Jerash Posts 19.8% Revenue Growth, Raises Net Income to $2.2 Million

Key Facts

Jerash Holdings announced on November 10 results for the fiscal second quarter ended September 30, 2026, reporting revenue of $50.3 million, up 19.8% from the same period a year earlier. The company said sales growth came mainly from higher shipments to its largest U.S. customer and other customers whose orders were primarily destined for the U.S. market. The company produces sportswear and outerwear in Jordan for global brands, according to its filing with the U.S. Securities and Exchange Commission. Gross profit grew faster than revenue, while operating income and net income also increased. Net income was $2.2 million, or $0.16 per diluted share, compared with $479,000 and $0.04 per share a year earlier.

Gross profit rose 45.4% to $9.1 million from $6.3 million in the year-earlier quarter, and the gross margin climbed to 18.2% from 15.0%, an increase of 320 basis points. Jerash attributed the margin improvement to higher shipments to U.S. customers with higher margins, as well as efficiency gains related to automation. It added that purchasing raw materials early in the quarter and tightening controls on waste allowances contributed to the improvement. These factors show that gross profit growth outpaced revenue growth during the period. Operating income rose to $3.1 million from $1.1 million a year earlier, nearly tripling its prior level.

The company said net income was $2.2 million, or $0.16 per diluted share, versus $479,000 and $0.04 per share in the same quarter a year earlier, an increase of about 4.5 times. Operating expenses totaled $6.1 million, compared with $5.2 million, which the company attributed to higher sales volume, headcount and related costs. Meanwhile, the effective tax rate fell to 15.7% from 24.3%. Jerash linked the decline mainly to a tax incentive in Jordan that reduced the corporate income tax rate from 20% to 10% effective October 2025. Net income performance therefore reflected both higher operating activity and a lower effective tax rate during the period.

For the first six months of fiscal 2027, revenue increased 23.2% to $100.5 million from $81.6 million in the comparable period. Gross profit rose 40.6% to $17.4 million from $12.4 million, while the gross margin widened to 17.3% from 15.2%. Net cash generated from operating activities was $7.5 million in the six months ended September 30, compared with $318,000 in the corresponding period last year. Cash, cash equivalents and restricted cash totaled $16.9 million on September 30, and net working capital was about $40.6 million. These figures provide a picture of cumulative performance and liquidity at the end of the first half of the fiscal year.

Jerash forecast revenue of between $49 million and $51 million in the fiscal third quarter, equivalent to growth of about 17–22% from the comparable period, and a gross margin of between 16% and 17%. The company said the margin outlook takes into account higher transportation costs for imported raw materials. The projected margin range is below the 18.2% recorded in the second quarter. The chief executive said production facilities are fully booked through June 2027 and order flow remains strong. The company expects to complete the renovation of a recently acquired facility and establish a third subsidiary factory, with support from the Jordanian government, by September 2027, potentially increasing production capacity by about 15–20%.

In a related development, operations official Eric Tang said customer interest increased after the announcement of the U.S.-Jordan trade agreement in July 2026. The two countries signed a reciprocal trade agreement on July 21, according to the Office of the U.S. Trade Representative. The U.S.-Jordan Free Trade Agreement entered into force on December 17, 2001, and eliminated tariffs on Jordanian apparel exports to the United States effective January 1, 2010, according to Jerash’s annual filing. The company’s shares closed at $7.55 on November 10, up 14.92% from the previous close, before trading at $7.40 after hours, down 1.99% from the session’s closing price. The board also approved a quarterly cash dividend of $0.05 per share on November 5, payable on November 23 to shareholders of record on November 16.