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Peninsula Chittagong in the red in July-Mar FY23

FE REPORT | May 09, 2023 00:00:00

The Peninsula Chittagong's profit dropped 37.5 per cent year-on-year to Tk 5.93 million in January-March of the current financial year mainly for higher cost of sales.

As a result, the earnings per share came down to Tk 0.05 in the third quarter from Tk 0.08 in the same quarter of the previous fiscal year, according to the unaudited financial statements.

However, the company remained in the red in the nine months through March for making a huge loss in the first quarter ended in September last year. It could not offset the loss with the profits in Q2 and Q3.

In its earnings disclosure, the company said the EPS fell for an increase in the cost of sales, import bills, and selling and distribution expenses and reduced non-operating income.

Company secretary Mohammed Nurul Azim could not be reached for comments.

An official of the company, preferring not to be named, said the hotel business had suffered immensely during the pandemic because of social restrictions and lockdowns imposed by the government.

Business was expected to recover as the pandemic waned but then it was followed by the Russia-Ukraine war that pushed commodity prices up globally, he said.

"But the management could not increase the selling price of food, accommodation, and services proportionately, which impacted profits."

The net operating cash flow per share became negative at Tk 0.22 in the nine months, from Tk 0.19 in the same period a year ago due to the increase in cash paid to suppliers, and higher administrative, selling and distribution expenses.

Peninsula's revenue mainly comes from the hotel business, with a significant portion generated from the interest on bank fixed deposits.

The stock has been languishing at the floor price of Tk 27.40 since November last year.

The company's annual profit dropped more than 52 per cent year-on-year to Tk 23.13 million in FY22. It declared only 2.50 per cent cash dividend for the last financial year, the lowest since its stock market listing in 2014.

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