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MJL Bangladesh witnesses steady growth in five yrs

Mohammad Mufazzal | December 10, 2018 00:00:00

MJL Bangladesh, country's largest lubricant company has exhibited a steady growth in revenue earning and dividend disbursement, among others, in last five consecutive years through 'operational excellence'.

During the period, the company registered growth rates between 1.88 per cent to 39 per cent in revenue earnings based on a 'loyal' and 'productive' force.

For the year ended on June 30, 2018, the company has reported a consolidated net profit of above Tk 2.29 billion, which was 7.0 per cent higher than the revenues calculated in previous year.

The managing director of the MJL Bangladesh Azam J Chowdhury said the company continues to perform well in its core business as well as its corporate investments.

"It has been able to register growth in its sale and profitability," Chowdhury said.

Except 2014-15, the company's earnings per share (EPS) gradually rose during 2013-14 to 2017-18 following the increased net profits.

The company's EPS was Tk 3.77 in 2013-14, Tk 3.61 in 2014-15, Tk 5.71 in 2015-16, Tk 6.95 in 2016-17 and Tk 7.0 in 2017-18.

A steady growth was also observed in dividend disbursement in last five years.

MJL Bangladesh disbursed 25 per cent dividend in 2013-14, 30 per cent in 2014-15, 40 per cent in 2015-16, and 45 per cent in 2016-17.

The company's board of directors has recommended 50 per cent dividend (45 per cent cash and 5.0 per cent stock) for 2017-18.

The company's managing director said their subsidiaries have already registered profits.

"Our company's cumulative profits will increase gradually riding on the supports of subsidiaries," Azam J Chowdhury told the FE.

The company possesses significant ownership in two companies, which are its subsidiaries - Omera Petroleum Limited (62.50 per cent share) and Omera Cylinders Limited (98.77 per cent share).

The company's net asset value (NAV) per share gradually rose during 2013-14 to 2017-18.

"The group will continue to invest in down-stream sector of oil & gas, building further capacity, scaling up existing portfolio with more application of automation both in process and in sales," managing director said in the annual report for 2017-18.

He also said they would continue to do so in future to harness energy and align it with the rapid growth in Bangladesh economy.

The products of MJL Bangladesh, a joint venture between government-owned Jamuna Oil Company and EC Securities, are used in the transport industry, industrial sectors, marine industry and aviation sector.

According to annual report, the MJL Bangladesh has 4,500 active industrial customers, 13,500 active retail customers and above 1,000 digital sales customers.

The auditor of the company, however, has given qualified opinion in the company's audit report for the year ended on June 30, 2018.

On the basis of the qualified opinion, the auditor said the Bangladesh Labour (Amendment) Act 2013 requires a company when fulfills certain conditions to set up Workers Profit Participation Fund (WPPF) and to disburse an amount equivalent to 5 per cent of net profit before tax to that fund in each year.

"As disclosed in the note to the financial statements, none of MJL Bangladesh Limited and its subsidiaries has made any provision for the said fund."

The auditor said the net profit after tax of the Group as well as of the company would have been decreased by Tk 157.77 million and Tk 116.46 million respectively if the provisions for WPPF were made in these financial statements.

MJL Bangladesh, presently an 'A' category company, was listed with the stock exchanges in 2011.

The company's sponsor-directors hold 71.53 per cent shares, institutes 16.25 per cent, foreign shareholders 0.38 per cent general shareholders 11.84 per cent as of October 31, 2018.

The company's share price closed at Tk 93 each on Thursday with a marginal loss of 0.43 per cent or Tk 0.40 on the Dhaka Stock Exchange (DSE).

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