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LafargeHolcim earned its lowest profit in four years in 2024 due to lower sales amid recent political changeover and adverse macroeconomic environment.
The multinational cement manufacturer's profit plunged 36 per cent year-on-year to Tk 3.82 billion in 2024. As a result, earnings per share (EPS) fell to Tk 3.29 in 2024 from Tk 5.12 the year before.
Due to a decline in profits, the board of directors slashed dividends to 38 per cent in cash for 2024, including a 19 per cent interim dividend, from a record cash dividend of 50 per cent paid for 2023.
Investors will receive Tk 3.8 per share, including the interim dividend, against a profit of Tk 3.29 per share.
The total number of shares is 1.61 million and LafargeHolcim will provide Tk 4.41 billion in total in cash dividends for 2024. That means the company will pay its shareholders an additional Tk 590 million from its retained earnings.
The sales dropped 3 per cent year-on-year to Tk 27.54 billion in 2024, according to a statement published on Wednesday.
Company officials say the challenging macro-economic environment and high inflation squeezed net sales as people were reluctant to spend money on not-so-necessary things.
"Bangladesh experienced an eventful year in 2024, yet the company successfully navigated the challenges," said Iqbal Chowdhury, chief executive officer of the company, in a statement.
He expressed optimism that the company will see better results in the future as it has continued its focus on the expansion of sales channels, and has been giving more attention to aggregates business, new products and improved market presence with eco-friendly waste co-processing through Geocycle wing.
The company performed well in terms of sales due to its new business, including that of aggregates and special products. Special products accounted for 8 per cent to total revenue in the year. Operating profit from new business in aggregates grew by 25 per cent year-on-year in 2024.
LafargeHolcim has made progress in its innovative and unique channel expansion through direct-to-retail and net retail outlets, said Mr Chowdhury.
"With a steadfast commitment to operational excellence, cost optimization, and innovation, the company remains confident in delivering strong results in the future," he said.
Looking ahead to 2025 and beyond, the company is actively seeking to broaden its reach and access to the new markets. Furthermore, increasing customer interest in special and innovative new products resulted in greater focus on the two areas, said the company.
Geocycle, the waste management wing of the company, has continued to offer long-term solutions to the country's waste management challenges.
Through its global platform Geocycle, the company co-processed more than 45,000 tonnes of diverse waste streams, which substituted more than 10 per cent fossil fuels to accelerate the green growth agenda of the company.
Meanwhile, the stock price fell 0.20 per cent to Tk 48.9 per share on the Dhaka Stock Exchange on Wednesday.
Industry insiders say LafargeHolcim has a unique edge in business as it depends on its own source of core raw material - limestone, which is transported from mines in Meghalaya to its factory in Chhatak, Sylhet by a conveyor belt.
This advantage creates an opportunity for the company to avoid freight charges and escape international raw material market volatility, two major factors that shrink the profitability of its competitors.
The company will hold an annual general meeting (AGM) on May 8 while the record date is April 9.
The consolidated net operating cash flow per share, a measure of a company's ability to generate cash from its operations, stood at Tk 6.82 for 2024, same as in the year before.
The consolidated net asset value, which refers to the excess of total assets over total liabilities, dropped to Tk 16.01 per share in 2024 from Tk 19.14 in 2023.