advances and deposits Income on deposits / other financial assets received Net cash generated from / (utilised in) operating activities Cash flows from investing activities Purchases of property, plant and equipment and intangibles Proceeds from disposal of operating assets Disbursement of working capital loan to subsidiary Payment received against working capital loan to subsidiary Purchase of short-term and long-term investments Proceeds from sale of short-term and long-term investments Disbursement of loan to Holding Company Repayment received against loan to Holding Company Dividends received Net cash (utilised in) / generated from investing activities Cash flows from financing activities Proceeds from long-term borrowings 19.5 Proceeds from short-term borrowings Repayment of short-term borrowings Loan obtained from the Holding Company Repayment of long-term borrowings 19.5 Loan repaid to the Holding Company Finance cost paid Dividends paid Net cash generated from / (utilised in) financing activities Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year 42	2025....Rupees....2024	2025....Rupees....2024

	51,369,280 (545,358) (17,180,346) 171,183 2,107,138	31,421,441 (354,260) (34,835,723) 11,885 3,503,563
	35,921,897	(253,094)
	(14,444,067) 1,658,539 (60,516,029) 51,420,216 (35,722,328) 23,318,223 (2,690,000) 2,690,000 885,000	(9,227,357) 1,581,789 (100,316,602) 89,966,399 (88,294,969) 105,991,344 - - 5,750,000
	(33,400,446)	5,450,604
	24,000,000 20,500,000 (5,000,000) 33,113,000 (1,830,913) (33,113,000) (6,266,562) (25,307,225)	18,000,000 4,500,000 - 11,500,000 (2,686,717) (11,500,000) (2,889,968) (28,674,928)
	6,095,300	(11,751,613)
	8,616,751 (3,440,177)	(6,554,103) 3,113,926
	5,176,574	(3,440,177)

The annexed notes from 1 to 54 form an integral part of these financial statements.

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Muh ammad Imran K halil Ali Rathore Chief Financial Officer Chief Executive Officer

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Ahsan Zafar Syed Chairman

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Muh ammad Imran K halil Chief Financial Officer

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Ali Rathore Chief Executive Officer

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Ahsan Zafar Syed Chairman

rooted in 389 character driven leadership

rooted in character 390 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

notes to the financial statements

for the year ended december 31, 2025

(Amounts in thousand)

2.1.2 Statement of compliance

1. legal status and operations

1.1 Engro Fertilizers Limited (the Company) is a public company incorporated in Pakistan on June 29, 2009 under the repealed Companies Ordinance 1984, (now the Companies Act, 2017) as a wholly owned subsidiary of Engro Corporation Limited (the Holding Company), which is a wholly owned subsidiary of Engro Holdings Limited (the Ultimate Parent Company). The Company is listed on Pakistan Stock Exchange Limited (PSX). As at December 31, 2025, the Holding Company holds 56.27% share capital of the Company.

The Company is engaged in the manufacturing, purchasing and marketing of fertilizers. The business units of the Company include the following:

Geographical Location

Business Unit

Head / Registered Office

6th floor, The Harbour Front Building, Plot Number HC-3, Block 4, Scheme Number 5, Clifton, Karachi.

Engro Daharki Plant

District Ghotki, Sindh.

Engro Zarkhez Plant

EZ / 1 / P – 1 – II Eastern Zone, Port Qasim, Karachi.

Engro Markaz Bahawalpur Chowk Bloachan, Opposite 5 Star Petrol Pump, KLP Road. Engro Markaz Muridke Sheikupura-Muridke Road, Near Maryam Rice Mill. Engro Markaz Sahiwal Opposite Sohni Dharti Seeds Plant 134 / 9 - L, Multan Bypass. Engro Markaz Sargodha 85 Jhall Sillanwali Road, Near Sapphire Marriage Hall.

1.2 These financial statements are the unconsolidated financial statements of the Company. The consolidated financial statements of the Company and its wholly owned subsidiary are presented separately. Details of investment held by the Company in its subsidiary have been provided in note 6.

2. material accounting policy information

The material accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation
2.1.1 These financial statements have been prepared under the historical cost convention, except for re-measurement of certain financial assets at fair value and recognition of certain staff retirement benefits at present value. The financial statements are presented in Pakistan Rupees, which is the Company's functional and presentation currency. All financial information presented in Pakistan Rupees has been rounded off to the nearest thousands of rupees, unless otherwise stated.

These financial statements have been prepared in accordance with the accounting and reporting standards as applicable in Pakistan. The accounting and reporting standards applicable on the Company comprise of:

IFRS Accounting Standards issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017 (the Act); and
Provisions of, directives and notifcations issued under the Act.

2.1.3 The preparation of financial statements in conformity with the above requirements requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 3.
2.1.4 Initial application of standards, amendments and improvements to existing accounting and reporting standards
a) Standards, amendments to published standards and interpretations that are effective for the year and are relevant to the Company

There are certain amendments and improvements to approved accounting and reporting standards which became applicable to the Company for the financial year beginning on January 1, 2025, however these do not have any material impact on the Company's financial reporting and, therefore, have not been presented in these financial statements.

b) Standards or amendments to approved accounting and reporting standards that are not yet effective and have not been early adopted by the Company

The following standards or amendments are not effective for the accounting periods beginning on or after January 1, 2025 and have not been early adopted by the Company:

i) Amendment to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments (effective from January 1, 2026)

These amendments:

clarify the requirements for the timing of recognition and derecognition of some financial assets and liabilities, with a new exception for some financial liabilities settled through an electronic cash transfer system;
clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion;
add new disclosures for certain instruments with contractual terms that can change cash flows (such as some instruments with features linked to the achievement of environment, social and governance (ESG) targets); and
make updates to the disclosures for equity instruments designated at Fair Value through Other Comprehensive Income (FVOCI).

rooted in 391 character driven leadership

rooted in character 392 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

Depreciation is charged to the statement of profit or loss using the straight line method, except for catalyst whose depreciation is charged on the basis of number of production days, whereby the cost of an operating asset less its estimated residual value, if significant, is depreciated over its estimated useful life. Depreciation on additions is charged from the month following the month in which the asset is available for use and on disposals up to the preceding month of disposal.

ii) IFRS 18 - Presentation and Disclosure in Financial Statements (effective from January 1, 2027)

This is the new standard on presentation and disclosure in financial statements, with a focus on updates to the statement of profit or loss. The key new concepts introduced in IFRS 18 relate to:

Depreciation method, useful lives and residual values are reviewed and adjusted, if appropriate, at each reporting date.

2.3 Intangible assets

the structure of the statement of profit or loss;

a) Computer software and licenses

required disclosures in the financial statements for certain profit or loss performance measures that are reported outside an entity’s financial statements (that is, management-defined performance measures); and
enhanced principles on aggregation and disaggregation which apply to the primary financial statements and notes in general.

The Company's management at present is in the process of assessing the full impacts of these new standard and the amendments to IFRS 7 and IFRS 9, and is expecting to complete the assessment in due course.

Other than above there is a standard and certain amendments to accounting standards that are not yet effective and have not been early adopted by the Company for the financial year beginning on January 1, 2025. The standard and amendments are not expected to have any material impact in the Company's financial reporting and, therefore, have not been presented in these financial statements.

Following initial recognition, computer software and licenses are carried at cost less accumulated amortisation and impairment losses, if any.

Computer software and license cost treated as intangible assets are amortised from the date the software is put to use on a straight line basis over a period of 4 years, except for the Company's investment in its ERP i.e. OneSAP, which is being amortised over a period of 8 years.

2.2 Property, plant and equipment

b) Rights for future gas utilisation

These are stated at historical cost less accumulated depreciation and impairment losses, if any, except for freehold land and capital work in progress which are stated at cost less accumulated impairment losses, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items including borrowing costs. The cost of self constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to working condition for its intended use and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

Where major components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the statement of profit or loss during the financial year in which they are incurred.

Disposal of asset is recognised when significant risk and rewards incidental to ownership have been transferred to buyers. Gains and losses on disposals are determined by comparing the sale proceeds with the carrying amount and are recognised within ‘Other operating expenses / income’ in the statement of profit or loss in the financial year of disposal.

Rights for future gas utilisation represent premium paid to the Government of Pakistan (GoP) for allocation of 100 MMSCFD natural gas for a period of 20 years for the Company's Enven plant. The rights are being amortised from the date of commercial production on a straight line basis over the remaining allocation period.

c) Goodwill

Goodwill represents the difference between the consideration paid for acquiring interests in a business and the fair value of the Company's share of its net assets at the date of acquisition and is carried at cost less accumulated impairment, if any.

d) Right to use the brand

These are stated at cost less accumulated impairment, if any.

The carrying values of intangible assets are reviewed for impairment when events or changes in circumstances indicate that the carrying values may not be recoverable. If any such indication exists, assets or cash generating units are tested for impairment. Also, goodwill is tested for impairment at least once a year and other intangibles with indefinite useful life are tested for impairment at each reporting date. Where the carrying value exceeds the estimated recoverable amount, these are written down to their recoverable amount and the resulting impairment is charged to the statement of profit or loss.

rooted in 393 character driven leadership

rooted in character 394 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

The useful lives of intangible assets are reviewed at each reporting date to determine whether events and circumstances continue to support an indefinite useful life assessment for the asset.

2.4 Impairment of non-financial assets

2.7 Financial assets

2.7.1 Classification, initial recognition and measurement

Financial assets are classified into appropriate categories on initial recognition and are subsequently measured at amortised cost, at fair value through other comprehensive income or at fair value through profit or loss. The management determines the classification of financial assets into appropriate categories at initial recognition based on the Company’s business model for managing the financial assets and the contractual terms of the cash flows.

A financial asset is measured at amortised cost if both of the following conditions are met:

a) the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

b) the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met

a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

b) the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

2.5 Investment in subsidiary

Investment in subsidiary company is initially recognised at cost. This is subsequently measured at cost less accumulated impairment, if any. Where impairment loss is subsequently reversed, the carrying amount of the investment is increased to the revised amounts but limited to the extent of initial cost of investment. A reversal of impairment loss is recognised in the statement of profit or loss.

2.6 Joint arrangements

Joint arrangements are arrangements in which the Company has contractually agreed sharing of control, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control.

Joint arrangements are classified as joint operations or joint ventures depending upon the rights and obligations arising from the joint arrangement. The Company classifies a joint arrangement as joint operation when the Company has the rights to the assets, and obligations for the liabilities, relating to the arrangement. The Company classifies a joint arrangement as a joint venture when the Company has the rights to the net assets of the arrangement.

In respect of an interest in a joint operation, the Company recognises its assets, including its share of any assets held jointly; its liabilities, including its share of any liabilities incurred jointly; its revenue from the sale of its share of the output arising from the joint operation; its share of the revenue from the sale of the output by the joint operation; its expenses, including its share of any expenses incurred jointly.

A financial asset is measured at fair value through profit or loss if it is not measured at amortised cost or at fair value through other comprehensive income.

All financial assets are recognised at the time when the Company becomes a party to the contractual provisions of the instrument. Regular way purchases and sales of financial assets are recognised on trade date; the date on which the Company commits to purchase or sell the financial asset. Financial assets at amortised cost are initially recognised at fair value and are subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by impairment losses, if any. Interest income and impairment losses are recognised in profit or loss. Financial assets carried at fair value through other comprehensive income are initially and subsequently measured at fair value, with gains and losses arising from changes in fair value recognised in other comprehensive income. Financial assets carried at fair value through profit or loss are initially recorded at fair value and transaction costs are expensed in profit or loss. Realised and unrealised gains and losses arising from changes in the fair values of the financial assets held at fair value through profit or loss are included in profit or loss in the period in which they arise.

2.7.2 Derecognition

Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been transferred and the Company has transferred substantially all the risk and rewards of ownership. On derecognition of a financial asset, in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognised in profit or loss and other comprehensive income (as the case may be).

rooted in 395 character driven leadership

rooted in character 396 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

2.7.3 Impairment of financial assets

The Company assesses on a forward looking basis the Expected Credit Losses (ECL) associated with its debt instruments carried at amortised cost and at fair value through other comprehensive income. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade debts, the Company applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

The Company measures ECL of a financial instrument in a way that reflects:

a) an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;

b) the time value of money; and

c) reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions.

A default on a financial asset is considered when the counterparty fails to make contractual payments within 90 days of when they fall due.

Financial assets are written off when there are no reasonable expectation of recovery. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the balance due. Where recoveries are made, these are recognised in profit or loss.

2.10 Stores, spares and loose tools

These are valued at weighted average cost except for items in transit which are stated at invoice value plus other charges incurred thereon till the reporting date. For items which are slow moving and / or identified as surplus to the Company's requirements, adequate provision is made for any excess book value over estimated realisable value. The Company reviews the carrying amount of stores, spares and losse tools on a regular basis and provision is made for obsolescence.

2.11 Stock-in-trade

Net realisable value signifies the estimated selling price in the ordinary course of business less estimated costs of completion and costs necessary to be incurred in order to make the sales.

2.12 Trade debts and other receivables

These are recognised initially at fair value plus directly attributable transaction costs, if any and subsequently measured at amortised cost using effective interest rate method less provision for impairment, if any (as per note 2.7.3). The amount of provision is charged to the statement of profit or loss.

Trade debts and other receivables considered irrecoverable are written-off.

2.8 Financial liabilities

2.13 Cash and cash equivalents

2.9

The Company recognises a financial liability in its statement of financial position when, and only when, it becomes party to the contractual provisions of the instrument. At initial recognition, the Company measures a financial liability at its fair value minus, in the case of a financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial liability. Subsequently, financial liabilities are stated at amortised cost.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the statement of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle either on a net basis, or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

Cash and cash equivalents in the statement of cash flows include cash in hand, balances with banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts / short term borrowings which are payable on demand. Bank overdrafts are shown within short term borrowings in current liabilities on the statement of financial position.

2.14 Share capital

Borrowings

2.15

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the statement of profit or loss over the period of the borrowings using the effective interest rate method.

Borrowings are classified as current liabilities unless the Company has right to defer settlement of the liability for at least 12 months after the reporting date.

rooted in 397 character driven leadership

rooted in character 398 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

2.16 Borrowing cost

2.17 Trade and other payables

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method.

The Company contributes to:

defined contribution provident fund for its permanent employees. Monthly contributions are made both by the Company and employees to the fund at the rate of 10% of basic salary;
defined contribution pension fund for the benefit of those management employees who have not opted for defined contribution gratuity fund as explained in note 2.19.3. Monthly contributions are made by the Company to the fund at rates ranging from 12.5% to 13.75% of basic salary; and
defined contribution gratuity fund for the benefit of those management employees who have selected to opt out of defined benefit gratuity fund and defined contribution pension plans as explained in note 2.19.3. Monthly contributions are made by the Company to the fund at the rate of 8.33% of basic salary.

All of the aforementioned funds are managed by the Holding Company.

2.18 Income tax

2.19.2 Defined benefit plans

The tax expense for the year comprises of current and deferred tax. Tax expense is recognised in the statement of profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity, in which case, the tax expense is also recognised in other comprehensive income or directly in equity, respectively.

Current

Deferred

A deferred tax asset is recognised to the extent that is probable that future taxable profits will be available against which temporary differences can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

2.19 Employee benefits

2.19.1 Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contribution into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in the statement of profit or loss when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

A defined benefit plan is a post-employment benefit plan other than the defined contribution plan. The Company's net obligation in respect of defined benefit plans is calculated by estimating the amount of future benefit that employees have earned in return for their service in current and prior periods; that benefit is discounted to determine its present value. The calculation is performed annually by a qualified actuary using the Projected Unit Credit Method, related details of which are given in note 40.1 to the financial statements.

Remeasurements (actuarial gains / losses) in respect of defined benefit plans are recognised directly in equity through other comprehensive income.

The Company also contributes to:

defined benefit funded pension scheme for its management employees; and
defined benefit funded gratuity schemes for its management and non-management employees.

2.19.3 In June 2011, the Company gave a one time irrevocable option to selected members of MPT Employees' Defined Benefit Gratuity Fund and Defined Contribution Pension Fund to join a new MPT Employees' Defined Contribution Gratuity Fund (the Fund), a defined contribution plan. The present value, as at June 30, 2011, of the defined benefit obligation of those employees, who accepted this offer, were transferred to this Fund. Furthermore, from July 2011 onwards, the monthly contributions to Defined Contribution Pension Fund of such employees were discontinued.

2.19.4 Service incentive plan

The Company recognises annual provision under a service incentive plan for certain category of experienced employees to continue in the Company’s employment.

rooted in 390 character driven leadership

rooted in character 400 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

2.19.5 Employees' compensated absences

The Company accounts for compensated absences on the basis of unavailed leave balance of each employee at the end of the year.

2.20 Provisions and contingent liabilities

Provisions are recognised when the Company has a present (legal or constructive) obligation as a result of an event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made. Provisions are not recognised for future operating losses and are reviewed at each reporting date and adjusted to reflect the current best estimate.

Contingent liabilities are disclosed when the Company has possible obligation that arises from past event's and whose existence will be confirmed only by occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity, or a present obligation that arises from past event but is not recognised because it is not probable that an outflow of resources embodying economic benefit will be required to settle the obligation or, when amount of obligation cannot be measured with sufficient reliability.

2.24 Earnings per share

The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the year. Diluted EPS is determined by adjusting the profit or loss attributable to the ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.

2.25 Segment reporting

2.26 Dividend and appropriation to reserves

Dividend and appropriation to reserves are recognised in the financial statements in the period in which these are approved.

2.27 Contract liability

2.21 Foreign currency transactions and translation

These financial statements are presented in Pakistan Rupees, which is the Company’s functional and presentation currency. Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are recognised in the statement of profit or loss.

2.22 Revenue recognition

The Company manufactures and sells urea and other Fertilizers products in the market. Revenue from sale of goods is recognised when control of the products is transferred i.e. when the product is dispatched / delivered to the customer. The Company's payment terms include advances from customers and credit terms which range from 30 to 180 days from invoice date.

Revenue is measured at fair value of the consideration received or receivable (which is generally equal to invoice amount), excluding discounts, rebates and government levies.

2.23 Other income

Income on deposits and other financial assets is recognised on accrual basis.

Commission and sub-licensing income is recognised on accrual basis in accordance with the substance of the relevant agreement.

Dividend income on equity investments is recognised when the Company's right to receive the dividend is established.

Contract liability is an obligation of the Company to transfer goods and services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If the customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when payment is received. Contract liabilities are recognised as revenue when Company fulfils the performance obligation under the contract.

3. critical accounting estimates and judgements

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. Estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:

3.1 Property, plant and equipment

The Company reviews appropriateness of the rates of depreciation, useful lives and residual values used in the calculation of depreciation. Further, where applicable, an estimate of recoverable amount of assets is also made for possible impairment on an annual basis (note 4).

3.2 Income taxes

rooted in 401 character driven leadership

rooted in character 402 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

(Amounts in thousand)

4.1 Operating assets

3.3 Provision for retirement and other service benefits obligations

3.4 Impairment of goodwill and right to use the brand

3.5 Contingencies and provisions

3.6 Impairment of financial assets

Significant estimates are involved in the assessment of the ECL on the Company's financial assets except for cash and bank balances, long-term and short-term investments and working capital loan to Subsidiary, as the determination of ECL requires evaluating correlation between historical observed default rates and the projection of cashflows, forecast economic conditions and ECL. The amount of ECL is sensitive to changes in circumstances and of forecast economic conditions. In respect of ECL on subsidy receivable, since the Company is confident of full recovery therefore only time value of money was considered for the determination of loss allowance as at the reporting date (note 12.3.1).

3.7 Stock-in-trade

Deterimining the value of specific category of stock-in-trade i.e. Bulk Urea and Bulk Di-Ammonium Phosphate (DAP), involves the use of significant estimates and assumptions. As the weighing of these inventory items is not practicable, the reasonableness of the quantities on hand is assessed by obtaining measurements of stockpiles and converting these measurements into unit of volume by bulk density values (note 10).

property, plant and equipment

4.

