Governance | Cherat Cement

Governance

CHAIRMAN’S REVIEW

During the year under review, Pakistan’s economy experienced subdued growth. The services sector re-mained the primary contributor, while the industrial sector continued to face challenges. Macroeconomic stability was improved with fiscal consolidation due to improved external account position. Encouragingly, the reduction in policy rates by the State Bank of Pakistan during the year helped in restoring investor confidence upto some extent. The cement sector reflected broader economic trends. Local demand re-mained under pressure. Export markets witnessed encouraging signs although Afghanistan market which is relevant in our case, remained affected due to border closures for few months. Rising energy costs, with high levies and taxes, added pressure to operating margins.

Total sales volume of the Company declined by 9% as against of last year. Domestic and export sales declined by 10% and 3% respectively. Despite lower volumes, the Company delivered its highest ever profit after tax of Rs. 8,681 million for the year ended June 30, 2025, as compared to Rs. 5,500 million last year, driven by improved operational efficiencies, effective cost management and an optimized sales mix. To mitigate escalating power costs and strengthen energy security, the Company commissioned an additional 9 MW of solar based generation capacity during the year. The company continues to strengthen its
competitive edge because of its constant commitment to operational excellence, careful cash flow management, and cost leadership. In order to achieve long-term, sustainable growth, we have made diversity, innovation, and cost optimization our top strategic priorities.

The Board of Directors remained actively engaged in shaping long-term strategy and overseeing risk management. A strategy session was held to review market dynamics, diversification opportunities, and sustainability initiatives. The Board also conducted its annual self-evaluation in accordance with the Code of Corporate Governance, reaffirming its commitment to high governance standards, transparency, and accountability. Prudent cash flow management, operational excellence, and cost leadership remain central to our strategy, enabling us to retain a competitive edge in a challenging market.

During the year, we advanced our renewable energy initiatives, alternate fuel utilization, and strengthened dust emission controls. Large-scale tree plantation campaigns were undertaken to improve air quality and restore ecological balance.

Our social responsibility programs focused on education, healthcare, and community development, building trust with stakeholders and enhancing social impact. The Company has also progressed to its ESG journey by curtailing carbon emissions and improving sustainability reporting in line with the best global practices.

Our economic stabilization measures will lead to gradual recovery, however, challenges such as low domestic demand, high energy costs, and regulatory levies pressures will persist in the short term. We are optimistic about capturing growth opportunities as domestic demand recovers and Afghan export grows.

I extend my sincere appreciation to our employees for their dedication, to our customers and suppliers for their loyalty, and to our bankers, shareholders, and regulatory authorities for their continued trust and support. I also thank my fellow Board members for their valuable guidance and oversight.

With our resilient business model, committed workforce, and forward-looking strategy, your Company is well positioned to create sustainable value for all stakeholders in the years ahead.

Omar Faruque

Chairman

BOARD OF DIRECTORS

Mr. Omar Faruque - Chairman

Non Executive Director

Mr. Omar Faruque studied from the City of London, Polytechnic London, and got a Honours degree in B.A. Finance. Currently, he is the Chief Executive of Zensoft (Pvt.) Limited and a Director of Greaves CNG (Pvt.) Limited. He is a ‘Certified Director’ from the Pakistan Institute of Corporate Governance.
Mr. Azam Faruque - Chief Executive

Executive Director

Mr. Azam Faruque is the Chief Executive of Cherat Cement Co. Ltd. He is an Electrical Engineering and Computer Science graduate from Princeton University, USA. He completed his MBA with high honors from the University of Chicago, Booth School of Business. Apart from the time he has spent in the cement industry, he has also served as a member on the Boards of State Bank of Pakistan, National Bank of Pakistan, and Oil and Gas Development Corporation Ltd. He was a Member of the Board of Governors of GIK Institute, Member of the National Commission of Science & Technology and also a Member of the National Committee of the Aga Khan Foundation. Mr. Azam Faruque has served on the Board of the Privatization Commission of the Government of Pakistan, Atlas Asset Management Ltd., International Industries Ltd., Atlas Battery Ltd., Indus Motor Company Ltd. Habib University Foundation, and was the Chairman KPK Oil & Gas Development Company Ltd.

At present, he is a member of the Board of Directors of Faruque (Pvt.) Ltd., Greaves Pakistan (Pvt.) Ltd., Unicol Ltd., Atlas Honda Ltd. and The Pakistan Business Council. He is a ‘Certified Director’ from the Pakistan Institute of Corporate Governance.
Mr. Akbarali Pesnani - Director

Non Executive Director

Mr. Akbar Ali Pesnani is an MBA and a fellow member of both the Institute of Chartered Accountants and Institute of Cost and Management Accountants of Pakistan. He was the Chairman of Gwadar Port and Gwadar Port Implementation Authority from 2004 to 2006, and has served on the Boards of, Mirpurkhas Sugar Mills, Clariant Pakistan Ltd and Agha Steel Limited. Mr. Pesnani has been associated with the Aga Khan Development Network (AKDN) at senior levels for over 49 years. Mr. Pesnani has also served as a Diplomatic Representative for AKDN in Tajikistan for 7 years and as an Envoy of His Highness the Aga Khan, in Afghanistan for about 2 years.

