Runner Automobiles returned to profit in October-December (Q2), FY24 after losses in five consecutive quarters.
It could rebound as sales of its three wheelers jumped.
The company has experienced a consolidated profit of Tk 6.45 million for Q2, FY24 against a loss of Tk 236.16 million reported for the same quarter of the previous fiscal year.
The consolidated revenue rose 49 per cent year-on-year to Tk 2.16 billion for Q2, FY24, 85 per cent of which was derived from its three-wheeler segment.
The company's chief financial officer (CFO), Sanat Datta attributed the robust growth in sales of three wheelers to the company's being the sole manufacturer of such vehicles.
Other local automobile companies also purchase three wheelers from Runner, he added.
Runner Automobiles built a plant of three wheelers in February, 2023, taking technical support from Indian Bajaj. The plant started operating fully in August last year.
The company started experiencing losses since the first quarter of FY23 and the trend continued until the first quarter of FY24.
The negative income in the quarters of FY23 led to a cumulative loss of Tk 879.90 million for the first time since its listing on the bourses in 2019.
A decline in the sales of two wheelers, three wheelers, and commercial vehicles eroded income in FY23.
After five quarters in a row, the three wheeler business helped the company see a significant growth in revenue in Q2, FY24.
The company's profit, however, remained Tk 273.68 million in the negative for July-December, FY24 because of a loss worth Tk 257.74 million in the first quarter of the year.
The consolidated net operating cash flow per share declined to Tk 13.62 for July-December 2023 as against Tk. 15.86 for July-December 2022.
According to a disclosure by the company, repayment to the supplier resulted in a decrease in the operating cash flow.
Runner Automobiles last year raised a capital worth Tk 2.65 billion issuing sustainability bonds. The fund was used as working capital for three wheeler manufacturing and for building a rooftop solar plant.
The company secretary said the fund from the bonds eased the challenges in L/C opening and overall production of three wheeler vehicles.
The profit of Runner declined significantly in FY22 from the previous year, dragging the company into the red in FY23 because of a hike in raw materials' prices, currency depreciation, and a showdown in the sales of products.
A significant portion of the company's revenue was wiped out by the finance cost in FY23 because of its loan burden.
It has recently planned to reduce bank loans by injecting equity funds to be raised by issuing preference shares.
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