2025 .......Rupees....... 2024

Operating assets at net book value (note 4.1) 74,507,920 73,994,621 Capital work in progress (CWIP) (note 4.5) 12,835,129 7,151,645 Major spare parts and stand-by equipment (note 4.1.1) 5,048,211 1,991,165 92,391,260 83,137,431

==> picture [483 x 41] intentionally omitted <==

194,914 - -	97,284 (46,400) -	3,414,532 (1,705,874) -	449,431 (212,039) -	113,854,746 (53,897,399) -	2,664,996 (1,284,311) -	3,271,405 (2,295,107) -	1,703,170 (1,189,740) -	3,854,412 (397,152) -	3,997,441 (1,524,415) (1,525,396)	133,502,331 (62,552,437) (1,525,396)
194,914	50,884	1,708,658	237,392	59,957,347	1,380,685	976,298	513,430	3,457,260	947,630	69,424,498
194,914 -	50,884 -	1,708,658 754,868	237,392 -	59,957,347 6,988,663	1,380,685 -	976,298 652,719	513,430 251,528	3,457,260 -	947,630 387,942	69,424,498 9,035,720

-	-	(11,055)	(5,354)	-	-	-	(38,512)	-	(287,327)	(342,248)
-	-	10,545	2,909	-	-	-	36,187	-	175,204	224,845
- - -	- (1,674) -	(510) (194,882) -	(2,445) (10,828) -	- (2,886,670) -	- (63,423) -	- (367,638) -	(2,325) (220,267) (6,339)	- (235,072) -	(112,123) (238,044) (123,357)	(117,403) (4,218,498) (129,696)
194,914	49,210	2,268,134	224,119	64,059,340	1,317,262	1,261,379	536,027	3,222,188	862,048	73,994,621
194,914 -	97,284 (48,074)	4,158,345 (1,890,211)	444,077 (219,958)	120,843,409 (56,784,069)	2,664,996 (1,347,734)	3,924,124 (2,662,745)	1,903,931 (1,367,904)	3,854,412 (632,224)	1,662,243 (800,195)	139,747,735 (65,753,114)
194,914	49,210	2,268,134	224,119	64,059,340	1,317,262	1,261,379	536,027	3,222,188	862,048	73,994,621

194,914 -	49,210 -	2,268,134 536,383	224,119 -	64,059,340 3,479,731	1,317,262 -	1,261,379 1,105,353	536,027 511,924	3,222,188 -	862,048 476,240	73,994,621 6,109,631
- -	- -	- -	- -	- -	- -	- -	(34,155) 30,500	(624,227) 159,400	(294,418) 173,962	(952,800) 363,862
- -	- (1,674)	- (479,139)	- (10,788)	- (3,255,780)	- (63,423)	- (444,132)	(3,655) (299,303)	(464,827) (211,887)	(120,456) (241,268)	(588,938) (5,007,394)
194,914	47,536	2,325,378	213,331	64,283,291	1,253,839	1,922,600	744,993	2,545,474	976,564	74,507,920
194,914 -	97,284 (49,748)	4,694,728 (2,369,350)	444,077 (230,746)	124,323,140 (60,039,849)	2,664,996 (1,411,157)	5,029,477 (3,106,877)	2,381,700 (1,636,707)	3,230,185 (684,711)	1,844,065 (867,501)	144,904,566 (70,396,646)
194,914	47,536	2,325,378	213,331	64,283,291	1,253,839	1,922,600	744,993	2,545,474	976,564	74,507,920
-	2 to 5	2.5 to 10	2.5	3 to 10	2 to 6	No. of production days	10 to 25	14.3	10 to 25

4.1.1 During the year, the Company purchased major spare parts and stand-by equipment amounting to Rs. 3,656,428 (2024: Rs. 1,493,260) and transferred such assets to capital work in progress amounting to Rs. 599,382 (2024: Rs. 783,675).

2025 .......Rupees....... 2024

4.2 Depreciation charge for the year has been allocated as follows:

Cost of sales (note 28) Selling and distribution expenses (note 29) Administrative expenses (note 30)	4,456,352 165,166 385,876	3,698,179 149,243 371,076
	5,007,394	4,218,498

rooted in 403 character driven leadership

rooted in character driven leadership

404

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

4.3 The details of operating assets disposed / written off during the year are as follows:

==> picture [470 x 593] intentionally omitted <==

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||||||||
|---|---|---|---|---|---|---|
|Description and|
|method of disposal|Sold to|Cost|Accumulated|Net book|Sale|Gain /|
|depreciation|value|proceeds|(loss)|
|Items having net book value of|Rupees|
|Rs. 500 each or more|
|Vehicle to employees|
|As per company policy|Nadir Salar Qureshi|17,138|6,555|10,583|21,406|10,823|
|As per company policy|Nadir Salar Qureshi|20,759|9,999|10,760|16,572|5,812|
|As per company policy|Wardah Nadeem|4,948|1,472|3,476|4,159|683|
|As per company policy|Waqas Iqbal|6,900|1,857|5,043|5,842|799|
|As per company policy|Syed Ahsan Bukhari|6,990|1,684|5,306|6,054|748|
|As per company policy|Sundus Alvi|2,577|2,008|569|642|73|
|As per company policy|Kamran Iqbal Siddiqui|3,422|1,632|1,790|3,152|1,362|
|As per company policy|Dr. Rehan Javed|4,866|896|3,970|4,285|315|
|As per company policy|Shahzad Nabi|12,385|11,146|1,239|13,833|12,594|
|As per company policy|Shahzad Nabi|9,446|8,502|944|12,167|11,223|
|As per company policy|Sohair Saad|4,976|1,551|3,425|3,423|(2)|
|As per company policy|Amir Altaf Siddiki|5,538|4,707|831|831|-|
|As per company policy|Awais Mushtaq|5,538|4,707|831|831|-|
|As per company policy|Hassam Khalid|2,655|1,655|1,000|1,303|303|
|As per company policy|Narmeen Habib|4,932|1,397|3,535|4,074|539|
|As per company policy|Mehreen Khalid|8,956|2,030|6,926|7,614|688|
|As per company policy|Zohaib Wajid Jawad|6,749|1,339|5,410|5,963|553|
|As per company policy|Muhammad Imran Khaliq|5,523|4,695|828|828|-|
|As per company policy|Fahad Hassan|3,463|2,208|1,255|1,503|248|
|As per company policy|Faisal Ghaffar|1,940|1,222|718|1,741|1,023|
|As per company policy|Syed Muhammad Farhan|4,931|1,676|3,255|4,013|758|
|As per company policy|Nasir Jamal Khattak|4,826|1,231|3,595|4,403|808|
|As per company policy|Munsif Naveed Aslam|2,628|1,932|696|1,971|1,275|
|As per company policy|Naveed Alam Qureshi|2,665|2,129|536|634|98|
|As per company policy|Attique Ahmed|1,940|1,252|688|1,657|969|
|As per company policy|Arslan Javed|5,127|1,816|3,311|4,216|905|
|As per company policy|Waqas Khan|6,588|933|5,655|6,280|625|
|As per company policy|Muhammad Nauman|5,554|4,721|833|833|-|
|As per company policy|Nadeem Sajjad|3,398|2,888|510|510|-|
|As per company policy|Rehan Hameed|3,514|1,954|1,560|1,862|302|
|As per company policy|Muhammad Ovais Tariq|3,859|2,331|1,528|1,999|471|
|As per company policy|Mouaz Khaleeq Butt|3,374|1,727|1,647|1,676|29|
|As per company policy|Afsah Ahrar|3,397|2,888|509|510|1|
|As per company policy|Syed Shauzab Hassan Gardezi|3,397|2,887|510|509|(1)|
|As per company policy|Muhammad Jahangir|2,674|2,044|630|1,837|1,207|
|As per company policy|Hamid Masood|6,749|2,008|4,741|5,785|1,044|
|As per company policy|Samreen Kausar|3,366|2,861|505|505|-|
|As per company policy|Muhammad Hamza Khan|6,162|2,881|3,281|5,342|2,061|
|As per company policy|Ghulam Ahmad|4,885|969|3,916|3,916|-|
|As per company policy|Babar Mahmood Siddiqui|6,452|3,945|2,507|3,282|775|
|225,187|116,335|108,852|167,963|59,111|
|Vehicles|
|Bidding|Mohammad Faraz Farooqi|5,039|1,571|3,468|3,815|347|
|Aircraft|
|Bidding|Ittehad Sugar Mills|624,227|159,400|464,827|1,436,729|971,902|
|Office equipment|
|Write-off|2,104|509|1,595|-|(1,595)|
|Items having net book value|
|less than Rs. 500 each|
|Operating assets|Various|96,243|86,047|10,196|50,032|39,836|
|952,800|363,862|588,938|1,658,539|1,069,601|
|Year ended December 31, 2025|
|342,248|224,845|117,403|268,189|150,786|
|Year ended December 31, 2024|

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(Amounts in thousand)

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||||||
|---|---|---|---|---|
|4.4|Particulars of immovable properties i.e. land and building which are in the name of the Company are as|
|follows:|
|Location|Total Area (Acreage)|
|Daharki plant & colony|734|
|Zarkhez plant land at Port Qasim|112.5|
|4.5|Capital work in progress|2025|.......Rupees.......|2024|
|Plant and machinery|5,692,630|4,920,287|
|Building and civil works including gas pipeline|262,889|293,426|
|Furniture, fixture and equipment|275,462|280,764|
|Advances to suppliers|6,261,105|1,373,813|
|Others|343,043|283,355|
|12,835,129|7,151,645|
|4.5.1|Includes Rs. 7,642,813 (2024: Rs. 2,050,423) which represents the Company’s share in respect of a joint|
|operation related to Pressure Enhancement Facility (PEF), as disclosed in note 51 to the financial|
|statements.|
|2025|.......Rupees.......|2024|
|4.5.2|Balance as at January 1|7,151,645|7,734,005|
|Additions during the year|11,387,021|8,517,770|
|Borrowing cost capitalised during the year (note 4.5.3)|426,130|-|
|Transferred to:|
|-|
|operating assets (note 4.1)|(6,109,631)|(9,035,720)|
|-|
|intangible assets (note 5)|(20,036)|(64,410)|
|Balance as at December 31|12,835,129|7,151,645|
|4.5.3|The borrowing costs have been capitalised during the year at a capitalisation rate of 12.43%.|

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rooted in 405 character driven leadership

rooted in character 406 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

5. intangible assets

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|||||||
|---|---|---|---|---|---|
|Goodwill|Right to|Software and|Rights for|Total|
|use the|licenses|future gas|
|brand|utilisation|
|(note 5.1)|(note 5.2)|
|Rupees|
|As at January 1, 2024|
|Cost|183,806|4,170,995|1,721,842|102,312|6,178,955|
|Accumulated amortisation|-|-|(930,780)|(63,983)|(994,763)|
|Net book value|183,806|4,170,995|791,062|38,329|5,184,192|
|Year ended December 31, 2024|
|Net book value - January 1, 2024|183,806|4,170,995|791,062|38,329|5,184,192|
|Transfers from CWIP (note 4.5.2)|-|-|64,410|-|64,410|
|Write off|
|Cost|-|-|(762)|-|(762)|
|Accumulated amortisation|-|-|396|-|396|
|-|-|(366)|-|(366)|
|Amortisation (note 5.3)|-|-|(235,575)|(5,110)|(240,685)|
|Net book value|183,806|4,170,995|619,531|33,219|5,007,551|
|As at December 31, 2024|
|Cost|183,806|4,170,995|1,785,490|102,312|6,242,603|
|Accumulated amortisation|-|-|(1,165,959)|(69,093)|(1,235,052)|
|Net book value|183,806|4,170,995|619,531|33,219|5,007,551|

----- End of picture text -----

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----- Start of picture text -----

|||||||
|---|---|---|---|---|---|
|Year ended December 31, 2025|
|Net book value - January 1, 2025|183,806|4,170,995|619,531|33,219|5,007,551|
|Transfers from CWIP (note 4.5.2)|-|-|20,036|-|20,036|
|Amortisation (note 5.3)|-|-|(242,508)|(5,110)|(247,618)|
|Net book value|183,806|4,170,995|397,059|28,109|4,779,969|
|As at December 31, 2025|
|Cost|183,806|4,170,995|1,805,526|102,312|6,262,639|
|Accumulated amortisation|-|-|(1,408,467)|(74,203)|(1,482,670)|
|Net book value|183,806|4,170,995|397,059|28,109|4,779,969|
|Annual rate of amortisation (%)|-|-|12.5 - 25|5|

----- End of picture text -----

5.1 Goodwill and Right to use the brand

Details relating to the discounted cash flow model used to determine the value in use of goodwill and right to use the brand are as follows:

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----- Start of picture text -----

|||
|---|---|
|Valuation basis|Value in use|
|Key assumptions|Sales growth rates|
|Discount rate|
|Determination of assumptions|Growth rates are internal forecasts based on both|
|internal and external market information and|
|past performance.|
|Cost reflects past experience, adjusted for inflation and|
|expected changes.|
|Discount rate is primarily based on weighted average|
|cost of capital.|
|Terminal growth rate|2.5%|
|Period of specific projected cash flows|5 years|
|Discount rate|10.7%|

----- End of picture text -----

The valuation indicates sufficient headroom such that a reasonably possible change to key assumptions is unlikely to result in impairment of related goodwill and right to use the brand.

5.1.1 Right to use the brand is in respect of selling Phosphate fertilizers, acquired under an agreement with the Holding Company (upon amalgamation of EEPL with the Company), that has been valued at initial recognition using Relief from Royalty Method and is considered to have an indefinite life.
5.2 Primarily relates to cost incurred on implementation of new ERP i.e. OneSAP, which is being amortised over a period of 8 years.

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||||||
|---|---|---|---|---|
|5.3|Amortisation for the year has been allocated as follows:|2025|.......Rupees.......|2024|
|Cost of sales (note 28)|61,433|39,924|
|Selling and distribution expenses (note 29)|565|15,219|
|Administrative expenses (note 30)|185,620|185,542|
|247,618|240,685|

----- End of picture text -----

rooted in 407 character driven leadership

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engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

6. investment in subsidiary

Represents investment in EFERT Agritrade (Private) Limited (EAPL) which was incorporated on July 6, 2017 as a wholly owned subsidiary of the Company to carry out business of trading and distribution of imported fertilizer. As part of the business reorganisation in 2017, the Company transferred its business of trading and distribution of imported fertilizer to EAPL and holds 10,000 ordinary shares of Rs. 10 each in EAPL.

8.3 The maximum amount outstanding from executives at the end of any month during the year aggregated to Rs. 74,527 (2024: Rs. 127,739).
8.4 Includes interest free loans given to workers pursuant to Collective Labour Agreement.
8.5 Represents loans granted to employees according to the Company's policy. These loans are interest free, repayable within 1 to 4 years and secured to the extent of the provident fund balance and retirement benefits, if vested, of the respective employees.

7. long-term investments 2025 .......Rupees....... 2024

8.6

The carrying values of the loans and advances are neither past due nor impaired.

At amortised cost

Pakistan Investment Bonds (note 7.1) 3,597,740 3,517,074

7.1 These bonds carry interest at the rate of 7.50% to 17.70% (2024: 13.04% to 17.70%) per annum and have maturity in two to ten years (2024: three to five years).

8. long-term loans, advances and deposits - Considered good Loans and advances to: - Executives (notes 8.1, 8.2, 8.3, 8.5 and 8.6) - Other employees (notes 8.4 to 8.6) Less: Current portion shown under current assets (note 13) Deposits to suppliers 8.1 Reconciliation of the carrying amount of loans and advances to executives Balance as at January 1 Disbursements Repayments / Amortisation Balance as at December 31 8.2 Details of loans and advances to executives Service incentive loans Advances in respect of: - House rent - Salary - Others	2025.......Rupees.......2024 73,820 78,374 43,233 118,637	2025.......Rupees.......2024 73,820 78,374 43,233 118,637
	117,053 (101,587)	197,011 (10,218)
	15,466 11,272	186,793 11,128
	26,738	197,921
	78,374 140,410 (144,964)	64,847 158,474 (144,947)
	73,820	78,374
	9,751 7,112 35,438 21,519	1,034 11,493 34,910 30,937
	73,820	78,374

2025.......Rupees.......2024 2025.......Rupees.......2024 9. stores, spares and loose tools Consumable stores, spares and loose tools (note 9.2) 10,562,208 9,401,410 Less: Provision for surplus and slow moving items (note 9.1) (1,411,138) (1,161,883) 9,151,070 8,239,527 9.1 Provision for surplus and slow moving items Balance as at January 1 1,161,883 971,830 Charge for the year 304,923 309,397 Reversal during the year (55,668) (118,540) Written off during the year - (804) Balance as at December 31 1,411,138 1,161,883 9.2 During the year, the Company has directly written off stores, spares and loose tools amounting to Rs. 3,811 (2024: Rs. 968). 10. stock-in-trade Raw materials (note 10.3) 4,899,226 4,731,622 Packing materials 284,203 771,330 Work in process 269,136 44,113 5,452,565 5,547,065 Finished goods - manufactured products 5,776,028 6,887,648 Less: Provision for impairment against stock-in-trade (note 10.1) (143,434) (229,782) 11,085,159 12,204,931 10.1 Provision for impairment against stock-in-trade Balance as at January 1 229,782 37,341 Charge for the year - 192,441 Written off during the year (86,348) - Balance as at December 31 143,434 229,782	2025.......Rupees.......2024 10,562,208 9,401,410 (1,411,138) (1,161,883)	2025.......Rupees.......2024 10,562,208 9,401,410 (1,411,138) (1,161,883)
	9,151,070	8,239,527
	1,161,883 304,923 (55,668) -	971,830 309,397 (118,540) (804)
	1,411,138	1,161,883
	5,452,565 5,776,028 (143,434)	5,547,065 6,887,648 (229,782)
	11,085,159	12,204,931
	229,782 - (86,348)	37,341 192,441 -
	143,434	229,782

9.2 During the year, the Company has directly written off stores, spares and loose tools amounting to Rs. 3,811 (2024: Rs. 968).
10.2 During the year, the Company has directly written off stock-in-trade amounting to Rs. 39,555 (2024: Rs. 79,061).
10.3 Includes stock-in-transit amounting to Rs. 1,201,733 (2024: Rs. 998,176).

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engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

11. trade debts


trade debts Considered good - Secured (note 11.1) - Unsecured Considered doubtful (note 11.2) Less: Provision for impairment against trade debts (note 11.2) These debts are secured by way of bank guarantee. Provision for impairment against trade debts Balance as at January 1 Reversal for the year - net Balance as at December 31	2025.......Rupees.......2024 12,628,023 4,944,266 1,572,216 743,083
	14,200,239 41,452	5,687,349 80,540
	14,241,691 (41,452)	5,767,889 (80,540)
	14,200,239	5,687,349
	80,540 (39,088)	111,560 (31,020)
	41,452	80,540

11.1 These debts are secured by way of bank guarantee.

11.2 Provision for impairment against trade debts

12. other receivables

Subsidy receivable from the Government of Pakistan - net (notes 12.1 and 12.2) Sales tax and FED receivable Due from Associated Companies: - Engro Polymer and Chemicals Limited - Engro Eximp Agriproducts (Private) Limited - Sindh Engro Coal Mining Company Limited - Engro Elengy Terminal (Private) Limited - Engro Vopak Terminal Limited - Engro Enfrashare (Private) Limited - Think PVC (Private) Limited - Engro Peroxide (Private) Limited - Elengy Terminal Pakistan Limited - Engro Energy Services Limited - Engro Technical Solutions (Private) Limited Receivable from Defined Benefit Gratuity Fund - MPT (note 40.2.1) Receivable from Workers' Profits Participation Fund (note 23.6) Others (note 12.5)	3,436,470 2,680,547 172,202 - 204 3,924 4,495 2,291 - 1,000 9 - 509 29,432 260,199 104,269	2,811,755 4,222,484 392,855 8,355 - 51,134 12,417 2,227 12 721 30 10 - 22,543 - 2,975,693
	6,695,551	10,500,236

(Amounts in thousand)

2025.......Rupees.......2024 Subsidy receivable from the Government of Pakistan - net Gross subsidy receivable from the GoP 6,523,493 6,523,493 Less: Provision against doubtful receivable (155,127) (155,127) Less: Loss allowance on subsidy receivable from the GoP (note 12.3) (2,931,896) (3,556,611) 3,436,470 2,811,755 The movement in loss allowance on subsidy receivable from the GoP is as follows: Balance as at January 1 3,556,611 4,759,699 Gain for the year (note 34) (624,715) (1,203,088) Balance as at December 31 2,931,896 3,556,611 2025.......Rupees.......2024	6,523,493 6,523,493 (155,127) (155,127) (2,931,896) (3,556,611) 2025.......Rupees.......2024	6,523,493 6,523,493 (155,127) (155,127) (2,931,896) (3,556,611) 2025.......Rupees.......2024
	3,436,470	2,811,755
	2,931,896	3,556,611

12.2 Subsidy receivable from the Government of Pakistan - net

12.3

12.3.1 As required under IFRS 9, an entity is required to assess changes in credit risk by taking into account the time value of money, reasonable and supportable assumptions regarding past events, current conditions, forecast of future events and economic conditions attached to its receivables and recognise expected credit loss, if any. Based on this, the Company has recomputed expected credit loss amounting to Rs. 2,931,896 (2024: Rs. 3,556,611) on subsidy receivable from the GoP giving due consideration to the time value of money based on expected recovery of the subsidy receivable. The Company, however, is confident of full recovery of the subsidy amount from the GoP.
12.1 In FY 2015, the Government of Pakistan (GoP) notified payment of subsidy on sold products at the rate of Rs. 500 per 50 kg bag of Di Ammonia Phosphate (DAP) and Rs. 217 per 50 kg bag of Nitrophos (N) and NPK fertilizers (based on phosphorous content). This subsidy scheme was effective till May 27, 2016.

