Beximco in the red, as it fails to stem revenue decline

After a 43 per cent year-on-year decline in profit in FY23, Bangladesh Export Import Company (Beximco) reported a loss of nearly Tk 708 million for the first quarter of FY24, as exports and local sales plummeted.
Beximco, the flagship company of the Beximco Group, made a profit of Tk 3.36 billion in the same quarter a year before, driven by a significant growth in the textile division.
Earnings per share stood at Tk 0.79 in the negative for the July-September quarter this year, according to a stock exchange filing on Monday.
Its revenue tumbled 70 per cent year-on-year to Tk 5.81 billion in the quarter.
Due to the dwindling demand in the international and domestic markets, coupled with pricier raw materials, the revenue fell drastically, said the company in its earnings note.
Moreover, the price hike of gas and electricity escalated the costs of production. The sharp depreciation of the taka against the dollar and high inflation further impacted the earnings.
The net operating cash flow per share stood at Tk 2.69 in the negative, as against Tk 2.94 in the same quarter last year, due to higher payment to creditors.
Beximco also suffered a loss of Tk 578 million in the final quarter of FY23 due to the same reasons, which cut its annual profit to Tk 7.10 billion.
The profit erosion compelled the company to reduce dividend payout to 10 per cent cash for FY23 from 30 per cent cash disbursed for FY22.
Beximco has expanded its operations and investments into a wide range of industries, including textiles, pharmaceuticals, ceramics, real estate development, construction, trading, marine, food, information and communication technologies, media, financial services, and energy.
The largest private sector group sells its products and services in the domestic market as well as in global markets. Yellow is one of the leading retail fashion clothing brands owned by Beximco.
However, its stock has been stuck at the floor at Tk 115.60 since November last year.
In 2021, it raised Tk 30 billion by floating asset-backed Green-Sukuk (an Islamic Bond) mainly to finance two solar power projects and expansion of its textile division.
Beximco Group's two other listed firms --- Beximco Pharmaceuticals and Shinepukur Ceramics also published their first quarter (Q1) earnings results on Monday.
Beximco Pharmaceuticals
After its annual profit slid more than 9 per cent in FY23, the drug maker's consolidated profit rose 11 per cent year-on-year to nearly Tk 1.57 billion in the July-September quarter of FY24.
Beximco Pharma's revenue also soared 14 per cent year-on-year to Tk 11.16 billion in the first quarter of FY24.
"We delivered strong growth in revenue in the first quarter amidst the ongoing challenges," Nazmul Hassan MP, managing director of Beximco Pharma, said in a disclosure posted on the London Stock Exchange, where the company also listed.
Mr Hasan said the ongoing macroeconomic headwinds, especially the devaluation of local currency and high inflationary pressures, weighed on the bottom line and somewhat overshadowed accomplishment.
"We remain confident in the strength of the business and our strategy as we continue to focus on growth through the delivery of high-quality, affordable medicines to patients."
The stock has remained stuck at Tk 146.20 since February this year.
Shinepukur Ceramics
The ceramic manufacturer's profit nosedived 90 per cent year-on-year to Tk 1.47 million in July-September this year.
The decline was attributed to energy and gas price hikes, costlier raw materials and volatility in the foreign exchange market.
The ceramic maker's stock price has been confined to the floor -- at Tk 43 -- since May this year.
babulfexpress@gmail.com