IPDC Finance’s Jan-Mar profit surges on higher investment income and cost reduction

IPDC Finance, one of the leading non-bank financial institutions, has reported more than 21 per cent growth in profit year on year in the January-March quarter, fuelled by higher investment income and reduction of operating expenses.

The non-bank financial institution (NBFI) logged a net profit of Tk 18.37 million in January-March this year, up from Tk 15.14 million in the same quarter of the previous year.

Accordingly, the company's earnings per share (EPS) stood at Tk 0.05, up from Tk 0.04, according to the company's unaudited financial statements published on Thursday.

The company managed to secure higher profit riding on higher investment income from government securities and lower operating expenses, said an official of the company, who preferred not to be named.

Also, the company posted a 19 per cent growth in commission exchanges and brokerages year on year after the removal of 'floor price' on the stock exchanges while its operating expenses declined by 9.45 per cent to Tk 364 million in January-March this year.

The net operating cash flow, a measure of a company's ability to generate cash from its operations, stood at Tk 13.05 in the negative per share in three months through March, as against negative Tk 13.25 in December 2023.

Its net asset value per share slightly improved to Tk 18.24 at the end of March this year from Tk 18.19 in December 2023.

Annual Performance

However, the company's annual profit plunged 60 per cent year on year to Tk 370 million in 2023, from Tk 901 million in 2022, mainly due to higher provisions against loans and higher interest payment to depositors.

Accordingly, the company's earnings per share (EPS) plunged to Tk 0.92 in 2023, down from Tk 2.43 in the year before.

Despite a significant fall in profit, the board of directors of the company has recommended 5 per cent cash and 5 per cent stock dividend for 2023. In 2022, the company paid a 10 per cent cash dividend.

The stock dividend has been declared so that the retained amount can be utilised to support smooth operational cash requirement as well as portfolio growth, said the company in its earnings note.

"Stock dividend has been recommended to strengthen the capital base of the company for supporting future business growth as well as higher loans portfolio growth aspirations in 2024," said the company.

Listed in 2006, the IPDC's stock price fell 3 per cent on Thursday to close at Tk 26. Its stock price slumped almost 55 per cent since the lifting of the 'floor price' in January this year.

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