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engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

12.4 The maximum amount due from the associated companies at the end of any month during the year is as follows:

Maximum
aggregate
amount
outstanding
at the end
of any month
Not Yet
Due
Maximum
aggregate
amount
outstanding
at the end
of any month
Not Yet
Due
Subsidiary Company
- EFERT Agritrade (Private) Limited
5,556,272
-
Associated Companies
- Sindh Engro Coal Mining Company Limited
290
188
- Engro Polymer and Chemicals Limited
398,560
(3,498)
- Engro Energy Services Limited
10
-
- Engro Vopak Terminal Limited
14,053
8,606
- Elengy Terminal Pakistan Limited
30
-
- Think PVC (Private) Limited
12
-
- Engro Peroxide (Private) Limited
1,000
1,000
- Engro Elengy Terminal (Private) Limited
51,443
4,229
- Engro Technical Solutions (Private) Limited
1,217
-
- Engro Enfrashare (Private) Limited
2,291
-
10,525
Holding Company
84,360
-
Subsidiary Company
- EFERT Agritrade (Private) Limited
10,922,325
-
Associated Companies
- Sindh Engro Coal Mining Company Limited
13,223
-
- Engro Polymer and Chemicals Limited
414,858
(21,119)
- Engro Energy Services Limited
157
(147)
- Engro Vopak Terminal Limited
13,804
1
- Engro Powergen Qadirpur Limited
9,114
-
- Engro Powergen Thar (Private) Limited
2,307
-
- Engro Energy Limited
477,983
-
- Elengy Terminal Pakistan Limited
30
-
- Think PVC (Private) Limited
31
(19)
- Engro Peroxide (Private) Limited
752
(31)
- Engro Plasticizer (Private) Limited
6
-
- Engro Elengy Terminal (Private) Limited
123,729
(598)
- Engro Infiniti (Private) Limited
79
-
- Engro Foundation
2,231
-
- Engro Eximp Agriproducts (Private) Limited
8,355
1
- Engro Enfrashare (Private) Limited
2,227
-
(21,912)

Past Due

348,697
58,169
82,807
467,761

(Amounts in thousand)

12.5 This includes Nil (2024: Rs. 2,970,119) paid to a gas supplier pursuant to an arrangement under which the Company has committed to fulfil certain obligations in case of default by another gas company.

13. loans, advances, deposits and prepayments - Considered good Current portion of long term loans and advances to executives and other employees (note 8) Advances and deposits Prepayments: - Insurance - Freight - Others	2025.......Rupees.......2024 101,587 10,218 1,441,022 1,912,405 512,659 529,737 273,399 282,022 52,419 682,759	2025.......Rupees.......2024 101,587 10,218 1,441,022 1,912,405 512,659 529,737 273,399 282,022 52,419 682,759
	2,381,086	3,417,141

14. working capital loan to subsidiary

Represents unsecured loan given to EAPL (a subsidiary company). The mark-up is receivable on quarterly basis at the rate of 1 month KIBOR + 0.5% (2024: 1 month KIBOR + 0.5%) per annum.

15. short-term investments At fair value through profit or loss Investment in units of mutual funds (notes 15.1 and 15.1.1) At amortised cost Term Deposit Receipts (note 15.2)	14,812,850 2,489,411 250,000 250,000 2025.......Rupees.......2024	14,812,850 2,489,411 250,000 250,000 2025.......Rupees.......2024
	15,062,850	2,739,411

15.1 This represents investment in 233,487,085 units (2024: 24,842,639 units) of Mutual Funds having cost amounting to Rs. 14,788,481 (2024: Rs. 2,439,561).
15.1.1 This includes investment in 62,013,352 units (2024: 11,057 units) of Shariah Compliant mutual funds amounting to Rs. 6,608,243 (2024: Rs. 1,011) having cost amounting to Rs. 6,600,805 (2024: Rs. 1,035).
15.2 Term Deposit Receipts carries interest at the rate of 8% (2024: 13.00%) per annum.

16. cash and bank balances

cash and bank balances Cash at banks in: - deposit accounts (notes 16.1 and 16.3) - current accounts and non-negotiable instruments (notes 16.2 and 16.4) Cash in hand	2025.......Rupees.......2024 183,997 1,543,703 7,765,100 2,714,629	2025.......Rupees.......2024 183,997 1,543,703 7,765,100 2,714,629
	7,949,097 200	4,258,332 3,113
	7,949,297	4,261,445

16.1 Deposit accounts carry return at the rates ranging from 8% to 11.5% (2024: 10% to 20.50%) per annum.
16.2 Includes Rs. 559,907 (2024: Rs. 574,375) held in foreign currency bank accounts.
16.3 Includes Shariah Compliant bank balances amounting to Nil (2024: Rs. 423,924).
16.4 Includes Shariah Compliant bank balances amounting to Rs. 177,589 (2024: Rs. 214,661).

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rooted in character 414 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

share capital Authorised capital 1,400,000,000 (2024: 1,400,000,000) Ordinary shares of Rs. 10 each Issued, subscribed and paid-up capital 258,132,299 (2024: 258,132,299) Ordinary shares of Rs. 10 each, fully paid in cash 9,999,993 (2024: 9,999,993) Ordinary shares of Rs. 10 each issued as at January 1, 2010 on transfer of fertilizer undertaking 1,062,800,000 (2024: 1,062,800,000) Ordinary shares of Rs. 10 each, issued as fully paid bonus shares 4,367,083 (2024: 4,367,083) Ordinary shares of Rs. 10 each issued upon exercise of conversion option by International Finance Corporation (IFC)	2025.......Rupees.......2024 14,000,000 14,000,000	2025.......Rupees.......2024 14,000,000 14,000,000
	2,581,323 100,000 10,628,000 43,670	2,581,323 100,000 10,628,000 43,670
	13,352,993	13,352,993

17. share capital

17.1 As at reporting date, the Holding Company held 56.27% (2024: 56.27%) of the share capital of the Company.
17.2 These fully paid ordinary shares carry one vote per share and right to dividend.

reserves Capital reserves Share premium Reserve on amalgamation (note 18.1) Revenue reserves Remeasurement of post employment benefits Unappropriated profit	2025.......Rupees.......2024 3,384,904 3,384,904 (304,027) (304,027) 3,080,877 3,080,877 (38,559) (69,897) 28,564,531 30,164,684 28,525,972 30,094,787	2025.......Rupees.......2024 3,384,904 3,384,904 (304,027) (304,027) 3,080,877 3,080,877 (38,559) (69,897) 28,564,531 30,164,684 28,525,972 30,094,787
	31,606,849	33,175,664

18.

18.1 This reserve was created upon amalgamation of Engro Eximp (Private) Limited with the Company.

(Amounts in thousand)

19. borrowings - secured (non-participatory)

Note Mark - up rate per annum Long term finance utilised under: Senior Lenders Allied Bank Limited 19.3 and 19.5 3 months KIBOR + 0. Allied Bank Limited 19.3 and 19.5 3 months KIBOR + 0. Allied Bank Limited 19.3 and 19.5 3 months KIBOR + 0. Standard Chartered Bank (Pakistan) Limited 3 months KIBOR - 0.6 United Bank Limited 3 months KIBOR - 0.2 Meezan Bank Limited 3 months KIBOR + 0. Habib Bank Limited 3 months KIBOR + 0. Habib Bank Limited 19.3 and 19.5 3 months KIBOR - 0.2 MCB Bank Limited 3 months KIBOR - 0.2 Medium Term Loans Meezan Bank Limited 19.2 1 month KIBOR + 0.5 Allied Bank Limited 19.2 3 months KIBOR + 0. Askari Bank Limited 19.2 3 months KIBOR + 0. Bank Al-Falah Limited 19.2 1 month KIBOR + 0.4 Bank Islami Limited 19.2 3 months KIBOR + 0. TERF Loans Allied Bank Limited 19.4 and 19.5 1.50% Habib Bank Limited 19.4 and 19.5 2.00% MCB Bank Limited 19.4 and 19.5 1.50% Less: Fair value adjustment for loan 20 at below market rate Less: Current portion shown under current liabilities	Installments Number Commenced / Commencing from 35% 6 half yearly June 21, 2023 35% 12 quarterly March 30, 2023 35% 6 half yearly June 30, 2023 0% 4 quarterly April 03, 2026 5% 4 quarterly December 27, 2025 10% 28 quarterly March 31, 2028 10% 12 quarterly December 30, 2026 5% 6 half yearly December 30, 2025 5% 4 quarterly February 11, 2026 0% lump sum March 31, 2027 40% lump sum March 31, 2027 40% lump sum March 31, 2027 5% lump sum March 31, 2027 30% lump sum March 26, 2027 Various March 30, 2023 Various January 29, 2022 Various January 13, 2023	2025.......Rupees.......2024	2025.......Rupees.......2024

		- - - 4,000,000 3,000,000 2,000,000 5,000,000 2,250,000 5,000,000	333,333 110,325 23,675 - 3,000,000 2,000,000 5,000,000 3,000,000 5,000,000
		21,250,000	18,467,333
		3,000,000 3,000,000 5,000,000 4,000,000 5,000,000	- - - - -
		20,000,000	-
		449,220 552,270 2,170,410 3,171,900 (514,355)	539,945 641,084 2,604,451 3,785,480 (717,092)
		2,657,545 43,907,545 (14,461,586)	3,068,388
			21,535,721 (2,834,018)
		29,445,959	18,701,703

19.1 All senior debts are secured by an equitable mortgage upon immovable property of the Company and equitable charge over current and future operating assets excluding immovable property of the Company.
19.2 All medium term debts are secured by joint pari passu floating charges over current assets and future stocks of the Company. All the medium term loans have been repaid in full (subsequent to the year end).
19.3 During the year, the Company made principal repayments of long term finances to Habib Bank Limited and Allied Bank Limited amounting to Rs. 750,000 and Rs. 467,333 respectively.
19.4 During the year, the Company repaid TERF loan to Allied Bank Limited, Habib Bank Limited and MCB Bank Limited amounting to Rs. 90,725, Rs. 88,814 and Rs. 434,041, respectively. These borrowings have the same charge as the borrowings from other Senior Lenders on operating assets. Mark-up is chargeable at concessional rates ranging from 1.50% to 2.00% per annum and is payable in quarterly or semi-annual installment starting from January 2022.

In accordance with IFRS 9 'Financial Instruments', the Company has recognised these loans at their fair value and the differential markup as deferred government grant income, as mentioned in note 20 to the financial statements, which will be amortised and set off against finance cost over the period of the facilities

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engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

19.5 Following are the changes in long-term borrowings for which cash flows have been classified as financing activities in the statement of cash flows:

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----- Start of picture text -----

||||
|---|---|---|
|2025|.......Rupees.......|2024|
|Balance as at January 1|21,535,721|5,982,441|
|Borrowings availed during the year|24,000,000|18,000,000|
|Repayment of borrowings|(1,830,913)|(2,686,717)|
|Fair value adjustment for below market rate - net (note 20)|202,737|239,997|
|Balance as at December 31|43,907,545|21,535,721|

----- End of picture text -----

19.6 In accordance with the terms of the Inter-Creditor Agreement (ICA), the Company is obligated to comply with certain financial and non-financial covenants including Senior Finance Service Coverage Ratio, Finance to equity ratio, Total Finance to Equity Ratio, Current Ratio and Senior Finance to EBITDA. The details of such covenants are:

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----- End of picture text -----

As of the reporting date, the Company has not complied with one of its covenant, i.e. current ratio. However, the Company has received a relaxation from the respective banks for a period of 12 months from the reporting date. The Company based on it projections remains confident that there are no indicators that it will have difficulties in complying with the required financial covenants when these will be next tested.

19.7 In accordance with the terms of the facility agreeement with Standard Chartered Bank Limited, the Company is also obligated to comply with certain non-financial and financial covenants including Debt Service Cover Ratio, Debt to EBITDA Ratio and Debt to Equity Ratio.

Type of Ratio Requirement Debt Service Cover Ratio Minimum 1.25x Debt to EBITDA Ratio Maximum 2.5x Debt to Equity Ratio Maximum 2x

20. government grant

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----- Start of picture text -----

|||||
|---|---|---|---|
|government grant|2025|.......Rupees.......|2024|
|Balance as at January 1|717,092|957,089|
|Less: released to the statement of profit or loss (note 33.1)|(202,737)|(239,997)|
|514,355|717,092|
|Less: Current portion|(171,721)|(202,737)|
|342,634|514,355|

----- End of picture text -----

20.1 The Company recognised government grant on loan received at below market interest rate (note 19.4) in accordance with IAS 20 - 'Accounting for government grants and disclosure of government assistance'.

(Amounts in thousand)

21. deferred taxation

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|||||||||
|---|---|---|---|---|---|---|---|
|Balance as|Recognised|Recognised|Balance as|Recognised|Recognised|Balance as|
|at January|in profit|in OCI|at December|in profit|in OCI|at December|
|1, 2024|or loss|31, 2024|or loss|31, 2025|
|Taxable temporary differences|(note 35)|(note 35)|
|---------------------------------------------------------------------------------- Rupees ----------------------------------------------------------------------------------|
|- Accelerated depreciation allowance|
|and Staff retirement benefits|18,611,563|1,402,797|2,869|20,017,229|205,800|20,035|20,243,064|
|Deductible temporary differences|
|- Provisions|(8,209,853)|(9,943,706)|-|(18,153,559) (2,127,241)|- (20,280,800)|
|10,401,710|(8,540,909)|2,869|1,863,670 (1,921,441)|20,035|(37,736)|

----- End of picture text -----

22. deferred liabilities

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----- Start of picture text -----

|||||
|---|---|---|---|
|deferred liabilities|2025|.......Rupees.......|2024|
|Deferred income (note 22.1)|34,464|38,329|
|Service benefit obligations|97,675|266,975|
|Less: Current portion shown under|
|current liabilities|(97,675)|(62,356)|
|-|
|204,619|
|34,464|242,948|

----- End of picture text -----

22.1 This represents Rs. 96,627 received from Engro Powergen Qadirpur Limited (EPQL), an associated company, for the right to use the Company's infrastructure facilities at Daharki Plant by the employees of EPQL for a period of twenty five years. The amount is being amortised over such period.

23. trade and other payables

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|||||
|---|---|---|---|
|trade and other payables|2025|.......Rupees.......|2024|
|Creditors|1,775,511|938,866|
|Accrued liabilities (notes 23.1 to 23.3)|46,758,654|44,114,798|
|Advances from customers, contract liabilities (note 23.4)|2,660,948|1,867,608|
|Payable to:|
|- FrieslandCampina Engro Pakistan Limited|20|20|
|- EFERT Agritrade (Private) Limited|11,205,539|7,067,328|
|- Engro Powergen Thar (Private) Limited|59|2,997|
|- Engro Eximp FZE|700,314|523,501|
|- Engro Corporation Limited|165,302|539,830|
|- Sindh Engro Coal Mining Company Limited|-|1,107|
|- Engro Foundation|323,403|393,769|
|- Engro Energy Limited|6,700|479,048|
|- Engro Powergen Qadirpur Llimited|1,813|9,884|
|- Engro Technical Solutions (Private) Limited|-|150,542|
|- Defined Contribution Provident Fund|1,343|1,352|
|- Defined Contribution Provident Fund - NMPT|38|21|
|- Defined Contribution Gratuity Fund - MPT|20,021|4,790|
|- Defined Benefit Pension Fund (note 40.2.1)|12,427|12,646|
|- Defined Benefit Gratuity Fund - NMPT (note 40.2.1)|175,033|172,464|
|Deposits / Retention from dealers and contractors (note 23.5)|431,480|376,296|
|Workers' Welfare Fund (WWF) (note 23.6)|1,607,943|1,459,852|
|Workers' Profits Participation Fund (WPPF) (note 23.6)|-|298,260|
|Witholding tax payable|341,727|133,373|
|Others|37,813|140,024|
|66,226,088|58,688,376|

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rooted in 417 character driven leadership

rooted in character 418 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

(Amounts in thousand)

23.1 On June 4, 2021, the Sindh High Court (SHC) through its judgement upheld the Sindh Development and Maintenance of Infrastructure Cess Act, 2017 promulgated retrospectively with effect from July 01, 1994 as valid and declaring it within the competence of provincial legislature. The Company maintains adequate accrual in these financial statements and has filed Civil Petition for Leave to Appeal (CPLA) before the Honorable Supreme Court of Pakistan (SCP) to challenge the SHC Judgement. On September 01, 2021, the SCP granted an interim relief in the appeals and suspended the SHC Judgement. The Company carries an accrual of Rs. 2,096,980 (2024: Rs. 1,908,216) in this respect.
23.2 On June 10, 2021, the Company filed a Suit before the SHC in which it prayed that Sui Northern Gas Pipelines Limited (SNGPL) be directed to supply the contracted / committed volume of feed gas at concessionary pricing under the Gas Sale and Purchase Agreement and in accordance with the Fertilizer Policy 2001, Instructions to Bidders and various Economic Coordination Committee decisions.

The SHC was pleased to grant an ad interim stay vide its order dated June 21, 2021, directing the parties to maintain status quo with regard to disconnection of gas supply and pricing. The Company, without prejudice to the pending Suit and any admission of liability, has on prudent basis recorded an accrual of Rs. 21,219,869 (2024: Rs. 21,219,869) in these financial statements.

23.3 In 2022, the Company received a letter from one of its gas supplier, which indicated that the pricing of gas supplied to the Company from the aforementioned gas field would be higher of the applicable Petroleum Policy or the gas price notified by the Oil and Gas Regulatory Authority (“OGRA”) for the fertilizer sector and such charge shall be applicable from the date of execution of the Gas Sale and Purchase Agreement (GSPA).

In this regard, the Company has submitted a formal response to the gas supplier. Without prejudice to the foregoing and any admission of liability, the Company has on prudent basis recorded an accrual amounting to Rs. 2,380,450 (2024: Rs. 2,380,450) in these financial statements.

23.4 This represents advances received by the Company from customers for goods to be delivered. The advances outstanding as at January 01, 2025 have been fully recognised as revenue during the year.
23.5 The amount is kept in separate term deposits account as per the terms of agreements and is not utilised for the purpose of the business of the Company.

23.6 movement of WPPF / WWF Balance as at January 1 Charge for the year (note 32) Payments during the year Balance as at December 31	2025 WPPF WWF -------------------------------------------- Rupees 298,260 1,459,852 2,091,542 1,148,091 (2,650,001) (1,000,000)	2024
		-------------------------------------------- WPPF WWF (393,056) 1,324,099 2,358,934 815,753 (1,667,618) (680,000)
	(260,199) 1,607,943	298,260 1,459,852

24. provision for gas infrastructure development cess

The Honorable Supreme Court of Pakistan (SCP) through its judgement dated August 13, 2020 (the Judgment) declared that the levy imposed under the Gas Infrastructure Development Cess (GIDC) Act, 2015 (the GIDC Act) is valid and in accordance with the provisions of the Constitution of Pakistan 1973 (the Constitution). The SCP in its Judgement stated that the Government has already collected Rs. 295,000,000 and this amount combined with the outstanding amount would be in the vicinity of Rs. 700,000,000. The SCP, therefore, issued the following directions:

It restrained the Federal Government from charging further GIDC until such time that the GIDC already collected and accrued (but not yet collected), is expended on projects listed under the GIDC Act;

(Amounts in thousand)

As all industrial and commercial entities which consume gas for their business activities pass on the burden to their customers, therefore, GIDC that has become due up to July 31, 2020, and has not been recovered so far, shall be recovered by the gas companies responsible under the GIDC Act to recover from their consumers in twenty-four equal monthly installments, without the component of Late Payment Surcharge (LPS); and
In case, no work is carried out on the gas infrastructure pipelines in the manner and / or time specified in the Judgement, the purpose of levying GIDC shall be deemed to have been frustrated and the GIDC Act would become completely in-operational and considered dead for all intents and purposes.

Pursuant to the Judgement, the gas suppliers began invoicing the GIDC instalments for recovery with effect from August 01, 2020.

Aggrieved by the Judgement, the Company filed a review petition before the SCP, which was dismissed by the SCP on November 02, 2020 (Review Decision). However, the Review Decision (i) noted that the Government of Pakistan is agreeable to recover the unpaid arrears in 48 monthly installments instead of 24 monthly installments provided the time period for the projects was extended to 12 months from 6 months; and (ii) upheld the validity of Section 8(2) of the GIDC Act. The SCP protected the rights of the Industrial Sector (excluding Fertilizer Fuel Stock) to approach the appropriate fora for enforcement of the exemption provided under the proviso to Section 8(2) of the GIDC Act.

Subsequent to the Review Decision, the Company filed a rectification application before the SCP seeking a clarification regarding the increase in number of installments.