Presently, he is the Chairman of Cherat Packaging Limited, Jubilee General Insurance Company Limited and the Aga Khan Cultural Service Pakistan. He is also a Director on the Board of Pakistan Cables Limited. His association with the Ghulam Faruque Group dates back almost 44 years.
Mr. Arif Faruque - Director

Non Executive Director

Mr. Arif Faruque is a Swiss - qualified Attorney-at-Law and also holds Masters degrees in both Law and Business Administration from the United States of America. He recently completed the Owner President Management Program at Harvard Business School. He is the Chief Executive of Faruque (Pvt.) Ltd. He is on the Board of Directors of Mirpurkhas Sugar Mills Ltd. and Cherat Packaging Ltd. Besides the above, he is also a member of the Board of Governors of Lahore University of Management Sciences (LUMS).
Mr. Ariful Islam - Director

Independent Director

Mr. Ariful Islam is a senior banker with over 39 years of experience with various banks in Bahrain and Pakistan. He is a qualified Chartered Accountant and was admitted to the Institute of Chartered Accountants in England and Wales in 1983. He is also a Fellow member of the Institute of Chartered Accountants of Pakistan. He worked with Peat, Marwick, Mitchell & Co. (now KPMG) at their main London Office before starting his banking career with Faysal Islamic Bank of Bahrain. He joined Meezan Bank in April 1999 as the Bank’s first Chief Operating Officer and subsequently became Deputy CEO of the Bank in May 2013.

Mr. Islam recently retired Meezan Bank, after serving more than 25 years with the Bank. During his tenure, his contribution has helped develop and transform Meezan Bank into the country’s premier Islamic bank and one of the most profitable banks in Pakistan. He has also served as the Chairman of the Board at Pakistan’s leading Assets Management Company, Al Meezan Investment Management Limited for 17 years. Mr. Islam is currently on the Board of Honda Atlas Cars (Pakistan) Limited, Lucky Core Industries Limited, Raqami Islamic Digital Bank Limited, Cherat Cement Company Limited, Lucky Land Landmark (Pvt.) Limited and Trukr (Pvt.) Limited. He is also an active contributor to and supporter of various educational, health and community development programs in the country.
Mr. Abrar Hasan - Director

Independent Director

Mr. Abrar Hasan serves as the Chief Executive Officer and as a Director on Board of National Foods since 2000. National Foods is the leading multi-category food company in Pakistan producing over 250 different products, marketed both in Pakistan and exported to 40 countries worldwide. Under his leadership, the company has delivered steady sales growth year on year and tremendous success. Mr. Hasan is providing direction and leadership to the company by setting a clear vision for future growth and has actively pursued new market opportunities and delivered successful strategies to drive the company’s vision, focusing on continuous innovation, highest standards of quality and superior consumer value.

He graduated with a BS in Industrial Management and a minor in Industrial Engineering from Purdue University, Indiana, USA. He was elected on the Board of Cherat Cement Company Ltd. as an independent director on October 16, 2018. Mr. Abrar Hasan is also the Chairman of Board for Naymat Collateral Management Company, which is Pakistan’s first Collateral Management Company, that facilitates and empowers farmers by making formal credit accessible to them through financial institutions. Besides this, he is a also a Director of Associated Textile Consultants Holdings (Pvt.) Ltd., Pakistan Business Council. He is a Certified Director from the Pakistan Institute of Corporate Governance.
Mrs. Zeeba Ansar - Female Director

Independent Director

Mrs. Zeeba Ansar has over 27 years of private and corporate banking experience. She did her Bachelors in Economics and Statistics from the University of Punjab and then completed her MBA in Marketing and Finance from the Institute of Business Administration. In her career as a banker she has worked with Deutsche Bank AG as Manager Corporate Banking Department and Faysal Bank as Senior Vice President and Corporate Head-South. She then joined UBL as Executive Vice President and Regional Corporate Head-South and retained the position for 10 years. Her most recent professional engagement was with NIB Bank as Group Head-Corporate and Investment Banking where she worked till 2017.

She is currently serving as Director in Gul Ahmed Textile Mills Limited, Samba Bank Limited and Lucky Investments Limited. She is also a ‘Certified Director’ from the Pakistan Institute of Corporate Governance.
Mr. Yasir Masood - Director

Executive Director

Mr. Yasir Masood is a fellow member of the Institute of Chartered Accountants of Pakistan. He is a Certified Internal Auditor (CIA) and qualified Certified Information Systems Auditor (CISA). He is also a certified Director from Pakistan Institute of Corporate Governance. He is serving as the Director and Chief Operating Officer of Cherat Cement Company Ltd., and also serving on the Boards of Greaves Airconditioning (Pvt.) Ltd., Greaves CNG (Pvt.) Ltd., and Greaves Engineering Services (Pvt.) Ltd.

Mr. Yasir is also serving as Chief Financial Officer of Faruque (Pvt.) Ltd. He has been working and contributing in various committees of different Business forums. He is currently serving as Industry Expert and member of Arbitration panel of Pakistan Stock Exchange Limited (PSX).