Kohinoor Chemical to pay record dividends for FY25, boosted by record profits

Kohinoor Chemical posted a record profit of Tk 632 million in FY25, driven by higher sales and a reduction in raw material prices.

With that, the company registered more than 24 per cent year-on-year profit growth for the year through June, according to price-sensitive information published on Sunday.

Buoyed by the profit growth, the board of directors declared a 65 per cent cash dividend and a 10 per cent stock dividend for FY25 - the highest since the company's listing in 1988.

Higher sales and significantly lower input costs - largely due to a reduced impact from the local currency's devaluation against foreign currencies - helped the company secure the record profit.

"Our revenue increased significantly in FY25, and we have been able to reduce our production costs, which yielded higher profit," said company secretary Md. Kamruzzaman.

"We have also been able to keep production costs lower through efficient management. Our fixed cost remained almost unchanged," he added.

Kohinoor stands out among its peers, supported by sales of its well-known brands of soaps, cosmetics, and toiletries.

The company also managed to partially offset costs by adjusting sales prices.

Although the cosmetics manufacturer is yet to disclose the full-year sales figure, its nine-month sales rose 3 per cent year-on-year to Tk 4.78 billion until March this year.

The cost of sales, which includes all associated costs to produce products, stood at Tk 3.50 billion - 73 per cent of total sales - in the nine months through March, down from 78 per cent in the same period a year earlier.

Market operators say Kohinoor has maintained its profit and sales growth as its products are very popular among middle-income and rural consumers.

Most of its products carry the brand name Tibet. Other brands of the company include Sandalina, Ice Cool, Fast Wash, and Bactrol.

"Many customers are now preferring local brands over foreign brands, which was not the case earlier," said Mohammad Selim, a shop owner in Kawran Bazar wholesale market.

To take advantage of the current situation, the company is introducing

new products and has adopted new branding strategies to capture more market share.

The net operating cash flow per share - a measure of a company's ability to generate cash from its operations - stood at Tk 17.47 in FY25, down from Tk 26.06 (restated) in the previous year.

The company explained that cash flow had shrunk due to an increase in inventory compared with the year before.

The annual general meeting has been scheduled for December 17, and the record date for entitlement to dividends is November 20.

The company said stock dividends would be paid from retained earnings and the funds would be utilized for purchasing capital machinery, construction, and major overhauling.

Meanwhile, despite the lucrative financial results, the stock of Kohinoor Chemical slid 2.46 per cent to Tk 563.9 per share on Sunday on the Dhaka Stock Exchange.

farhan.fardaus@gmail.com