The Company also filed a suit before the Sindh High Court (SHC) on December 17, 2020, against collection of GIDC on non-concessionary feed gas supplied under the non-fixed price contracts and the fuel gas, on the basis of relief available under Section 8(2) of the GIDC Act and on the grounds that factual determination of the GIDC passed-on is to be carried out. The SHC granted the Company an interim stay restraining the impleaded gas companies from taking coercive action against the Company for non-payment of GIDC installments.

Further, against the GIDC instalment invoice received from SNGPL on concessionary gas supplied under the fixed price Gas Sale and Purchase Agreement (GSPA) dated April 11, 2007, the Company approached the SHC to challenge this imposition. The Company has obtained a stay order in its favour and the SHC has restrained SNGPL from taking any coercive against the Company on collecting GIDC on feed stock gas supplied to the Company under the GSPA. The management has made an assessment (as confirmed by the legal advisor) that there are reasonable chances of a favourable outcome in relation to the legal proceedings filed against SNGPL for feed gas supplied under the GSPA. Hence, no provision on account of GIDC has been recorded by the Company in these financial statements in respect of feed gas received under the GSPA.


short-term borrowings Short-term running finances (note 25.1) Privately placed short-term sukuk (note 25.2)	2025.......Rupees.......2024 3,022,723 12,451,622 20,000,000 -
	23,022,723	12,451,622

25. short-term borrowings

25.1 The Company has funded facilities for short-term finances available from various banks and institutional investors amounting to Rs. 43,420,000 (2024: Rs. 68,420,000) along with non-funded facilities of Rs. 12,532,000 (2024: Rs. 11,432,000) for bank guarantees, out of which facilities amounting to Rs. 11,525,000 (2024: Rs. 11,525,000) of funded and Rs. 7,100,000 (2024: Rs. 5,100,000) of non-funded

rooted in 419 character driven leadership

rooted in character 420 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

facilities are interchangeable with the subsidiary company. The rates of mark-up on funded bank overdraft facilities ranged from minus 0.05% to 0.5% (2024: minus 2.00% to 0.5%) per annum over 1-month, 3-month and 6-month KIBOR and all facilities are secured by floating charge upon all present and future stocks including raw and packing materials, finished goods, stores and spares and other merchandise and on all present and future book debts, outstanding monies, receivable claims and bills of the Company. The Company has utilised Rs. 3,022,723 (2024: Rs. 12,451,622) from funded facilities and Rs. 6,801,834 (2024: Rs. 6,817,869) from non-funded facilities as at the reporting date.

25.2 The Company has placed unsecured Privately Placed Short Term Sukuk (PPSTS) with an issue size of Rs. 20,000,000. These are payable within six months from the issuance date and carry a markup at the rate of 3-month KIBOR minus 0.15%. These proceeds will be used for the Company's working capital management.

26. contingencies and commitments

Contingencies

26.1 As at December 31, 2025, bank guarantees of Rs. 6,801,834 (2024: Rs. 6,817,869) have been issued in favour of third parties.
26.2 In 2021, the income tax department [i.e. Large Taxpayers Unit (LTU)] initiated income tax audits of the Company u/s 177 of the Income Tax Ordinance, 2001 (the Ordinance) for the Tax Year (TY) 2015, 2016, 2018 and 2020 and sales tax audits u/s 25 of the Sales Tax Act, 1990 for TY 2017, 2018 and 2019 in accordance with the sectoral audit directives issued by Federal Board of Revenue (FBR). As such, the Company received audit selection notices for all these years. The sales tax audit selection notices in respect of all three years were challenged in the Sindh High Court (SHC) where the Court dismissed the audit notices thereby deciding the matter in favour of the Company.

In respect of income tax audits, the tax department completed the amendments for all tax years creating an aggregate demand of Rs. 18,566,262. As per current status, all major issues raised in the amendments stand concluded except for tax year 2018 where demand of Rs. 1,515,000 has been raised. The Company filed an Income Tax Reference Application in the SHC where the matter has been remanded back to the Tribunal. A similar matter of tax year 2019 involving demand of Rs. 547,000 is pending in the Tribunal.

Management considers, based on the tax advisor’s opinion, that it has reasonable grounds to defend the case and therefore will not be exposed to any additional liability in this respect.

26.3 In 2022, in respect of TY 2018, the Company received an order from the Assistant Commissioner Inland Revenue (ACIR) restricting brought forward losses having a tax impact of Rs. 639,001. This disallowance had been made in the assessment orders relating to prior years which are pending in appeals. Certain errors have been made in relation to allowance of credits which will be taken up in rectification.

Management considers, based on the tax advisor’s opinion, that it has reasonable grounds to defend the case and therefore will not be exposed to any additional liability in this respect.

26.4 The Company filed a constitutional petition in the SHC against the Ministry of Petroleum and Natural Resources (MPNR), Ministry of Industries and Production (MoIP) and SNGPL for continuous supply of 100 mmscfd gas per day to the Company's new plant (Enven) and to prohibit from suspending, discontinuing or curtailing the aforementioned supply. Through its order dated October 18, 2011, the SHC ordered that SNGPL should supply 100 mmscfd gas per day to the Company’s new plant. However, five petitions have been filed in the SCP against the aforementioned order of the SHC by SNGPL, MPNR, Agritech Limited, Pak Arab Fertilizers and Kohinoor Mills Limited along with twenty one other companies (mainly engaged in textile business). The aforementioned petitions are pending for further hearing. The Company’s management, as confirmed by the legal advisor, considers the chances of these petitions being allowed to be low.

(Amounts in thousand)

Further, the Company upon continual curtailment of gas after the aforementioned decision of the SHC filed an application in respect of Contempt of Court under Article 199 & 204 of the Constitution of Pakistan. The Company, in the aforementioned application has submitted that SNGPL and MPNR have failed to restore full supply of gas to the Company’s plant despite the judgement of the SHC in the Company’s favor. A show cause notice has also been issued against MPNR and SNGPL dated December 31, 2011 by the SHC. The application is pending for hearing and no orders have yet been passed in this regard.

26.5 All Pakistan Textile Processing Mills Association (APTMA), Agritech Limited (Agritech), Shan Dying & Printing Industries (Private) Limited and twenty seven others have each contended, through separate proceedings filed before the Lahore High Court that the supply to the Company’s new plant is premised on the output from Qadirpur gas field exceeding 500 mmscfd by 100 mmscfd and, therefore, the Gas Sale and Purchase Agreement (GSA) dated April 11, 2007 between the Company and SNGPL be declared void ab initio because the output of Qadirpur gas field has in fact decreased. Agritech has additionally alleged discrimination in that it is receiving less gas than the other fertilizer companies on the SNGPL system. The Company has outrightly rejected these contentions, and is of the view that it has a strong case for the reasons that (i) 100 mmscfd gas has been allocated to the Company through a transparent international competitive bidding process held by the Government of Pakistan, and upon payment of valuable license fee; (ii) GSA guarantees uninterrupted supply of gas to the Company's new plant, with right to first 100 mmscfd gas production from the Qadirpur gas field; and (iii) both the Company and the Qadirpur gas field are located in Sindh. Also, neither the gas allocation by the Government of Pakistan nor the GSA predicates the gas supply from Qadirpur gas field producing 100 mmscfd over 500 mmscfd. No orders have been passed in this regard and the petition has also been adjourned sine die given that a similar matter is pending in the SCP. However, the Company’s management, as confirmed by the legal advisor, considers chances of petitions being allowed to be low.
26.6 In 2013, the Company, along with other fertilizer companies, received a show cause notice from the Competition Commission of Pakistan (CCP) for initiating action under the Competition Act, 2010 (2010 Act) in relation to alleged unreasonable increase in fertilizer prices. The Company has responded in detail that factors resulting in such an increase were mainly due to the imposition of infrastructure cess, sales tax and gas curtailment. The CCP issued an order in March 2013, whereby it held that the Company has a dominant position in the urea market and that it has abused the same by unreasonable increases in urea prices during the period December 2010 to December 2011. The CCP also held another major fertilizer company to be responsible for abusing its dominant position. Moreover, the CCP imposed a penalty of Rs. 3,140,000 and Rs. 5,500,000 on the Company and the other fertilizer company, respectively. An appeal has been filed before the Competition Appellate Tribunal (CAT) and a writ has been filed in the SHC wherein stay has been granted in favour of the Company restraining CCP and Federation of Pakistan (i.e., Respondents) from taking any coercive action.

In the case of the other fertilizer company, CAT has transferred the case back to the CCP for reassessment. The Company has also challenged the composition of the CAT before the SHC and has secured an interim order in its favour whereby the CAT is restrained from passing any final order against the Company during the pendency of the petition. The Company's management believes that the chances of ultimate success are strong and, hence, no provision has been made in this respect.

In 2024, the petitions were disposed off with a direction to the CAT to decide the Company's appeal and in the meantime CCP has been restrained from taking any adverse action against us on the basis of the 2013 order.

26.7 In 2015, the Company received a sales tax order from the tax department for the tax periods January 01, 2013 to December 31, 2013, pertaining to discharge of output tax liability, on assumed production of urea amounting to Rs. 402,875 and on the presumption that output tax liability is not being discharged by the Company on advances received from dealers amounting to Rs. 1,844,075. The Company filed an appeal

rooted in 421 character driven leadership

rooted in character 422 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

thereagainst, with the CIR(A) which decided the matters in favour of the Company. The department thereafter challenged the decision of the CIR(A) with the ATIR which is pending adjudication. The Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these financial statements.

26.8 In 2018, the tax department [i.e., Large Taxpayers Unit (LTU)] issued an order for the period June 2016 to July 2017 with a demand of Rs. 1,006,000 mainly on account of further sales tax to be charged on fertilizers sales to unregistered persons. The Company filed an appeal before the CIR(A) who disposed off the appeal in favour of the tax department. Thereafter, the Company filed an appeal before the ATIR, and it also decided the same in favour of the tax department. The Company challenged the ATIR Order, to the extent of its ruling in relation to exemption from further sales tax, before the SHC by filing Sales Tax Reference Application. On October 11, 2021, the SHC granted an ad-interim order restraining the tax department from taking coercive action against the Company in respect of the recovery of the impugned demand. The Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these financial statements.
26.9 During the year, the tax department [i.e. Large Taxpayers Unit (LTU)] issued an order for the period June 2022 under the Sales Tax Act 1990 reducing the Company's sales tax refund claim by Rs. 660,000. The Company has filed an appeal before the CIR(A) which is currently pending adjudication. The Company's management believes that the chances of ultimate success are good, hence, no provision has been made in this respect in these financial statements.
26.10 The Federal Constitutional Court (FCC) has upheld the constitutionality of Sections 4B and 4C of the Income Tax Ordinance, 2001. Further details are disclosed in note 35 of these financial statements.

26.11 Commitments


Commitments Commitments in respect of: - Capital expenditure - Other operational items net sales Revenue from contracts with customers - Gross sales: - manufactured products - purchased and packaged products - services Less: Trade discount Less: Sales tax and duties	2025.......Rupees.......2024 24,170,211 32,443,785 10,812,415 8,693,832
	34,982,626	41,137,617
	211,632,299 - - 211,632,299 (7,401,407) (10,983,152)	192,233,463 5,376,944 301,655 197,912,062 (1,542,362) (9,660,742)
	193,247,740	186,708,958

27. net sales

27.1 All revenue earned by the Company is Shariah Compliant.

(Amounts in thousand)

28. cost of sales

2025 .......Rupees....... 2024

cost of sales	2025.......Rup	ees.......2024
Cost of sales - Manufactured products Raw materials consumed Salaries, wages and staff welfare (note 28.1) Fuel and power Repairs and maintenance Depreciation (note 4.2) Amortisation (note 5.3) Consumable stores Training, HSE and other related expenses Purchased services Travelling Communication, stationery and other office expenses Insurance Rent, rates and taxes Other expenses Manufacturing cost Add: Opening stock of work in process Less: Closing stock of work in process (note 10) Cost of goods manufactured Add: Opening stock of finished goods Less: Closing stock of finished goods (note 10)
	82,028,878 4,030,040 22,983,869 3,224,992 4,456,352 61,433 2,725,617 1,473,634 1,545,290 135,381 52,109 1,289,009 3,747 1,642	88,940,369 3,963,232 21,527,504 6,974,954 3,698,179 39,924 2,106,094 1,325,938 1,263,032 185,689 45,632 1,332,680 34,229 5,263
	124,011,993 44,113 (269,136)	131,442,719 279,974 (44,113)
	123,786,970 6,887,648 (5,776,028)	131,678,580 740,739 (6,887,648)
	124,898,590	125,531,671

28.1 Salaries, wages and staff welfare includes Rs. 240,567 (2024: Rs. 241,639) in respect of staff retirement benefits.

selling and distribution expenses Salaries, wages and staff welfare (note 29.1) Training, HSE and other related expenses Product transportation and handling Fuel for product transportation Royalty (note 29.2) Repairs and maintenance Advertising and marketing Rent, rates and taxes Communication, stationery and other office expenses Travelling Depreciation (note 4.2) Amortisation (note 5.3) Purchased services Insurance Others	2025.......Rupees.......2024 1,751,407 1,463,231 259,188 204,306 7,636,648 5,655,107 3,989,578 3,679,075 3,315,473 3,016,514 50,606 35,565 354,340 469,669 1,321,800 755,529 23,323 19,075 246,078 316,410 165,166 149,243 565 15,219 155,938 134,067 10,391 11,575 122,419 25,324	2025.......Rupees.......2024 1,751,407 1,463,231 259,188 204,306 7,636,648 5,655,107 3,989,578 3,679,075 3,315,473 3,016,514 50,606 35,565 354,340 469,669 1,321,800 755,529 23,323 19,075 246,078 316,410 165,166 149,243 565 15,219 155,938 134,067 10,391 11,575 122,419 25,324
	19,402,920	15,949,909

29. selling and distribution expenses

rooted in 423 character driven leadership

rooted in character 424 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

(Amounts in thousand)

29.1 Salaries, wages and staff welfare includes Rs. 148,796 (2024: Rs. 121,568) in respect of staff retirement benefits.
29.2 Royalty is paid to the Holding Company which has its registered office at 19th floor, The Harbour Front Building, Plot Number HC-3, Block 4, Scheme Number 5, Clifton, Karachi.

30. administrative expenses

administrative expenses Salaries, wages and staff welfare (note 30.1) Training, HSE and other related expenses Repairs and maintenance Rent, rates and taxes Communication, stationery and other office expenses Travelling Depreciation (note 4.2) Amortisation (note 5.3) Purchased services Aircraft operating expense (note 30.2) Insurance Others	2025.......Rupees.......2024 967,030 932,158 126,868 72,553 4,735 6,070 337,645 276,186 8,746 25,974 84,590 65,025 385,876 371,076 185,620 185,542 2,134,725 1,931,514 379,331 285,015 89,317 56,954 16,339 82,807	2025.......Rupees.......2024 967,030 932,158 126,868 72,553 4,735 6,070 337,645 276,186 8,746 25,974 84,590 65,025 385,876 371,076 185,620 185,542 2,134,725 1,931,514 379,331 285,015 89,317 56,954 16,339 82,807
	4,720,822	4,290,874

30.1 Salaries, wages and staff welfare includes Rs. 48,768 (2024: Rs. 48,912) in respect of staff retirement benefits.
30.2 This is net of recoveries from group companies.

31. other income

other income On financial assets Income on working capital loan to subsidiary Income on loan to Parent Company Income on government securities, term deposit receipts, mutual fund units and bank deposits (note 31.2) Dividend income (notes 31.3 and 45.3) On non-financial assets Commission income (notes 31.1, 31.3 and 45.3) Scrap sales (note 31.3) Sub-licensing income from subsidiary (notes 31.3 and 45.3) Gain on disposal of operating assets (note 31.3) Reversal of provision for impairment against trade debts - net Others	2025.......Rupees.......2024 1,574,226 1,527,264 929 - 641,785 2,222,757 885,000 5,750,000 3,101,940 9,500,021 628,450 988,714 400,785 95,008 36,800 28,504 1,069,601 - 2,756 31,020 132,040 149,323 2,270,432 1,292,569	2025.......Rupees.......2024 1,574,226 1,527,264 929 - 641,785 2,222,757 885,000 5,750,000 3,101,940 9,500,021 628,450 988,714 400,785 95,008 36,800 28,504 1,069,601 - 2,756 31,020 132,040 149,323 2,270,432 1,292,569
	5,372,372	10,792,590

31.1 Represents commission earned as a selling agent of imported fertilizer on behalf of EAPL, a subsidiary company.

(Amounts in thousand)

31.2 It includes profit earned on Shariah Compliant bank deposits and units of Shariah Compliant mutual funds amounting to Rs. 21,501 (2024: Rs. 183,531).
31.3 These represents Shariah Compliant income.

other operating expenses Workers' profits participation fund Workers' welfare fund Donations (notes 32.1 and 32.1.1) Legal and professional Directors' fees (note 39.1) Auditor's remuneration (note 32.3) Loss on disposal of operating assets Others (note 32.2)	2025.......Rupees.......2024 2,091,542 2,358,934 1,148,091 815,753 402,895 463,819 126,825 94,969 7,070 14,419 28,721 30,842 - 191,072 628,899 160,793	2025.......Rupees.......2024 2,091,542 2,358,934 1,148,091 815,753 402,895 463,819 126,825 94,969 7,070 14,419 28,721 30,842 - 191,072 628,899 160,793
	4,434,043	4,130,601

32. other operating expenses

32.1 During the year, the Company made the donations to Engro Foundation amounting to Rs. 353,687 (2024: Rs. 396,000). Mr. Ahsan Zafar Syed, Director of the Company, is also the trustee of Engro Foundation.
32.1.1 This also includes an amount of Rs. 49,208 (2024: Rs. 67,819) recharged by the Holding Company for operational expenditure of Engro Foundation.
32.2 This includes the allocation of gain on disposal of aircraft as per the cost sharing agreement with associated undertakings amounting to Rs. 555,501 (2024: Nil).

32.3 Auditors' remuneration

Fee for: - audit of annual financial statements - review of half yearly financial information - review of compliance with the Code of Corporate Governance - certifications and other advisory services - taxation services Reimbursement of expenses 33. finance cost Interest / mark-up / return on: - long-term borrowings under: - interest / mark-up arrangements (note 33.1 note 33.2) - Shariah permissible arrangements - short term borrowings under: - interest / mark-up arrangements - Shariah permissible arrangements Foreign exchange gain	2025.......Rupees.......2024 5,700 4,817 1,200 970 450 88 1,647 3,906 17,655 18,961 2,069 2,100	2025.......Rupees.......2024 5,700 4,817 1,200 970 450 88 1,647 3,906 17,655 18,961 2,069 2,100
	28,721	30,842
	2025.......Rupees.......2024 1,262,763 887,593 1,518,904 - 2,781,667 887,593 1,142,289 2,305,666 2,126,273 815,534 3,268,562 3,121,200 - (26,958)
	6,050,229	3,981,835

33.1 This is net of government grant income on TERF loans amounting to Rs. 202,737 (2024: Rs. 239,997) (note 20).
33.2 This is net of recoveries from group companies in respect of finance cost charged for the use of aircraft.

rooted in 425 character driven leadership

rooted in character 426 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

34. gain on subsidy receivable from gop

This represents gain recognised on Subsidy receivable from the GoP (note 12.3) in accordance with the 'Expected Credit Loss' model under IFRS 9, giving consideration to the time value of money based on expected recovery of subsidy receivable. The Company, is confident of full recovery of the subsidy amount from the GoP.

taxation

35.

taxation Current - for the year - for prior years (note 35.1) Deferred (note 21)	2025.......Rupees.......2024 14,775,599 15,877,204 3,113,530 7,276,689	2025.......Rupees.......2024 14,775,599 15,877,204 3,113,530 7,276,689
	17,889,129 (1,921,441)	23,153,893 (8,540,909)
	15,967,688	14,612,984

The Company continually evaluates its tax position based on amendments by the taxation authorities and developments thereon. Adequate provision in this respect is being maintained in these financial statements without prejudice to the tax proceedings before any appellate / judicial forum and admission of any liability in this respect. Matters where there is a difference between the position taken by taxation authorities and the Company’s own position based on its assessment of law and in accordance with its legal / tax consultant's opinion, such matters are being reported as contingent liabilities. Please refer note 26 in this respect.

35.1 In accordance with the provisions of sections 4B and 4C of the Ordinance, super tax had been levied on the Company for tax years 2015 to 2019 and from tax year 2022 onwards, respectively. These enactments were challenged by the Company in the SHC and afterwards by the FBR in the SCP. During the year, in accordance with the 27th Constitutional Amendment, all pending litigations of sections 4B and 4C of the Ordinance were called from all High Courts and SCP in the Federal Constitutional Court (FCC). Subsequent to the year end, the FCC decided on the matters and has upheld the constitutionality of sections 4B and 4C of the Ordinance.

In respect of the same, the Company has recognised adequate provision against additional super tax levy of six percent for TY 2022.

