Lub-rref returns to profit in Q2 on lower costs

Lubricant oil blender Lub-rref (Bangladesh) returned to profit in its second quarter of FY25 after incurring a loss in the first quarter.
However, its profit escalated 92 per cent year-on-year in the October-December quarter of FY25 while revenue plunged 4.47 per cent year-on-year in the same quarter.
The company earned lower revenue in Q2 of FY25, compared to the same quarter of the previous year, but its production cost fell year-on-year and income outside core operations jumped significantly in Q2 of FY25 relative to the same quarter of the previous year.
Earnings per share rose to Tk 0.23 in Q2, FY25 from Tk 0.12 a year earlier.
Lub-rref (Bangladesh), which markets products under the BNO brand, is facing intense competition with other local companies, such as MJL Bangladesh, BP, Total, and FUCHS.
It said it has been losing market share and facing hurdles in opening LCs.
In Q2 of FY24, the company bore Tk 66.64 as cost of goods sold for revenue income of every Tk 100, whereas the cost was Tk 61.61 in the same quarter of FY25.
Earnings beyond core operations increased 70 per cent year-on-year to Tk 46 million in Q2 this year.
In the first six months through December last year of FY25, Lub-rref's revenue fell 20 per cent to Tk 307.26 million.
Lub-rref (Bangladesh) showed a net loss of Tk 26.64 million in the six months' period, whereas it earned a profit of Tk 36.79 million during the same period last year.
Lub-rref (Bangladesh) is not only failing to maintain its market share but also failed to supply products in the market.
The company said it had "gradually faced a sales decline due to product shortages caused by banking cooperation issues."
Issues with Social Islami Bank and a prolonged market gap benefited competitors, it added.
To overcome the problems, the company said it had engaged with the bank, submitted necessary documentation, and initiated a market re-organisation strategy.

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