LankaBangla Finance posts 37pc profit drop, skips dividend for 2024

LankaBangla Finance has announced no dividend for 2024 after posting a 37.25 per cent year-on-year decline in profit to Tk 274.8 million.

The announcement came as a major disappointment for shareholders, who had expected stronger results in 2024 compared with the previous year.

By the end of the first nine months of 2024, the company's earnings per share (EPS) stood at Tk 0.67, nearly matching the previous full-year earnings and raising investor expectations for a better annual outcome.

However, LankaBangla ultimately reported a final EPS of Tk 0.51 for 2024, down 24 per cent from the nine-month figure and over 37 per cent from the previous year's earnings.

"We had to make higher provisioning in 2024. The year witnessed significant economic turmoil, which adversely affected our profits," said Chief Financial Officer Shamim Al Mamun.

LankaBangla Finance, one of the leading non-bank financial institutions (NBFIs) in the country, has declared no dividend for the first time since its listing in 2006.

Adding to investor frustration, the company delayed the release of its annual results by more than six months. The long-awaited disclosure triggered a sharp market reaction on Wednesday, with the company's stock price plunging nearly 13 per cent to Tk 14.40 a share.

The company also disclosed financial results for the first nine months of this year on Wednesday. For January-September, EPS stood at Tk 0.54, which is 19.4 per cent lower than the same period a year earlier.

According to the company, consolidated EPS dropped mainly due to lower investment income, increased loan-loss provisioning, and higher cost of funds on borrowings during the period.

Consolidated cash flow from operations was Tk 3.41 per share in January-September this year, down from Tk 5.00 per share in January-September 2024, mainly due to higher disbursement of loans and advances to customers.

farhan.fardaus@gmail.com