35.2 Relationship between tax expense and accounting profit

The tax on the Company's profit before tax differs from the theoretical amount that would arise using the Company's applicable tax rate as follows:

Profit before taxation Tax calculated at the rate of 29% (2024: 29%) Tax effect of: - Expenses / income not allowed for tax - Final / Special Tax Regime and exempt income & others Super tax Effect of prior year tax charge (note 35.3) Tax charge for the year	2025.......Rupees.......2024 39,738,223 44,819,746	2025.......Rupees.......2024 39,738,223 44,819,746
	11,524,085 (319,434) (253,794) 3,763,517 1,253,314	12,997,726 (332,849) (1,683,833) 3,814,381 (182,441)
	15,967,688	14,612,984

(Amounts in thousand)

36. earnings per share (eps)

36.1 Basic EPS has been calculated by dividing the profit attributable to equity holders of the Company by weighted average number of ordinary shares in issue during the year.
36.2 As at December 31, 2025, there is no dilutive effect on the basic earnings per share of the Company. EPS is based on the following:

Profit for the year Weighted average number of ordinary shares (in thousands) 37. financing structure / mode Conventional mode: Assets Short-term investments Long-term investments Cash and bank balances Working capital loan to subsidiary Liabilities Borrowings Short-term borrowings Shariah compliant mode: Assets Short-term investments Cash and bank balances Liabilities Borrowings Short-term borrowings	2025.......Rupees.......2024 23,770,535 30,206,762	2025.......Rupees.......2024 23,770,535 30,206,762
	.......Numbers of shares....... 1,335,299 1,335,299
	2025.......Rupees.......2024 8,454,607 2,738,400 3,597,740 3,517,074 7,771,708 3,622,859 20,998,123 11,902,310
	40,822,178	21,780,643
	19,657,545 1,602,297	8,535,721 7,318,211
	21,259,842	15,853,932
	6,608,243 177,589	1,011 638,586
	6,785,832	639,597
	24,250,000 21,420,426	13,000,000 5,133,411
	45,670,426	18,133,411

37.1 The maximum aggregate amount of working capital loan to subsidiary outstanding at the end of any month was Rs. 29,371,274 (2024: Rs. 15,154,437).
35.3 This is net of the corresponding deferred tax impact.

rooted in 427 character driven leadership

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engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

38. shariah compliance disclosure

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|||||||||
|---|---|---|---|---|---|---|---|
|2025|2024|
|Note|Conventional|Shariah|Total|Conventional|Shariah|Total|
|Compliant|Compliant|
|--------------Rupees--------------|--------------Rupees--------------|
|Statement of Financial Position|
|Borrowings|19|19,657,545|24,250,000|43,907,545|8,535,721|13,000,000|21,535,721|
|Short-term borrowings|25|1,602,297|21,420,426|23,022,723|7,318,211|5,133,411|12,451,622|
|Accrued interest / mark-up|663,146|738,002|1,401,148|945,574|245,777|1,191,351|
|Investment in susbsidiary|6|100|-|100|100|-|100|
|Long-term investments|7|3,597,740|-|3,597,740|3,517,074|-|3,517,074|
|Short-term investments|15|8,454,607|6,608,243|15,062,850|2,738,400|1,011|2,739,411|
|Accrued income|874,728|-|874,728|764,816|110|764,926|
|Cash and bank balances|16|7,771,708|177,589|7,949,297|3,622,859|638,586|4,261,445|
|Statement of profit or loss|
|Net sales|27|- 193,247,740 193,247,740|- 186,708,958 186,708,958|
|Other income|31|2,330,235|3,042,137|5,372,372|3,746,833|7,045,757|10,792,590|
|Finance cost|33|2,405,052|3,645,177|6,050,229|3,166,301|815,534|3,981,835|

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39. remuneration of chief executive, directors and executives

39.1 The aggregate amounts for remuneration, including all benefits, to the chief executive, directors and executives of the Company are given below:

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||||||||
|---|---|---|---|---|---|---|
|2025|2024|
|Directors|Executives|Directors|Executives|
|Chief|Others|Chief|Others|
|Executive|Executive|
|----------------------------------------------Rupees----------------------------------------------|
|Managerial remuneration|
|including bonus|99,864|-|4,342,838|117,536|-|3,894,028|
|Staff retirement benefits|7,132|-|394,390|5,630|-|345,214|
|Other benefits|86|-|77,532|1,909|-|74,197|
|Fees|-|7,070|-|-|14,419|-|
|Total|107,082|7,070|4,814,760|125,075|14,419|4,313,439|
|Number of persons, including those|
|who worked part of the year|1|10|709|2|9|626|

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39.2 These amounts are net off salaries, wages and other staff benefits incurred on behalf of EAPL and subsequently charged to EAPL.

(Amounts in thousand)

40. retirement and other service benefits

40.1 Salient features

The Company offers a defined post-employment gratuity benefit to permanent management and non-management employees. In addition, until June 30, 2005, the Company offered a defined post-employment pension

benefit to management employees in service which has been discontinued and the plan now only covers a handful of retired pensioners.

The gratuity and pension funds are governed under the Trusts Act, 1882, Trust Deed and the Rules of the ��

Responsibility for governance of plan, including investment decisions and contribution schedule lie with the Board of Trustees of the funds.

The Company faces the following risks on account of gratuity and pension funds

Final salary risks - The risk that final salary at the time of cessation of service is greater than what was assumed. Since the benefit is calculated on the final salary, the benefit amount would also increase proportionately.
Asset volatility - Most assets are invested in risk free investments of 3, 5 or 10 year Special Saving Certificates, Regular Income Certificates, Defence Saving Certificates or Government Bonds. However, . investments in equity instruments are subject to adverse fluctuations as a result of change in the market price.

Investment risks - The risk of investment underperforming and not being sufficient to meet the liabilities.This risk is mitigated by closely monitoring the performance of investments.
Risk of insufficiency of assets - This is managed by making regular contribution to the funds as advised by the actuary.
In addition to above, the pension fund exposes the Company to Longevity risk i.e. the pensioners survivelonger than expected.
40.2 Valuation results
39.3 The Company also provides vehicles and certain household items for use of some executives and directors.
39.4 Premium charged in respect of directors' indemnity insurance policy, purchased by the Company during the year, amounted to Rs. 246 (2024: Rs. 301).

The latest actuarial valuation of the defined benefit plans was carried out as at December 31, 2025, using the Projected Unit Credit Method. Details of the defined benefit plans are as follows:

rooted in 429 character driven leadership

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engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

	--------------------------------Rupees-------------------------------- NMPT MPT 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) 2025 2024	--------------------------------Rupees-------------------------------- NMPT MPT 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) 2025 2024	--------------------------------Rupees-------------------------------- NMPT MPT 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) 2025 2024	--------------------------------Rupees-------------------------------- NMPT MPT 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) 2025 2024	--------------------------------Rupees-------------------------------- NMPT MPT 2025 2024 2025 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) 2025 2024
538,121 (363,088)	496,642 (324,178)	34,115 (63,547)	33,044 (55,587)	51,314 (38,887)	53,398 (40,752)
175,033	172,464	(29,432)	(22,543)	12,427	12,646

172,464 46,913 (44,344)	136,158 42,883 (6,577)	(22,543) (1,541) (5,348)	(25,988) (2,538) 5,983	12,646 1,462 (1,681)	16,898 2,510 (6,762)
175,033	172,464	(29,432)	(22,543)	12,427	12,646

40.2.1 Statement of financial position

reconciliation

Present value of obligation (note 40.2.3) Fair value of plan assets (note 40.2.4) Net liability / (asset) at end of the year

40.2.2 Movement in net liability / (asset) recognised

Net liability / (asset) at beginning of the year Charge / (reversal) for the year (note 40.2.5) Remeasurements charged to OCI (note 40.2.7) Net liability / (asset) at end of the year

40.2.3 Movement in defined benefit obligation

496,642 25,987 61,186 (20,277) (25,417)	392,565 21,322 62,967 (17,669) 37,457	33,044 1,110 4,090 - (4,129)	75,411 1,826 8,295 (46,582) (5,906)	53,398 - 6,196 (5,262) (3,018)	57,602 - 9,096 (5,180) (8,120)
538,121	496,642	34,115	33,044	51,314	53,398

324,178 40,260 (20,277) 18,927	256,407 41,406 (17,669) 44,034	55,587 6,741 - 1,219	101,399 12,659 (46,582) (11,889)	40,752 4,734 (5,262) (1,337)	40,704 6,586 (5,180) (1,358)
363,088	324,178	63,547	55,587	38,887	40,752

25,987 20,926	21,322 21,561	1,110 (2,651)	1,826 (4,364)	- 1,462	- 2,510
46,913	42,883	(1,541)	(2,538)	1,462	2,510

59,388	65,458	8,029	490	3,397	5,228

NMPT MPT Defined Benefit Gratuity Plans - Funded		Defined Benefit Pension Plan - Funded (Curtailed)
2025 2024 2025 2024 2025 2024 -------------------------------------Rupees------------------------------------- 40.2.7 Remeasurements recognised in the Statement of Comprehensive Income (Gain) / loss from change in experience assumptions (Gain) / loss from change in financial assumptions Remeasurement of obligation Expected return on plan assets (note 40.2.4) Actual return on plan assets (note 40.2.6) Difference in fair value opening Remeasurement of plan assets (24,925) (492) (25,417) 40,260 (59,388) 201 (18,927) 38,850 (1,393) 37,457 41,406 (65,458) (19,982) (44,034) (4,129) - (4,129) 6,741 (8,029) 69 (1,219) (5,906) - (5,906) 12,659 (490) (280) 11,889 (3,018) - (3,018) 4,734 (3,397) - 1,337 (8,120) - (8,120) 6,586 (5,228) - 1,358
(44,344) (6,577) (5,348) 5,983		(1,681) (6,762)
40.2.8 Principal actuarial assumptions used in the actuarial valuation Discount rate Expected per annum rate of return on plan assets Expected per annum rate of increase in salaries - next year Expected per annum rate of increase in salaries - long term 40.2.9 Demographic assumptions Mortality rate Rate of employee turnover 11.00% 11.00% 10.00% 10.00% 12.25% 12.25% 11.25% 11.25% 11.00% 11.00% 11.00% 11.00% 12.25% 12.25% 12.25% 12.25% SLIC (2001-05) - I Light SLIC (2001-05) - I Heavy		11.00% 11.00% - - 12.25% 12.25% - - SLIC (2001-05) - I -

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(Amounts in thousand)

40.2.10 Sensitivity Analysis

The impact of 1% change in following variables on defined benefit obligation is as follows:

Discount rate Long term salary increases Long term pension increases Discount rate Long term salary increases Long term pension increases 40.2.11 Maturity Profile Time in Years 1 2 3 4 5-10 11-15 16-20 20+ Weighted average duration (years)	Increase in assumption Decrease in assumption 2025	Increase in assumption Decrease in assumption 2025
	---------------------------------Rupees--------------------------------- Gratuity Plans Gratuity Plans MPT Pension Plan Pension Plan MPT NMPT NMPT Increase in assumption Decrease in assumption 2024 497,027 584,852 - 33,689 34,549 - 48,280 - 54,675 584,852 496,320 - 34,553 33,685 - 54,707 - 48,254
	---------------------------------Rupees--------------------------------- Gratuity Plans Gratuity Plans MPT Pension Plan Pension Plan MPT NMPT NMPT 456,675 542,238 - 32,369 33,736 - 50,108 - 57,055 542,238 455,997 - 35,178 46,109 23,380 56,700 471,080 563,932 745,753 1,707,454 7.64 33,736 32,363 - 19,603 5,367 10,914 5,982 - - - - 1.25 57,089 - 50,080 4,715 4,266 3,828 3,405 12,835 3,838 1,086 429 5.91 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2025
		542,238 455,997 - 33,736 32,363 - 57,089 - 50,080
		2025
		35,178 46,109 23,380 56,700 471,080 563,932 745,753 1,707,454 7.64 19,603 5,367 10,914 5,982 - - - - 1.25 4,715 4,266 3,828 3,405 12,835 3,838 1,086 429 5.91 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT

20,139 37,378 48,648 25,043 439,948 641,253 838,640 2,519,956 8.05 937 21,843 6,049 11,926 6,609 - - - 2.04 4,713 4,262 3,823 3,399 12,792 3,816 1,080 429 6.16 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024 Rupees % Rupees % Rupees % 256,411 86,463 20,214 363,088 83 12 5 100 46,191 16,265 1,091 63,547 72 26 2 100 - - 38,887 38,887 - - 100 100 NMPT MPT 2025 2025 2025 2025 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) Rupees % Rupees % Rupees % NMPT MPT 2024 2024 2024 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed)** 270,439 38,412 15,327 324,178 83 12 5 100 42,235 - 13,352 55,587 76 - 24 100 - - 40,752 40,752 - - 100 100	20,139 37,378 48,648 25,043 439,948 641,253 838,640 2,519,956 8.05 937 21,843 6,049 11,926 6,609 - - - 2.04 4,713 4,262 3,823 3,399 12,792 3,816 1,080 429 6.16 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024 Rupees % Rupees % Rupees % 256,411 86,463 20,214 363,088 83 12 5 100 46,191 16,265 1,091 63,547 72 26 2 100 - - 38,887 38,887 - - 100 100 NMPT MPT 2025 2025 2025 2025 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) Rupees % Rupees % Rupees % NMPT MPT 2024 2024 2024 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed)** 270,439 38,412 15,327 324,178 83 12 5 100 42,235 - 13,352 55,587 76 - 24 100 - - 40,752 40,752 - - 100 100	20,139 37,378 48,648 25,043 439,948 641,253 838,640 2,519,956 8.05 937 21,843 6,049 11,926 6,609 - - - 2.04 4,713 4,262 3,823 3,399 12,792 3,816 1,080 429 6.16 --------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024 Rupees % Rupees % Rupees % 256,411 86,463 20,214 363,088 83 12 5 100 46,191 16,265 1,091 63,547 72 26 2 100 - - 38,887 38,887 - - 100 100 NMPT MPT 2025 2025 2025 2025 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed) Rupees % Rupees % Rupees % NMPT MPT 2024 2024 2024 2024 Defined Benefit Gratuity Plans - Funded Defined Benefit Pension Plan - Funded (Curtailed)** 270,439 38,412 15,327 324,178 83 12 5 100 42,235 - 13,352 55,587 76 - 24 100 - - 40,752 40,752 - - 100 100	--------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024	--------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024	--------------Rupees-------------- Gratuity Plans Pension Plan MPT NMPT 2024
			20,139 37,378 48,648 25,043 439,948 641,253 838,640 2,519,956 8.05	937 21,843 6,049 11,926 6,609 - - - 2.04 4,713 4,262 3,823 3,399 12,792 3,816 1,080 429 6.16
				Rupees % - - 38,887 38,887 - - 100 100 2025 Defined Benefit Pension Plan - Funded (Curtailed) Rupees % 2024 Defined Benefit Pension Plan - Funded (Curtailed) - - 40,752 40,752 - - 100 100
Defined Benefit Gratuity Plans - Funded
NMPT		MPT*
2025		2025
Rupees	%	Rupees	%	Rupees
256,411 86,463 20,214	83 12 5	46,191 16,265 1,091	72 26 2	- - 38,887	- - 100
363,088	100	63,547	100	38,887	100

Defined Benefit Gratuity Plans - Funded
NMPT		MPT*
2024		2024
Rupees	%	Rupees	%	Rupees
270,439 38,412 15,327	83 12 5	42,235 - 13,352	76 - 24	- - 40,752	- - 100
324,178	100	55,587	100	40,752	100

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annual report 2025

(Amounts in thousand)

The employees of the Company in respect of gratuity are members of Defined Benefit Gratuity Fund maintained and operated by the Holding Company. Accordingly, the above information is based upon the plan assets of Engro Corporation Limited Gratuity Fund.
40.2.13 The expected return on plan assets was determined by considering the expected returns available on the assets underlying the current investment policy. Expected yields on fixed income investments are based on gross redemption yields as at the reporting date.

40.2.14 Expected future cost / (reversal) for the year ending December 31, 2026 is as follows:

- Gratuity Fund - NMPT - Gratuity Fund - MPT - Pension Fund	Rupees 45,749
	(2,211)
	1,298

40.2.15 Historical information of staff retirement benefits:

---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021	---------------------------------Rupees--------------------------------- 2025 2024 2023 2022 2021
538,121 (363,088)	496,642 (324,178) 392,565 (256,407) 349,731 (222,668) 311,658 (214,650)
175,033	172,464 136,158	127,063	97,008

34,115 (63,547)	33,044 (55,587) 75,411 (101,399) 90,524 (113,128) 72,202 (106,426)
(29,432)	(22,543) (25,988)	(22,604)	(34,224)

51,314 (38,887)	53,398 (40,752) 57,602 (40,704) 19,103 (43,900) 22,324 (42,821)
12,427	12,646 16,898	(24,797)	(20,497)

40.3 Defined contribution plans

An amount of Rs. 429,121 (2024: Rs. 355,366) has been charged during the year in respect of defined contribution plans maintained by the Holding Company.

(Amounts in thousand)

41. cash generated from operations Profit before taxation Adjustment for non-cash charges and other items: Depreciation (note 4.2) Amortisation of intangibles (note 5.3) Amortisation of deferred income (Gain) / Loss on disposal of operating assets Provision for retirement and other service benefits Income on deposits / other financial assets Finance cost Dividend income (note 31) Provision against stock-in-trade (note 10.1) Stock-in-trade directly written off (note 10.2) Provision for surplus and slow moving stores and spares (note 9.1) Stores, spares and loose tools directly written off (note 9.2) Reversal of provision against stores, spares and loose tools (note 9.1) Reversal for impairment against trade debts (note 11.2) Gain on subsidy receivable from the GoP (note 12.3) Working capital changes (note 41.1) 41.1 Working capital changes (Increase) / decrease in current assets - Stores, spares and loose tools - Stock-in-trade - Trade debts - Loans, advances, deposits and prepayments - Other receivables (net) (Decrease) / increase in current liabilities Trade and other payables 42. cash and cash equivalents Cash and bank balances (note 16) Short-term investments (note 15) Short-term borrowings	39,738,223 5,007,394 247,618 (3,865) (1,069,601) 438,131 (2,216,940) 6,050,229 (885,000) - 39,555 304,923 3,811 (55,668) (39,088) (624,715) 4,434,273 51,369,280 (1,164,609) 1,080,217 (8,473,802) 1,036,055 4,436,289 (3,085,850) 7,520,123 7,520,123 4,434,273 7,949,297 250,000 (3,022,723) 5,176,574 2025.......Rupees.......2024 44,819,746 4,218,498 240,685 (3,865) 191,072 412,119 (3,750,021) 4,008,793 (5,750,000) 192,441 79,061 309,397 968 (118,540) (31,020) (1,203,088) (12,194,805) 31,421,441 298,171 (7,112,013) (3,587,155) (725,327) 5,001,346 (6,124,978) (6,069,827) (6,069,827) (12,194,805) 4,261,445 250,000 (7,951,622) (3,440,177)	39,738,223 5,007,394 247,618 (3,865) (1,069,601) 438,131 (2,216,940) 6,050,229 (885,000) - 39,555 304,923 3,811 (55,668) (39,088) (624,715) 4,434,273 51,369,280 (1,164,609) 1,080,217 (8,473,802) 1,036,055 4,436,289 (3,085,850) 7,520,123 7,520,123 4,434,273 7,949,297 250,000 (3,022,723) 5,176,574 2025.......Rupees.......2024 44,819,746 4,218,498 240,685 (3,865) 191,072 412,119 (3,750,021) 4,008,793 (5,750,000) 192,441 79,061 309,397 968 (118,540) (31,020) (1,203,088) (12,194,805) 31,421,441 298,171 (7,112,013) (3,587,155) (725,327) 5,001,346 (6,124,978) (6,069,827) (6,069,827) (12,194,805) 4,261,445 250,000 (7,951,622) (3,440,177)
		44,819,746 4,218,498 240,685 (3,865) 191,072 412,119 (3,750,021) 4,008,793 (5,750,000) 192,441 79,061 309,397 968 (118,540) (31,020) (1,203,088) (12,194,805)
		31,421,441

		298,171 (7,112,013) (3,587,155) (725,327) 5,001,346
		(6,124,978) (6,069,827)
		(6,069,827)
		(12,194,805)

		4,261,445 250,000 (7,951,622)
		(3,440,177)

rooted in 435 character driven leadership

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(Amounts in thousand)

43. financial instruments by category

financial instruments by category Financial assets at amortised cost Long-term investments Loans, advances and deposits Trade debts Working capital loan to subsidiary Other receivables Accrued income Short term investments Cash and bank balances Financial assets at fair value through profit or loss Short-term investments Financial liabilities at amortised cost Borrowings Government grant Trade and other payables Accrued interest / mark-up Short-term borrowings	3,597,740 1,161,619 14,201,307 20,998,123 3,725,373 874,728 250,000 7,949,297 52,758,187 14,812,850 43,907,545 514,355 61,406,608 1,401,148 23,022,723 130,252,379 3,517,074 1,434,785 5,687,349 11,902,310 6,255,209 764,926 250,000 4,261,445 34,073,098 2,489,411 21,535,721 717,092 54,738,010 1,191,351 12,451,622 90,633,796 2025.......Rupees.......2024	3,597,740 1,161,619 14,201,307 20,998,123 3,725,373 874,728 250,000 7,949,297 52,758,187 14,812,850 43,907,545 514,355 61,406,608 1,401,148 23,022,723 130,252,379 3,517,074 1,434,785 5,687,349 11,902,310 6,255,209 764,926 250,000 4,261,445 34,073,098 2,489,411 21,535,721 717,092 54,738,010 1,191,351 12,451,622 90,633,796 2025.......Rupees.......2024
		3,517,074 1,434,785 5,687,349 11,902,310 6,255,209 764,926 250,000 4,261,445
		34,073,098
		2,489,411
		21,535,721 717,092 54,738,010 1,191,351 12,451,622
		90,633,796

44. financial risk management

44.1 Financial risk factors

The Company's activities expose it to a variety of financial risks: market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk. The Company's overall risk management program focuses on having cost efficient funding as well as to manage financial risk to minimise earnings volatility and provide maximum return to shareholders.

