Marico to pay lowest dividends in 11 years despite 19pc profit growth
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Marico Bangladesh has declared a cash dividend of Tk 20 per share, the lowest in 11 years, for the fiscal year ended in March this year, despite a 19 per cent year-on-year growth in net profit.
The manufacturer of famous Parachute Coconut oil saw its profit jump to Tk 46.06 billion in the year from Tk 38.72 billion a year ago.
For the year until March 2013, Marico disbursed 150 per cent cash dividends to its shareholders. Since then dividends ranged between 425 per cent and 950 per cent. But this year it slashed cash dividends to only 200 per cent from 750 per cent a year ago.
"Our gross profit increased 15 per cent [this year], compared to last year as raw materials' prices fell worldwide. Though our revenue has only risen by 2.70 per cent, we have got the advantage of cheaper materials," said company secretary Musficul Haider.
As the yearly financial statement is not available till now, from their nine-month financial statement it is found that the company bore only Tk 42 as cost of goods sold against revenue of Tk 100 in the year through March.
Historically, the India-based multinational company's cost of goods sold ranged between 51 per cent and 46 per cent of revenue.
Asked why the dividend payment is so low when profit was remarkably good, Mr Haider refused to make any comment.
After the disclosure of the earnings and dividend payment, Marico Bangladesh slid 3.03 per cent on the Dhaka bourse to Tk 2328.50 on Tuesday.
The net operating cash flow, an indicator to show a company's ability to generate cash from its operations, stood at Tk 195.25 per share for the year, up from Tk 171.23 for the year before.
Marico Bangladesh has offloaded only 10 per cent of its outstanding shares in Bangladesh's capital market. According to the latest DSE data, 90 per cent of its stake is hold by sponsors and directors.
While 6.68 per cent of its stake is held by institutional investors, foreign investors have 1.89 per cent and general investors have 1.43 per cent shares.