Walton FY25 profit declines amid higher costs

Walton Hi-Tech Industries' profit dropped 23.5 per cent year-on-year to Tk 10.37 billion in FY25 due mainly to lower sales and higher finance costs.
The electronic and home appliance giant's earnings per share (EPS) fell to Tk 34.22 for the year through June from Tk 44.78 in the previous year, according to price-sensitive information published on Wednesday.
The company's revenue dropped 5.72 per cent year-on-year to Tk 70.82 billion in FY25, primarily due to subdued consumer demand arising from the political unrest surrounding the student-led uprising in the country between mid-July and mid-August 2024.
Apart from lower sales and higher finance costs, increased value-added tax eroded bottom-line growth.
Finance costs rose to 6.33 per cent of sales in FY25, compared to 6.11 per cent in the previous year, largely attributed to higher interest rates and foreign currency losses amounting to nearly Tk 1.24 billion, resulting from continued currency devaluation.
Additionally, selling and distribution expenses increased as the company made efforts to expand its market, further squeezing operating margins, the company said.
Due to the profit decline, the board of directors has declared 175 per cent cash and 10 per cent stock dividends for FY25. For FY24, the company paid 350 per cent cash dividends, the highest since its listing.
The company said it recommended stock dividends to finance its Lithium-ion battery project.
The annual general meeting will be held on October 28 and the record date is September 28.
Merger with Walton Digi-Tech proposed
Walton Hi-Tech Industries' board has also endorsed a Memorandum of Understanding (MoU) regarding the proposed merger of Walton Digi-Tech Industries with Walton Hi-Tech Industries under the relevant provisions of the Companies Act, 1994.
The merger shall remain subject to the consent of shareholders and creditors of the respective companies, approval of the court, and execution of necessary agreements to ensure a distinct brand identity for Walton Hi-Tech Industries.
Walton Digi-Tech Industries is a reputed Bangladeshi IT company with more than eight years of consistent operations. It is the only recognised full-fledged hi-tech product manufacturing company in Bangladesh.
As per the audited financial statement for FY24, Walton Digi-Tech's paid-up capital is Tk 300 million. The company's revenue was Tk 10.16 billion while profit was Tk 181.42 million.
The specific terms and conditions of the merger shall be finalized and agreed upon in the definitive agreement.
This strategic merger is expected to create a substantial competitive advantage for Walton Hi-Tech Industries through vertical integration, thereby enhancing its product portfolio with laptops, desktop PCs, printers, mobiles, printed circuit boards (PCB), IT accessories, electric bikes, and more.

babulfexpress@gmail.com