Risk management is carried out by the Company's Finance and Planning department under policies approved by the Management Committee.

(Amounts in thousand)

As at December 31, 2025, if exchange rates had been 1% higher / lower with all other variables held constant, post tax profit for the year would have been lower / higher by Rs. 1,597 and (2024: higher / lower by Rs. 381).

ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company's interest rate risk arises from bank deposits, long-term and short term borrowings, and long term and short-term investments. These are benchmarked to variable rates which expose the Company to cash flow interest rate risk.

The Company analyses its interest rate exposure on a regular basis by monitoring interest rate trends to determine whether they should enter into hedging alternatives.

As at December 31, 2025, if interest rates had been 1% higher / lower with all other variables held constant, post tax profit for the year would have been lower / higher by Rs. 383,681 (2024: Rs. 159,742).

iii) Other price risk

Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk) whether those changes are caused by factors specific to the individual financial instruments or its issuer, or factors effecting all similar financial instruments traded in the market. The Company is exposed to price risk on its investments in units of mutual funds.

As at December 31, 2025, if net asset value had been 1% higher / lower with all other variables held constant, post tax profit for the year would have been higher / lower by Rs. 96,296 (2024: Rs. 17,605).

b) Credit risk

Credit risk represents the risk of financial loss being caused if counter party fails to discharge an obligation.

Credit risk arises from deposits with banks and financial institutions, trade debts, loans, advances, deposits, bank guarantees and other receivables. The credit risk on liquid funds is limited because the counter parties are banks with a reasonably high credit rating which in turn are deposited in banks and government securities. The Company having a minimum short term credit rating of A1 respectively. However, the Company maintains operational balances with certain banks of lower rating for the purpose of effective collection of bank guarantees and to cater to loan disbursements.

a) Market risk

i) Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

This exists due to the Company's exposure resulting from outstanding import payments and foreign currency bank accounts. A foreign exchange risk management policy has been developed and approved by the Board. The policy allows the Company to take currency exposure for limited periods within predefined limits while open exposures are rigorously monitored. The Company ensures to the extent possible that it has options available to manage exposure, either through forward contracts, options or prepayments, etc. subject to the prevailing foreign exchange regulations.

The Company is exposed to a concentration of credit risk on its trade debts by virtue of all its customers being agri-based businesses in Pakistan. However, this risk is mitigated by applying individual credit limits and by securing majority of trade debts against bank guarantees and inland letters of credit.

The Company monitors the credit quality of its financial assets with reference to historical performance of such assets and available external credit ratings. The carrying values of financial assets which are neither past due nor impaired are as under:

rooted in 437 character driven leadership

rooted in character 438 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

Long-term investments Loans, advances and deposits Trade debts Working capital loan to subsidiary Other receivables Accrued income Short-term investments Bank balance	2025.......Rupees.......2024 3,597,740 1,161,619 14,201,307 20,998,123 3,725,373 874,728 250,000 7,949,097 52,757,987 3,517 ,074 1,434,785 5,687,349 11,902,310 6,255,209 764,926 250,000 4,258,332 34,069,985	2025.......Rupees.......2024 3,597,740 1,161,619 14,201,307 20,998,123 3,725,373 874,728 250,000 7,949,097 52,757,987 3,517 ,074 1,434,785 5,687,349 11,902,310 6,255,209 764,926 250,000 4,258,332 34,069,985
		3,517 ,074 1,434,785 5,687,349 11,902,310 6,255,209 764,926 250,000 4,258,332
		34,069,985

The credit quality of receivables can be assessed with reference to their historical performance with no or negligible defaults in recent history. Investments in Pakistan Investment Bonds are government guaranteed. The credit quality of the Company's bank balances and short-term investments can be assessed with reference to recent external credit ratings as follows:

Conventional
- Allied Bank Limited
- Askari Bank Limited
- Bank Alfalah Limited
- Bank Al Habib Limited
- The Bank of Punjab
- Citibank N.A.
- Habib Bank Limited
- Habib Metropolitan Bank Limited
- Industrial and Commercial Bank of China
- JS Bank Limited
- MCB Bank Limited
- National Bank of Pakistan
- Samba Bank Limited
- Soneri Bank Limited
- Standard Chartered Bank (Pakistan) Limited
- United Bank Limited
PACRA
PACRA
PACRA
PACRA
PACRA
MOODY'S
JCR-VIS
PACRA
FITCH
PACRA
PACRA
PACRA
PACRA
PACRA
PACRA
JCR-VIS
Rating
agency

Rating

A1+
A1+
A1+
A1+
A1+
P1
A1+
A1+
F1+
A1+
A1+
A1+
A1+
A1+
A1+
A1+
AAA
AA+
AAA
AAA
AA+
Aa3
AAA
AA+
A
AA
AAA
AAA
AA
AA-
AAA
AAA
Short term
Long term

Islamic - BankIslami Pakistan Limited - Al Baraka Bank (Pakistan) Limited - Faysal Bank Limited - Habib Bank Limited - MCB Islamic Bank Limited - Meezan Bank Limited - Bank Makramah Limied PACRA JCR-VIS JCR-VIS JCR-VIS PACRA JCR-VIS JCR-VIS Rating agency	Rating
	A1 A1 A1+ A1+ A1 A1+ - AA- AA- AA AAA A+ AAA B Short term Long term

c)

Liquidity risk

Liquidity risk represents the risk that the Company will encounter difficulties in meeting obligations associated with financial liabilities.

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities. Due to dynamic nature of the business, the Company maintains flexibility in funding by maintaining committed credit lines available.

The Company's liquidity management involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring statement of financial position liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

The table below analyses the Company's financial liabilities into relevant maturity groupings based on remaining period at the reporting date to contractual maturity dates. The amounts disclosed in the table are the contractual undiscounted cash flows.

2025	2025	2025	2024	2024	2024
-------------------------------------------------Rupees------------------------------------------------- Maturity upto one year Maturity after one year Total Maturity upto one year Maturity after one year Total
17,830,037 61,406,608 1,401,148 23,022,723	32,375,929 - - -	50,205,966 61,406,608 1,401,148 23,022,723	4,695,766 54,738,010 1,191,351 12,451,622	23,798,149 - - -	28,493,915 54,738,010 1,191,351 12,451,622
103,660,516	32,375,929	136,036,445	73,076,749	23,798,149	96,874,898

44.2 Capital risk management

The Company's objective when managing capital are to safeguard the Company's ability to continue as a going concern in order to provide returns for shareholders and benefit for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions. To maintain or adjust the capital structure, the Company may adjust dividend payment to shareholders or issue new shares. The gearing ratio of the Company is calculated as borrowings divided by total capital. Total capital is calculated as equity as shown in the statement of financial position plus borrowings.

Borrowings Total Equity Total Capital Debt to Equity Ratio % Note 19	2025.......Rupees.......2024	2025.......Rupees.......2024
	43,907,545 44,959,842	21,535,721 46,528,657
	88,867,387	68,064,378
	49:51	32:68

The Company finances its operations through equity, borrowings and management of working capital with a view to maintaining an appropriate mix between various sources of finance to minimise risk.

rooted in 439 character driven leadership

rooted in character 440 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

(Amounts in thousand)

44.3 Fair value estimation

The Company classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

Quoted prices (unadjusted) in active markets for identical assets or liabilities (level1);
Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (level 2); and
Inputs for the asset or liability that are not based on observable market data (level 3).

The table below analyses financial instruments carried at fair value by valuation method.

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Represents investment in units of mutual funds that are measured at fair value using the fund's respective net asset value.

There were no transfers between the levels of hierarchy during the year.

44.4 Fair value of financial assets and liabilities

45. transactions with related parties

Following are the names of associated companies and undertakings and other related parties with whom the Company had entered into transactions or had agreements and / or arrangements in place during the year:
45.1

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||||
|---|---|---|
|Name of Related parties|Direct shareholding|Relationship|
|Engro Corporation Limited|56.27%|Holding Company|
|EFERT Agritrade (Private) Limited|100%|Subsidiary Company|
|Engro Eximp FZE|N/A|Subsidiary of Holding Company|
|Engro Elengy Terminal (Private) Limited|N/A|Associate of Holding Company|
|Elengy Terminal Pakistan Limited|N/A|Subsidiary of Holding Company|
|Engro Energy Limited|N/A|Subsidiary of Holding Company|
|Engro Polymer and Chemicals Limited|N/A|Subsidiary of Holding Company|
|Engro Peroxide (Private) Limited|N/A|Subsidiary of Holding Company|
|Think PVC (Private) Limited|N/A|Subsidiary of Holding Company|
|Engro LNG FZE|N/A|Subsidiary of Holding Company|
|Engro Powergen Thar (Private) Limited|N/A|Subsidiary of Holding Company|
|Engro Enfrashare (Private) Limited|N/A|Subsidiary of Holding Company|
|Engro Connect (Private) Limited|N/A|Subsidiary of Holding Company|
|Engro Technical Solutions (Private) Limited|N/A|Subsidiary of Holding Company|
|FrieslandCampina Engro Pakistan Limited|N/A|Associate of Holding Company|
|Engro Energy Services Limited|N/A|Associate of Holding Company|
|Engro Foundation|N/A|Associate of Holding Company|
|Engro Vopak Terminal Limited|N/A|Associate of Holding Company|
|Sindh Engro Coal Mining Company Limited|N/A|Associate of Holding Company|
|Unilever Pakistan Foods Limited|N/A|Common Directorship|
|Engro Power International Holding BV|N/A|Common Directorship|
|Engro Power Investments International BV|N/A|Common Directorship|
|Engro Power Services Holding BV|N/A|Common Directorship|
|Engro Power Services Limited (Nigeria)|N/A|Common Directorship|
|Karachi Education Initiative|N/A|Common Directorship|
|EngroTech Ventures-FZCO|N/A|Common Directorship|
|Engro Engineering and consulting LLC (SPC) Abu Dhabi|N/A|Common Directorship|
|Dawood Foundation|N/A|Common Directorship|
|Pakistan Oxygen Limited|N/A|Common Directorship|
|Shabbir Tiles & Ceramics Limited|N/A|Common Directorship|
|National Clearing Company of Pakistan Limited|N/A|Common Directorship|
|Pakistan Broadcasting Corporation|N/A|Common Directorship|
|Thar Power Company Limited|N/A|Common Directorship|

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The carrying value of all other financial assets and liabilities reflected in these financial statements approximate their fair values.

rooted in 441 character driven leadership

rooted in character 442 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

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||||
|---|---|---|
|Name of Related parties|Direct shareholding|Relationship|
|Ahsan Zafar Syed|N/A|Director|
|Ali Rathore|N/A|Chief Executive Officer|
|Javed Akbar|N/A|Ex - Director|
|Asim Murtaza Khan|N/A|Ex - Director|
|Danish Zuberi|N/A|Ex - Director|
|Ahmad Shakoor|N/A|Director|
|Farooq Barkat Ali|N/A|Director|
|Asad Said Jafar|N/A|Director|
|Mohammad Younus Dagha|N/A|Director|
|Rizwan Khalil Sheikh|N/A|Director|
|Sadia Khan|N/A|Director|
|Aneeq Ahmad|N/A|Key Management Personnel|
|Nazia Ali|N/A|Key Management Personnel|
|Farrukh Saeed Khan|N/A|Key Management Personnel|
|Muhammad Majid Latif|N/A|Key Management Personnel|
|Khawaja Bilal Mustafa|N/A|Key Management Personnel|
|Atif Muhammad Ali|N/A|Key Management Personnel|
|Muhammad Imran Khalil|N/A|Key Management Personnel|
|Kalim Uddin A. Khan|N/A|Key Management Personnel|
|FrieslandCampina Engro Pakistan Limited|
|Employees Gratuity Fund|N/A|Post Employment Benefits|
|Engro Corporation Limited DC Pension Fund|N/A|Post Employment Benefits|
|Engro Corporation Limited MPT Gratuity Fund|N/A|Post Employment Benefits|
|Engro Corporation Limited NMPT Gratuity Fund|N/A|Post Employment Benefits|
|Engro Fertilizers Limited NMPT Gratuity Fund|N/A|Post Employment Benefits|
|Engro Corporation Limited DB Pension Fund|N/A|Post Employment Benefits|
|Engro Corporation Limited DC Gratuity Fund|N/A|Post Employment Benefits|
|Engro Corporation Limited Provident Fund|N/A|Post Employment Benefits|

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45.2 Following are the names of related parties incorporated outside Pakistan with whom the Company had entered into transactions or had agreements and arrangements in place during the year:

Name of Related Party Engro Eximp FZE

Country of incorporation

Registered Address BCW JAFZA 18 & 19, Office # 110, United Arab Emirates

United Arab Emirates

45.3

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||||
|---|---|---|
|Details of transactions with related parties during the year, other than those which have been disclosed|
|elsewhere in these financial statements, are as follows:|
|2025|.......Rupees.......|2024|
|Holding Company|
|Dividend paid|14,274,929|16,153,210|
|Mark-up paid / payable on subordinated loan|227,273|183,393|
|Mark-up received on working capital loan|929|-|
|Reimbursements made:|
|- by the Holding Company|528,151|414,611|
|- to the Holding Company|3,034,969|2,819,513|
|Royalty paid|3,315,473|3,016,514|
|Use of assets|1,312,087|1,162,726|
|Disbursement of working capital loan|2,690,000|-|
|Repayment receiverd against working Capital loan|2,690,000|-|
|Loan received from Holding Company|33,113,000|11,500,000|
|Repayment of sub-ordinated loan|33,113,000|11,500,000|
|Subsidiary company|
|Purchase of products|114,092|191,400|
|Sale of products|30,955|-|
|Disbursement of working capital loan|60,516,029|100,316,602|
|Repayment received against working capital loan|
|disbursed|51,420,216|89,966,399|
|Sub-licensing fee charged by the Company|36,800|28,504|
|Commission income|628,450|988,714|
|Dividend income / received|885,000|5,750,000|
|Services provided|-|55,097|
|Funds collected against sales made on behalf of subsidiary|47,979,166|77,516,987|
|Income on working capital loan to subsidiary company|1,574,226|1,527,264|
|Reimbursements made by the Subsidry company|-|1,732|
|Associated companies|
|Purchases and services received|5,305,556|9,966,731|
|Services provided|1,321|19,104|
|Reimbursements made:|
|- by the Associated Company|110,370|148,090|
|- to the Associated Company|265,101|189,526|
|Donations|402,895|396,000|
|Use of assets|186,259|417,147|
|Purchase of taxable loss|2,044,211|1,649,933|
|Contribution to staff retirement benefits|
|Pension fund|2,487|3,120|
|Gratuity fund|203,630|184,478|
|Provident fund|249,757|230,772|

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rooted in 443 character driven leadership

rooted in character 444 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

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||||
|---|---|---|
|2025|.......Rupees.......|2024|
|Dividend paid to staff retirement benefits|
|Pension fund|-|112|
|Gratuity fund|3,680|3,207|
|Provident fund|4,617|4,894|
|Others|
|Remuneration of key management personnel|373,488|340,250|
|Directors' fees|7,070|14,419|

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46. operating segment results

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||||||||||
|---|---|---|---|---|---|---|---|---|
|Urea|Specialty Fertilizers Business|Others|Total|
|2025|2024|2025|2024|2025|2024|2025|2024|
|-----------------------------------------------------------------Rupees-----------------------------------------------------------------|
|Sales|177,808,858|158,482,970|21,652,102|29,118,338|4,769,932|8,768,392|204,230,892|196,369,700|
|Intersegment sales|10,598,500|17,610,536|-|-|-|-|10,598,500|17,610,536|
|Sales tax and duties|(9,615,518)|(7,739,978)|(1,125,451)|(1,449,241)|(242,183)|(471,523)|(10,983,152)|(9,660,742)|
|178,791,840|168,353,528|20,526,651|27,669,097|4,527,749|8,296,869|203,846,240|204,319,494|
|Profit / (loss) before tax|39,651,997|43,193,248|254,226|1,702,100|(168,000)|(75,602)|39,738,223|44,819,746|
|Depreciation & Amortisation|4,431,756|3,680,415|134,440|96,766|688,816|682,002|5,255,012|4,459,183|
|Capital Expenditure|10,569,478|7,084,682|365,566|143,068|878,107|1,290,020|11,813,151|8,517,770|
|Urea|Specialty Fertilizers Business|Others|Total|
|2025|2024|2025|2024|2025|2024|2025|2024|
|-----------------------------------------------------------------Rupees-----------------------------------------------------------------|
|Segment assets|149,403,465|129,409,997|10,249,793|8,264,122|12,729,768|13,965,156|172,383,026|151,639,275|
|Unallocated assets|-|-|-|-|-|-|27,484,615|11,282,856|
|Total assets|149,403,465|129,409,997|10,249,793|8,264,122|12,729,768|13,965,156|199,867,641|162,922,131|

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||||||
|---|---|---|---|---|
|46.1|Reconciliation of reportable segment net sales|2025|.......Rupees.......|2024|
|Total net sales for reportable segment|203,846,240|204,319,494|
|Elimination of intersegment net sales|(10,598,500|(17,610,536)|
|Total net sales|193,247,740|186,708,958|
|46.2|Reconciliation of reportable segment total assets|
|Total assets for reportable segments|172,383,026|151,639,275|
|Add: Unallocated assets|
|- Accrued income|874,728|764,926|
|- Long-term investments|3,597,740|3,517,074|
|- Short-term investments|15,062,850|2,739,411|
|- Cash and bank balances|7,949,297|4,261,445|
|27,484,615|11,282,856|
|Total assets|199,867,641|162,922,131|

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47. production capacity

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|||||||
|---|---|---|---|---|---|
|Designed annual capacity|Actual production|
|Metric Tons|Metric Tons|
|Remarks|
|2025|2024|2025|2024|
|Urea plant I & II|2,275,000|2,275,000|2,289,705|2,147,025|Production|
|planned as per|
|NPK plant|100,000|100,000|76,891|105,296|market demand|
|48.|number of employees|
|Number of employees as at|Average number of employees|
|December 31|during the year|
|2025|2024|2025|2024|
|Management employees|716|707|710|717|
|Non-management employees|469|462|474|467|
|1,185|1,169|1,184|1,184|

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rooted in 445 character driven leadership

rooted in character 446 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(Amounts in thousand)

49. contributory retirement funds

The employees of the Company participate in the Retirement Fund maintained by the Holding Company. The investments out of the retirement fund have been made in accordance with the provisions of Section 218 of the Act and the conditions specified there-under.

50. seasonality

The Company's fertilizer business is subject to seasonal fluctuations as a result of two different farming seasons viz, Rabi (from October to March) and Kharif (from April to September). On an average, fertilizer sales are more tilted towards Rabi season. The Company manages seasonality in the business through appropriate inventory management.

51. interest in joint arrangements

"In 2022, the Company, Fauji Fertilizer Company Limited (Fauji) and Fatima Fertilizer Company Limited (FATIMA) (collectively the Fertilizer Manufacturers) entered into a Framework Agreement dated November 30, 2022 (the Agreement) for Gas Pressure Enhancement Facilities (PEF) project. Under the Agreement, the Fertilizer Manufacturers have decided to jointly develop and install pressure enhancement facilities at Mari Energies Limited's (MEL) (formerly as Mari Petroleum Company Limited delivery node to sustain the current level of pressure of gas supply from HRL reservoir of MEL.

53. corresponding figures

"Corresponding figures have been rearranged and reclassifed, wherever considered necessary, for the purposes of better presentation and / or to comply with the requirements of accounting and reporting standards applicable on the Company.

Corresponding figures and balances have been rearranged and reclassified for better presentation, wherever necessary, The material reclassification made during the year is as follows:

�� For the year ended Description December 31,2024 From To (Rupees) Salaries, wages and staff welfare Administrative expenses Cost of Sales 360,798 Salaries, wages and staff welfare Administrative expenses Selling and distribution expenses 106,207

54. date of authorisation for issue

These financial statements were authorised for issue on February 11, 2026 by the Board of Directors of the Company.

52. non-adjusting event after the reporting date

The Board of Directors in its meeting held on February 11, 2026 has proposed a final cash dividend of Rs. 4.00 per share for the year ended December 31, 2025 amounting to Rs. 5,341,198 for approval of the members at the Annual General Meeting to be held on 25 March, 2026.

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Muh ammad Imran K halil Ali Rathore Ahsan Zafar Syed Chief Financial Officer Chief Executive Officer Chairman

rooted in 447 character driven leadership

rooted in character 448 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

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information

notice of annual general meeting

Notice is hereby given that the Seventeenth Annual General Meeting (“AGM”) of the members of Engro Fertilizers Limited (the “Company”) will be held at Karachi School of Business and Leadership (KSBL) situated at National Stadium Road, Opp. Liaquat National Hospital, Karachi – 74800 on Wednesday, March 25, 2026, at 02:30 p.m. to transact the following businesses:

Members are encouraged to attend the AGM through a video conference facility managed by the Company (please see the notes section for details).

a) ordinary business

1. To receive, consider and adopt the Standalone and Consolidated Audited Financial Statements of the Company for the year ended December 31, 2025, together with the Directors' and Auditor’s Reports hereon and Chairman’s Review Report.

As required under section 223(6) of the Companies Act 2017 (the “Act”), Financial Statements of the Company have been uploaded on the website of the Company which can be downloaded from the following link and/or QR enabled code:

any form (including without limitation guarantees, government securities, cash, listed/unlisted securities etc.) on an arm’s length basis, in the form of a revolving line of credit valid for a period of one year from the date of the special resolution.

b. �� 6,000,000,000) comprising of, inter alia, loans, advances and/or security in any form (including without limitation guarantees, government securities, cash, listed/unlisted securities etc.) on an arm’s length basis, in the form of a revolving line of credit valid for a period of one year from the date of the special resolution.

FURTHER RESOLVED THAT, �� Company Secretary of the Company be and are hereby authorized, any two jointly, to do all acts, �� thisbehalf and the matters ancillary thereto to fully achieve the object of the aforesaid resolutions.

The information as required under section 134(3) of the Companies Act, 2017 is being provided along with the notice of AGM being sent to the shareholders / members.

https://www.engrofertilizers.com/investments#reports

2. �� at the rate of PKR 4 per share i.e. 40% for the year ended December 31, 2025. This is in addition to interim cash dividends of PKR 11.00 per share i.e. 110%.

3. ��

Karachi Dated: March 04, 2026

By Order of the Board

DANISH RAZA Company Secretary

b) special business

4. �� the following Special Resolution(s) under Section 199 of the Companies Act, 2017 read with the Companies (Investment in Associated Companies or Associated Undertakings) Regulations, 2017 (as may be amended), as recommended by the Board of Directors of the Company:

“RESOLVED THAT, approval of the members of Engro Fertilizers Limited (the “Company”) is hereby accorded by way of special resolution (in accordance with Section 199 of the Companies Act, 2017 read with Companies (Investment in Associated Companies or Associated Undertakings) Regulations, 2017) for the following acts by the Company:

a. �� Chemicals Limited, an intercompany loan in the aggregate amount of up to PKR Five billion (PKR 5,000,000,000) comprising of, inter alia, loans, advances and/or security in

rooted in 451 character driven leadership

rooted in character 452 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

5. requirements for appointing proxies

1. prohibition on grant of gifts to shareholders

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penalties. Hence, no gifts in any form will be distributed at the meeting.

2. participation in the AGM proceeding via video conferencing facility

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3. electronic transmission of annual report 2025

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A member entitled to attend and vote at the AGM shall be entitled to appoint another person, �� have all such rights in respect of attending, speaking and voting at the AGM as are available ��
a) In case of individuals, the account holder or sub-account holder whose registration details are uploaded as per the Central Depository Company of Pakistan Limited Regulations, shall ��
b) �� b y t w o male persons whose names, addresses and CNIC numbers shall be mentioned on the form.
c) Attested copies of the valid CNICs or the pass��
d) ��AGM.
e) In case of a corporate entity, the Board of Directors’ resolution/power of attorney, with specimen signature of the nominee, shall be submitted to the Company along with the ��

6. right to cast vote and appointment of scrutinizer

Pursuant to Companies (Postal Ballot) Regulations, 2018 (Regulations) read with Sections �� vote through postal ballot, that is voting by post or through any electronic mode, in accordance with the requirements and procedures contained in the aforesaid Regulations.

�� available on their website (https://www.bdo.com.pk/en-gb/about/about-bdo-pakistan).

7. electronic dividend mandate

Under Section 242 of the Act, it is mandatory for all listed companies to pay cash dividend to its Shareholders through electronic mode directly into the bank account designated by the entitled Shareholders.

To receive dividend directly into their bank account, Shareholders are requested (if not �� Dividend available on the Company’s website at

https://www.engrofertilizers.com/documents/Electronic-Credit-Manadate-Form.pdf and send it duly signed along with a copy of valid CNIC to the Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited, in case of physical shares.

rooted in 453 character driven leadership

rooted in character 454 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

In case of shares held in CDC, Electronic Dividend Mandate Form must be directly submitted to Shareholder’s brokers / participant / CDC account services.

In case of non-receipt of information, the Company will be constrained to withhold payment of dividend to Shareholders.

Shareholders are requested to ensure that their claims for unclaimed dividend and shares are lodged promptly. In case, no claim is lodged with the Company in the given time, the Company shall, after giving notice in the newspaper, proceed to deposit the unclaimed / unpaid amount and shares with the Federal Government pursuant to the provision of Section 244(2) of the Act.

12. conversion of physical shares into cdc account

8. In compliance with Section 150 read with Division I of Part III of the First Schedule of the Income ��

�� based on the “Filer/ Non-Filer” status of the principal shareholder as well as the status of the joint holder(s) based on their shareholding proportions. Members that hold shares with joint shareholders are requested to provide the shareholding proportions of the principal shareholder and the joint holder(s) in respect of shares held by them to our Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited, in writing. In case the required information is not provided to our Registrar it will be assumed that the shares are held in equal proportion by the principal shareholder and the joint holder(s).

9. �� Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited, of the Company �� participant / Investor Account Services.

�� https://famcosrs.com/downloads/) with the Share Registrar of the Company in case of �� unless the above documents complete in all respects have been made available as above.

10. submission of valid cnic (mandatory)

As per SECP directives, the dividend of Shareholders, whose valid CNICs are not available with the Share Registrar, may be withheld. All Shareholders having physical shareholding are therefore advised to submit a photocopy of their valid CNICs immediately, if already not provided, to the Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited without any further delay.

11. unclaimed dividend

As per the provision of section 244 of the Act, any shares issued, or dividend declared by the Company which have remained unclaimed / unpaid for a period of three years from the date on which it was due and payable are required to be deposited with the SECP for the credit of Federal Government �� and dividend declared by the Company which have remained due for more than three years were sent to Shareholders.

The SECP, through its letter No. CSD/ED/Misc/2016-639-640 dated March 26, 2021, has advised all listed companies to adhere to the provisions of Section 72 of the Act, which requires all companies to replace shares issued in physical form to book-entry form within four years of the promulgation of the Act.

Accordingly, all Shareholders of the Company having phy��e requested to convert their shares from physical form into book-entry form at the earliest. Shareholders may contact a PSX Member, CDC Participant, or CDC Investor Account Service Provider for assistance in opening a CDS Account and subsequent conversion of the physical shares into book-entry form. Maintaining shares in book-entry form has many advantages — safe custody of shares with the CDC, avoidance of formalities required for the issuance of duplicate shares etc. The Shareholders of the Company may contact the Share Registrar and Transfer Agent of the Company, namely FAMCO Share Registration Services (Private) Limited for the conversion of physical shares into book-entry form.

statement of material facts under section 134(3) of the companies act, 2017.

agenda Item 4

To approve intercompany loan to the associated companies:

The information required under the Companies (Investment in Associated Companies or Associated Undertakings) Regulations, 2017 is as follows:

(a) Disclosure regarding associated companies and/or associate companies.

(i)Name of associated companies: Name of Associated Companies Sr. #	(i)Name of associated companies: Name of Associated Companies Sr. #
	Name of Associated Companies
01	Engro Corporation Limited
02	Engro Polymer & Chemicals Limited

(ii) Basis of relationship:

Name of Associate	Basis of Relationship	Effective Holding %
Engro Corporation Limited	Holding Company	56.27%
Engro Polymer and Chemicals Limited	Engro Fertilizers Limited and Engro Polymer & Chemicals Limited are under common control of Engro Holdings Limited and have one common director	-

rooted in 455 character driven leadership

rooted in character 456 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

(iii) Basic Earnings Per Share for the last three years:

(iii)Basic Earnings Per Share for the last three years:	(iii)Basic Earnings Per Share for the last three years:	(iii)Basic Earnings Per Share for the last three years:	(iii)Basic Earnings Per Share for the last three years:
(Rupees)
Basic Earnings Per Share	2024	2023	2022
Engro Corporation Limited	35.08	32.26	36.79
��	0.45	9.45	12.39

(iv) ��

(iv)��	(iv)��
(Rupees)
Break-Up Value Per Share	31 December 2024
Engro Corporation Limited	144.78
��	30.06

(v) Financial position, including main items of the statement��

Financial year ended December 31, 2024, standalone audited accounts of Engro Corporation Limited:

(Amount in thousands)

ASSETS

Property, plant and equipment 2,067,358 Right-of-use assets 605,417 Intangible assets 192,332 Long term investments 49,638,186 Long term loans and advances 2,645 - Deferred taxation Loans, advances, deposits and prepayments 1,921,884 Receivables 1,945,912 Short term investments 39,246,511 Cash and bank balances 277,882 �� 2,500,000 Total Assets 98,398,127 LIABILITIES �� 86,643 Lease liabilities 456,985 Deferred taxation 465,003 Trade and other payables 5,328,733 Current portion of lease liabilities 424,273 Taxation – provision less payments 13,715,948 Unclaimed dividends 225,819 Total Liabilities 20,703,404 Total Equity 77,694,723 Income Statement 21,882,800 Dividend income 2,642,389 Royalty income 24,242,067 �� 18,822,707 ��

rooted in 457 character driven leadership

rooted in character 458 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

Financial year ended December 31, 2024, standalone audited accounts of Engro Polymer & Chemicals Limited:

ASSETS Property, plant and equipment Intangible assets Right of-use-asset Long-term investments Long-term loans, advances and deposits Stores, spares and loose tools Stock-in-trade Trade debts Loans, advances, deposits and prepayments and other receivables Income tax recoverable Short-term investments Cash and bank balances �� (Amount in thousands) 49,486,262 514,900 645,943 6,837,000 7,666 4,506,168 13,420,730 1,248,473 10,909,610 6,708,309 1,445,006 3,341,190 -	ASSETS Property, plant and equipment Intangible assets Right of-use-asset Long-term investments Long-term loans, advances and deposits Stores, spares and loose tools Stock-in-trade Trade debts Loans, advances, deposits and prepayments and other receivables Income tax recoverable Short-term investments Cash and bank balances �� (Amount in thousands) 49,486,262 514,900 645,943 6,837,000 7,666 4,506,168 13,420,730 1,248,473 10,909,610 6,708,309 1,445,006 3,341,190 -	ASSETS Property, plant and equipment Intangible assets Right of-use-asset Long-term investments Long-term loans, advances and deposits Stores, spares and loose tools Stock-in-trade Trade debts Loans, advances, deposits and prepayments and other receivables Income tax recoverable Short-term investments Cash and bank balances �� (Amount in thousands) 49,486,262 514,900 645,943 6,837,000 7,666 4,506,168 13,420,730 1,248,473 10,909,610 6,708,309 1,445,006 3,341,190 -
Total Assets LIABILITIES Borrowings Government grant Lease liabilities Deferred liabilities Trade and other payables Accrued interest / mark-up Current portion of: - borrowings - government grant - deferred liabilities Provision for GIDC Short-term borrowings Unclaimed dividend ��	99,071,257 27,941,832 135,872 395,199 1,865,647 19,446,527 617,488 1,047,520 45,090 830,704 6,110,603 11,848,627 284,463 98,860
Total Liabilities	70,668,432
Total Equity Income Statement Revenue (Loss) Before Tax ��	28,402,825 75,677,747 (2,324,387) 610,340

(vi) in case of investment in relation to a project of associated company or associated undertaking that has not commenced operations, following further information, namely: None
(b) General disclosures
(i) ��

Name of Associated Company	Amount in PKR
Engro Corporation Limited	6 billion
��	5 billion

(ii) �� suchinvestment and period of investment:

This will enable the Company to lend to its associated companies when/if it has access �� Each facility will be provided on an arm’s length basis and will be done in a way which ��

(iii) Sources of funds to be utilized for investment and where the investment is intended to be �� where loans or advances will be given (II) Detail of collateral, guarantees provided and ��

�� if the Company has un-utilized overdraft lines, it may opt to avail such lines to provide the ��Company’s responses to the queries raised are as follows:

(i) �� than the borrowing cost of the Company;
(ii) Security - the Company secures its overdraft lines by providing a ranking charge over ��
(iii) ��
(iv) Salient features of the agreement(s), if any, with associated company or associated undertaking with regards to the proposed investment:

rooted in 459 character driven leadership

rooted in character 460 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

��

(v) Direct or indirect interest of directors, sponsors, majority shareholders and their relatives, if any, in the associated company or associated undertaking or the transaction under consideration:

The sponsors, majority shareholders and their relatives and directors of the Company have no interest in the matter. However, the following director on the Board of Director of the Company is also the director of the Holding Company and Associated Company:

Engro Corporation Limited	Engro Polymer & Chemicals Limited	Engro Fertilizers Limited
Ahsan Zafar Syed	Ahsan Zafar Syed	Ahsan Zafar Syed

(vi) In case any investment in associated company or associated undertaking has already been made, the performance review of such investment including complete information/ �� None
(vii) Any other important details necessary for the members to understand the transaction: None
(c) In case of investments in the form of loans, advances and guarantees, following disclosures in addition to those provided above are:
(i) Category-wise amount of investment: Financing limits for each associated company is as follows:

Name of Associated Company	Amount in PKR
Engro Corporation Limited	6 billion
��	5 billion

�� will be higher than or equal to what the Company must pay if it borrows similar facilities. Where it has no such facilities, the associated companies will be charged rates which are �� provided on an arm’s length basis.

(iv) Particulars of collateral or security to be obtained in relation to the proposed investment:

No security is obtained since the Company and its associated company are under common control of Engro Corporation Limited (holding company). The Company and its ��

(v) If the investment carries conversion feature i.e., it is convertible into securities, this fact along with terms and conditions including conversion formula, circumstances in which the conversion may take place and the ti��

No conversion feature.

(vi) Repayment schedule and terms and conditions of loans or advances to be given to the associated company or associated undertaking:

Facility granted for a period of one (1) year. The other terms are mentioned above.

update under the companies (investment in associated companies or associated undertakings) regulations, 2017

�� facility has not been utilized to date since approval. Throughout the year, the Engro Polymers did not raise any request for funds under this facility, as their operational and liquidity needs were ��

(ii) Average borrowing cost of the investing company, the Karachi Interbank Offered Rate (KIBOR) for the relevant period, rate of return for Shariah compliant products and rate of return for unfunded facilities, as the case may be, for the relevant period:

The Company had short-term borrowings amounting to PKR 23,022 Mn as of December 31, 2025. The borrowing rate ranged from KIBOR + spread (-0.15% to +0.50%). The KIBOR �� 10.65%, respectively The Company also invested in Shariah-compliant instruments, with a rate of return ranging from 10% to 12.70%. For non-fund-based facilities, bank rates range from 0.01% to 1.0% per annum.

(iii) �� company:

rooted in 461 character driven leadership

rooted in character 462 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

shareholders’ information including financial calendar

annual general meeting

The Seventeenth Annual General Meeting of the members of Engro Fertilizers Limited (the Company) will be held at Karachi School of Business and Leadership (KSBL) situated at National Stadium Road, Opp. Liaquat National Hospital, Karachi – 74800 on Wednesday, March 25, 2026, at 02:30 p.m., as mentioned in the Notice of Annual General Meeting.

Shareholders as of March 16, 2026 are encouraged to participate and vote.

�� Company at least 48 hours before the meeting time.

�� National Identity Card or passport along with the Participant’s ID number and their account ��

E - dividend mandate (mandatory)

In accordance with the provisions of Section 242 of the Companies Act, 2017, a listed company, is required to pay cash dividend ONLY through electronic mode directly into the bank account designated by the entitled shareholders. Accordingly, the shareholders are requested to provide the information mentioned on an E-DIVIDEND Mandate Form available at the Company’s website www.engrofertilizers.com and send the same to your brokers/the Central Depository Company Ltd. if the shares are held in the electronic form or to the Company’s Shares Registrar if the shares �� provided at the end of the report.

analyst’s briefing held during the year

Engro Fertilizers continued to apprise its stakeholders of the relevant updates about the �� stakeholders. The attendees were briefed on the performance of the Company during the period, �� was conducted to ensure that a comprehensive revelation of the Company’s progress was ��

quarterly results

ownership

On December 31, 2025, there were 51,134 shareholders on record of the Company’s ordinary shares.

�� quarterly results in 2026 are:

Electronic transmission of annual reports through company’s website and email

• 1st quarter: April 20, 2026

As required under section 223(7) of the Companies Act, 2017, Financial statements of the Company have been uploaded on the website of the Company which can be downloaded from the following link:

https://www.engrofertilizers.com/investments#reports

In compliance with the section 223(6) of Companies Act 2017, the Company has electronically transmitted the Annual Report 2025 through email to shareholders whose email addresses are available with the Company’s Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited. In those cases where email addresses are not available with the Company’s Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited, printed notice of AGM along with the QR �� Company would provide hard copies of the Annual Report to the Shareholders on demand at their registered addresses, free of cost, within one week of such request.

Further, shareholders are requested to kindly provide the valid email address (along with a copy of valid CNIC) to the Company’s Share Registrar, M/s. FAMCO Share Registration Services (Private) Limited if you hold shares in physical form or to the respective Participant/Investor Account Services if shares are held in book entry form.

��

• 3rd quarter: October 19, 2026

�� business environment. These sessions are planned to be held on:

• 1st quarter: April 21, 2026 ��

3rd quarter: October 20, 2026

�� Company’s website:

www.engro.com and www.engrofertilizers.com

The Company reserves the right to change any of the above dates.

rooted in 463 character driven leadership

rooted in character 464 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

pattern of shareholding as at december 31, 2025

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
17,572 1 100 625,676
15,767 101 500 5,609,758
5,691 501 1,000 4,837,007
6,867 1,001 50,00 16,739,289
1,742 5,001 10,000 13,122,727
804 10,001 15,000 10,209,940
454 15,001 20,000 8,125,684
376 20,001 25,000 8,674,689
246 25,001 30,000 6,913,066
148 30,001 35,000 4,847,319
152 35,001 40,000 5,825,284
99 40,001 45,000 4,253,791
149 45,001 50,000 7,313,511
64 50,001 55,000 3,378,317
63 55,001 60,000 3,669,653
49 60,001 65,000 3,057,385
43 65,001 70,000 2,922,236
62 70,001 75,000 4,559,456
44 75,001 80,000 3,456,605
21 80,001 85,000 1,739,796
34 85,001 90,000 3,004,290
27 90,001 95,000 2,512,881
91 95,001 100,000 9,052,358
28 100,001 105,000 2,858,991
24 105,001 110,000 2,596,693
16 110,001 115,000 1,805,255
16 115,001 120,000 1,896,410
----- End of picture text -----

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
17 120,001 125,000 2099,466
18 125,001 130,000 2,304,911
10 130,001 135,000 1,330,236
16 135,001 140,000 2,215,456
8 140,001 145,000 1,146,860
18 145,001 150,000 2,689,628
10 150,001 155,000 1,536,521
5 155,00 160,000 785,427
9 60,001 165,000 1,467,374
11 165,001 170,000 1,850,472
11 170,001 175,000 1,922,037
5 175,001 180,000 895,125
5 180,001 185,000 917,644
4 185,001 190,000 749,424
6 190,001 195,000 1,159,351
29 195,001 200,000 5,789,335
11 200,001 205,000 2,235,828
3 205,001 210,000 626,667
1 210,001 215,000 215,000
6 215,001 220,000 1,306,842
8 220,001 225,000 1,780,942
2 225,001 230,000 460,000
3 230,001 235,000 700,229
3 235,001 240,000 714,499
4 240,001 245,000 967,240
9 245,001 250,000 2,247,600
3 250,001 255,000 760,106
2 255,001 260,000 518,817
6 260,001 265,000 1,576,430
1 265,001 270,000 266,500
----- End of picture text -----

rooted in 465 character driven leadership

rooted in character 466 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
2 270,001 275,000 550,000
3 275,001 280,000 835,505
2 280,001 285,000 561,661
5 285,001 290,000 1,446,120
11 295,001 300,000 3,300,000
2 300,001 305,000 6,09,500
5 305,001 310,000 1,539,390
1 310,001 315,000 310,871
5 315,001 320,000 1,591,378
5 320,001 325,000 1,617,454
4 325,001 330,000 1,318,400
4 330,001 335,000 1,331,615
2 335,001 340,000 674,919
3 340,001 345,000 1,033,037
1 345,001 350,000 350,000
7 350,001 355,000 2,473,500
1 355,001 360,000 358,000
5 370,001 375,000 1,867,550
1 375,001 380,000 378,372
1 380,001 385,000 382,500
2 390,001 395,000 784,180
5 395,001 400,000 1,992,082
1 400,001 405,000 400,805
5 405,001 410,000 2,038,380
1 410,001 415,000 412,000
1 415,001 420,000 420,000
1 420,001 425,000 425,000
2 425,001 430,000 856,327
3 430,001 435,000 1,297,961
3 435,001 440,000 1,315,046
----- End of picture text -----

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
2 440,001 445,000 888,300
3 445,001 450,000 1,347,000
1 450,001 455,000 451,500
2 455,001 460,000 915,826
3 465,001 470,000 1,408,320
1 470,001 475,000 475,000
2 480,001 485,000 961,806
1 485,001 490,000 490,000
7 495,001 500,000 3,500,000
2 500,001 505,000 1,006,542
2 505,001 510,000 1,015,320
2 520,001 525,000 1,046,000
4 525,001 530,000 2,116,800
1 530,001 535,000 531,815
1 535,001 540,000 537,800
1 550,001 555,000 550,466
1 555,001 560,000 560,000
1 570,001 575,000 575,000
2 580,001 585,000 1,167,271
1 590,001 595,000 594,991
1 595,001 600,000 600,000
2 620,001 625,000 1,250,000
3 630,001 635,000 1,897,503
1 635,001 640,000 635,500
1 660,001 665,000 660,500
1 680,001 685,000 681,000
2 700,001 705,000 1,403,014
1 710,001 715,000 711,000
2 715,001 720,000 1,434,940
1 725,001 730,000 727,500
----- End of picture text -----

rooted in 467 character driven leadership

rooted in character 468 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
1 750,001 755,000 755,000
1 755,001 760,000 756,701
1 765,001 770,000 768,000
1 790,001 795,000 793,000
2 795,001 800,000 1,600,000
1 805,001 810,000 810,000
1 810,001 815,000 813,000
1 815,001 820,000 817,647
1 820,001 825,000 825,000
3 840,001 845,000 2,526,232
2 865,001 870,000 1,732,500
1 870,001 875,000 872,500
1 875,001 880,000 876,500
1 900,001 905,000 905,000
1 920,001 925,000 925,000
1 930,001 935,000 934,614
6 995,001 1,000,000 6,000,000
1 1,005,001 1,010,000 1,006,500
1 1,010,001 1,015,000 1,013,194
1 1,040,001 1,045,000 1,041,000
1 1,095,001 1,100,000 1,099,041
1 1,110,001 1,115,000 1,112,000
1 1,140,001 1,145,000 1,141,000
2 1,145,001 1,150,000 2,294,099
1 1,165,001 1,170,000 1,165,548
1 1,180,001 1,185,000 1,185,000
1 1,195,001 1,200,000 1,200,000
1 1,230,001 1,235,000 1,233,903
1 1,240,001 1,245,000 1,242,714
1 1,245,001 1,250,000 1,250,000
----- End of picture text -----

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
1 1,295,001 1,300,000 1,300,000
1 1,315,001 1,320,000 1,317,785
1 1,410,001 1,415,000 1,413,221
1 1,430,001 1,435,000 1,435,000
1 1,435,001 1,440,000 1,438,513
1 1,440,001 1,445,000 1,445,000
1 1,485,001 1,490,000 1,485,243
1 1,495,001 1,500,000 1,500,000
1 1,570,001 1,575,000 1,571,789
1 1,595,001 1,600,000 1,600,000
1 1,630,001 1,635,000 1,632,000
1 1,645,001 1,650,000 1,646,784
1 1,745,001 1,750,000 1,750,000
1 1,815,001 1,820,000 1,817,105
1 1,855,001 1,860,000 1,857,580
1 1,890,001 1,895,000 1,892,500
1 1,935,001 1,940,000 1,936,082
1 1,960,001 1,965,000 1,962,675
1 1,995,001 2,000,000 2,000,000
1 2,050,001 2,055,000 2,054,550
1 2,055,001 2,060,000 2,059,595
1 2,070,001 2,075,000 2,073,123
1 2,085,001 2,090,000 2,089,500
1 2,200,001 2,205,000 2,200,500
1 2,225,001 2,230,000 2,225,500
1 2,390,001 2,395,000 2,393,103
1 2,425,001 2,430,000 2,426,742
1 2,500,001 2,505,000 2,500,400
1 3,020,001 3,025,000 3,023,536
1 3,090,001 3,095,000 3,094,443
----- End of picture text -----

rooted in 469 character driven leadership

rooted in character 470 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

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----- Start of picture text -----

No. of Holding
No. of Shareholders From To Total Shares
1 3,160,001 3,165,000 3,160,775
1 3,220,001 3,225,000 3,220,099
1 3,395,001 3,400,000 3,395,734
1 3,545,001 3,550,000 3,550,000
2 3,995,001 4,000,000 8,000,000
1 4,040,001 4,045,000 4,043,300
2 4,120,001 4,125,000 8,246,338
1 4,285,001 4,290,000 4,289,495
1 4,345,001 4,350,000 4,350,000
1 4,395,001 4,400,000 4,400,000
1 4,920,001 4,925,000 4,921,836
1 5,015,001 5,020,000 5,018,016
1 5,485,001 5,490,000 5,490,000
1 6,895,001 6,900,000 6,897,950
1 8,330,001 8,335,000 8,332,146
1 10,605,001 10,610,000 10,608,055
1 13,535,001 13,540,000 13,539,782
1 15,230,001 15,235,000 15230,537
1 121,995,001 122,000,000 122,000,000
1 751,310,001 751,315,000 751,312,049
51,134 1,335,299,375
----- End of picture text -----

categories of shareholding as at december 31, 2025

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----- Start of picture text -----

Sr. # Category of Shareholders No. of Shareholders No. of shares Percentage
01 Directors, Chief Executive Of��r, and 7 1,737 0.00
their spouse and minor children
02 Executives - - -
03 Associated Companies, Undertakingsand related Parties 6 751,568,376 56.28%
04 NIT and ICP - - -
05 Banks, Development Financial Institutions, 25 18,782,830 1.41%
Non-Banking Financial Institutions
06 Insurance Companies 23 138,728,191 10.39
07 Modarabas and Mutual Funds 66 46,158,347 3.46
08 Shareholders holding 10% or more 1 751,312,049 56.27%
09 General Public:
a)Local 50,525 275,029,550 20.60%
- - -
b)Foreign
10 Others 482 105,030,344 7.87%
Total (excluding shareholder holding 10% or more) 51,134 1,335,299,375 100.00%
----- End of picture text -----

Free Float Shares as of December 31, 2025

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|||
|---|---|
|Total outstanding ordinary shares|1,335,299,375|
|Free Float shares|579,722,564|
|Free Float as a % of total outstanding shares|43.42%|

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rooted in 471 character driven leadership

rooted in engro fertilizers limited 472 character annual report 2025 driven leadership

engro fertilizers limited annual report 2025

annual report 2025

key shareholding & shares traded

Information of shareholding required under reporting framework is as follows:

1. Directors, Chief Executive Officer, and their Spouse and Minor Children

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Sr. # Name No. of Shares Held
1 Mr. Ahsan Zafar Syed 1
2 Mr. Farooq Barkat Ali 1
3 Mr. Ahmad Shakoor 8
4 Mr. Asad Said Jafar 1
5 Ms. Sadia Khan 1
6 Mr. Mohammad Younus Dagha 1
7 Mr. Rizwan Khalil Sheikh 1,724
Total 1,737
2. Executives
Sr. # Name No. of Shares Held
1 Total -
3. Associated Companies, Undertakings and Related Parties
Sr. # Name No. of Shares Held
1 Engro Corporation Limited 1
2 Dawood Foundation 3,805
3 Engro Corporation Limited 751,312,049
4 ��
5 Engro Corporation Limited Provident Fund 42,100
6 Engro Corporation Limited Provident Fund 150,038
Total 751,568,376
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4. NIT and ICP
Sr. # Name No. of Shares Held
1 Total -
5. Banks, Development Financial Institutions, Non-Banking Financial Institutions
Sr. # Name No. of Shares Held
1 Total 18,782,830
6. Insurance Companies
Sr. # Name No. of Shares Held
1 Total 138,728,191
7. Mutual Funds and Modarabas
Sr. # Name No. of Shares Held
1 FIRST UDL MODARABA 2
2 FIRST INTERFUND MODARABA 44
3 ASIAN STOCKS FUNDS LTD. 1
4 B.F.MODARABA 75,000
5 FIRST HABIB MODARABA 500,000
6 CDC - TRUSTEE MCB PAKISTAN STOCK MARKET FUND 4,043,300
7 CDC - TRUSTEE PAKISTAN CAPITAL MARKET FUND 105,000
8 CDC - TRUSTEE HBL INVESTMENT FUND 55,000
9 CDC - TRUSTEE HBL GROWTH FUND 111,000
10 CDC - TRUSTEE ALHAMRA ISLAMIC STOCK FUND 1,435,000
11 CDC - TRUSTEE ATLAS STOCK MARKET FUND 4,289,495
12 CDC - TRUSTEE AKD INDEX TRACKER FUND 222,855
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rooted in 473 character driven leadership

rooted in character 474 driven leadership

engro fertilizers limited

engro fetilizers limited annual report 2025

annual report 2025

Sr. #

16 17 18

23 24

Name	No. of Shares Held
TRI-STAR MUTUAL FUND LIMITED	91
CDC-TRUSTEE ALHAMRA ISLAMIC ASSET ALLOCATION FUND	355,000
CDC - TRUSTEE AL MEEZAN MUTUAL FUND	10,000
CDC - TRUSTEE MEEZAN ISLAMIC FUND	6,897,950
CDC - TRUSTEE UBL STOCK ADVANTAGE FUND	2,393,103
CDC - TRUSTEE ATLAS ISLAMIC STOCK FUND	3,023,536
CDC - TRUSTEE AL-AMEEN SHARIAH STOCK FUND	2,426,742
CDC - TRUSTEE MEEZAN TAHAFFUZ PENSION FUND - EQUITY SUB FUND	407
CDC - TRUSTEE APF-EQUITY SUB FUND	248,600
CDC - TRUSTEE APIF - EQUITY SUB FUND	437,239
CDC - TRUSTEE NIT-EQUITY MARKET OPPORTUNITY FUND	934,614
CDC - TRUSTEE ABL STOCK FUND	1,242,714
CDC - TRUSTEE LAKSON EQUITY FUND	408,047
CDC - TRUSTEE NBP MAHANA AMDANI FUND - MT	10,282
CDC - TRUSTEE KSE MEEZAN INDEX FUND	1,485,243
MCBFSL - TRUSTEE ABL ISLAMIC STOCK FUND	1,013,194
CDC - TRUSTEE UBL ASSET ALLOCATION FUND	306,000
CDC - TRUSTEE FIRST CAPITAL MUTUAL FUND	25,000
CDC - TRUSTEE AL-AMEEN ISLAMIC ASSET ALLOCATION FUND	33,400
CDC - TRUSTEE AWT ISLAMIC STOCK FUND	632,825
CDC-TRUSTEE AL-AMEEN ISLAMIC RET. SAV. FUNDEQUITY SUB FUND	375,000
CDC - TRUSTEE UBL RETIREMENT SAVINGS FUND - EQUITY SUB FUND	469,000

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Sr. # Name No. of Shares Held
13 CDC - TRUSTEE ABL ISLAMIC PENSION FUND - EQUITY SUB FUND 45,000
36 CDC - TRUSTEE ABL PENSION FUND - EQUITY SUB FUND 31,588
37 CDC - TRUSTEE AWT ISLAMIC ASSET ALLOCATION FUND 92,000
38 CDC - TRUSTEE NIT ISLAMIC EQUITY FUND 817,647
39 CDC-TRUSTEE NITIPF EQUITY SUB-FUND 66,500
40 CDC-TRUSTEE NITPF EQUITY SUB-FUND 50,000
41 CDC - TRUSTEE NBP SAVINGS FUND - MT 221
42 CDC - TRUSTEE LAKSON TACTICAL FUND 8,000
43 CDC - TRUSTEE LAKSON ISLAMIC TACTICAL FUND 16,000
44 MCBFSL TRUSTEE ABL ISLAMIC DEDICATED STOCK FUND 22,790
45 CDC - TRUSTEE ATLAS ISLAMIC DEDICATED STOCK FUND 217,201
46 CDC - TRUSTEE GOLDEN ARROW STOCK FUND 25,000
47 CDC - TRUSTEE FAYSAL ISLAMIC DEDICATED EQUITY FUND 9,100
48 CDC - TRUSTEE NIT ASSET ALLOCATION FUND 72,050
49 CDC - TRUSTEE NIT PAKISTAN GATEWAY EXCHANGE TRADED FUND 35,424
50 CDC - TRUSTEE UBL PAKISTAN ENTERPRISE EXCHANGE TRADED FUND 81,872
51 CDC - TRUSTEE FAYSAL ISLAMIC STOCK FUND 480,026
52 CDC - TRUSTEE NBP PAKISTAN GROWTH EXCHANGE TRADED FUND 37,638
53 CDC - TRUSTEE MCB PAKISTAN DIVIDEND YIELD PLAN 1,445,000
54 CDC - TRUSTEE PAK-QATAR ISLAMIC STOCK FUND 355,000
55 CDC - TRUSTEE PAK QATAR IPF - EQUITY SUB FUND 23,270
56 CDC - TRUSTEE ALHOF-DIVIDEND STRATEGY PLAN 925,000
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31 32 33 34

rooted in 475 character driven leadership

rooted in character 476 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited annual report 2025

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Sr. # Name No. of Shares Held
57 CDC - TRUSTEE MAHAANA ISLAMIC INDEX EXCHANGE TRADED FUND 160,022
58 CDC - TRUSTEE MDAAF - MEEZAN DIVIDEND YIELD PLAN 378,372
59 CDC - TRUSTEE-PQIAAF - PAK-QATAR ASSET ALLOCATION PLAN IIIA 4,000,000
60 CDC-TRUSTEE FAYSAL ISLAMIC ASSET ALLOCATION FUND - II 1,146,823
61 CDC - TRUSTEE FAYSAL ISLAMIC STOCK FUND-II 215,841
62 CDC - TRUSTEE AWT IPF - EQUITY SUB FUND 22,519
63 CDC - TRUSTEE MAHAANA IGI ISLAMIC RETIREMENT FUND-ESF 24,157
64 CDC - TRUSTEE LUCKY ISLAMIC STOCK FUND 1,646,784
65 CDC - TRUSTEE NIPPFI-NBP ISLAMIC PRINCIPAL PROTECTION PLAN-I 25,587
66 CDC - TRUSTEE LIPF-EQUITY SUB FUND 117,231
Total 46,158,347
8. Shareholder holding 10% or more voting rights in the Company
Sr. # Name No. of Shares Held
1 Engro Corporation Limited 751,312,040
Total 751,312,040
9. General Public (Local)
Sr. # Name No. of Shares Held
1 Total 275,031,273
10. Others
Sr. # Name No. of Shares Held
1 Total 105,030,344
Total Shareholding 1,335,299,375
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�� during 2025:

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Name of Person Date Nature No. of Shares Rate
Mr. Asad Said Jafar January 02, 2025 Sell 5,000 216.69
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rooted in 477 character driven leadership

rooted in character 478 driven leadership

engro fertilizers limited

engro fetilizers limited annual report 2025

annual report 2025

standard request form

Circulation of Annual Audited Accounts.

The Share Registrar Engro Fertilizers Limited. FAMCO Share Registration Services (Private) Limited 8-F, Near Faran Hotel, Nursery, Block-6 PECHS, Shahrah-e-Faisal, Karachi E-mail: [email protected] Telephone No. (9221) 3438 0101-5, 3438 4621-3

Dated: ________

Dear Sirs,

Subject: Request for Hard Copy of Annual Report of Engro Fertilizers Limited.

I, _____S/o, D/o, W/o ___ being a registered shareholder of Engro Fertilizers Limited with the particulars as mentioned below would request that my name be added to the list of Shareholders of the Company who opt for delivery of a hardcopy of the Annual Audited Accounts of the Company and hereby request you send to me the Annual Audited Accounts in hard copy form at my registered address as contained in the member register instead of providing the same through email.

Particulars

Name of Shareholder Folio No. / CDC ID No. CNIC/NICOP/ Passport No. Land Line Telephone No. (if any) Cell No. (if any)

Yours truly,

Shareholder’s Signature

Copy to: Company Secretary Engro Fertilizers Limited 6th Floor, The Harbour Front, Dolmen City HC-3, Block 4, Clifton, Karachi-75600.

proxy form

I/We ______________ of ________ being a member of ENGRO FERTILI��IMITED and holder of _________

(Number of Shares)

Ordinary shares as per share Register Folio No. ____ and/or CDC Participant I.D. No. __ and Sub Account No. _, hereby appoint ____ of ___ or failing him ____ of _______ as my/our pr��y to vote for me/us and on my/our behalf at the Annual General Meeting of the Company to be held on the 25[th] day of March, 2026, and at any adjournment thereof.

Signed this ______day of ______ 2026.

WITNESSES:

Signature: _____ Name: ____ Address: ____ _____ CNIC ____ Signature or Passport No: __ Signature should agree with the specimen registered with the 2. Signature: ____ Company. Name: ____ Address: ___ ____ CNIC ____ or Passport No: _____

Note: Pr��s, in order to be effective, must be received by the Company not less than 48 hours before the meeting. A Pr��y need not be a member of the Company.

CDC Shareholders and their pr��s are each requested to attach an attested photocopy of their Computerized National Identity Card or Passport with this pr��y form before submission to the

Company.

rooted in 479 character driven leadership

rooted in character 480 driven leadership

engro fertilizers limited

engro fetilizers limited

annual report 2025

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rooted in 481 character driven leadership

rooted in character 482 driven leadership

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annual report 2025

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rooted in 483 character driven leadership

rooted in character 484 driven leadership

annual report 2025

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rooted in 485 character driven leadership

rooted in character 486 driven leadership

annual report 2025

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rooted in 487 character driven leadership

rooted in character 488 driven leadership

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engro fetilizers limited

annual report 2025

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rooted in 489 character driven leadership

rooted in character 490 driven leadership

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annual report 2025

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rooted in 491 character driven leadership

rooted in character 492 driven leadership

engro fertilizers limited annual report 2025

engro fetilizers limited

annual report 2025

AI assistant

Engro Fertilizers Limited — Annual Report 2025

71916_rns_2026-03-04_8b673f16-b603-4258-a21a-b93014a18813.pdf

external assurance / reviews

reporting framework

board approval

business performance

financial statements

shareholders information

company profile

company information

board of directors

chairman & non-executive director

non- executive directors

independent directors

chief executive officer

chief financial officer

company secretary

banking partners conventional banks

shariah compliant banks

auditors

registered office

plant sites

daharki

zarkhez

share registrar

speak-out

ceo message (video link)

group structure

Pictured from left to right (standing):

geographical presence

product portfolio & services

product portfolio & services

we grow brands

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Fertilizers

Engro Urea

Phosphatic Fertilizers

Engro NP Plus

Engro DAP

Engro TSP

Engro Zorawar

Engro Zarkhez

Engro Zarkhez Plus

Engro Zarkhez Khaas

Engro Zingro

Engro Zabardast Urea

Engro MOP

Engro SOP

Engro Ammonium Sulphate

Engro Zoron

Engro Potash Power

Engro Phos Power

Engro SOP Power

services

company’s milestone over the years

2016

2022

code of conduct

empowerment with accountability

commitment to engro’s stakeholders

promoting a positive work environment

anti - corruption & bribery

legal compliance

protecting the company’s assets

managing business relationships

statement of ethics

key performance highlights 2025

people

digital

marketing

corporate awards & achievements

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associations

our business model

capitals & key inputs

outcomes

significant factors affecting the external environment (PESTEL)

economic

competitive landscape & market positioning

Engro Fertilizers Limited Annual Report 2025

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