Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
Singer Bangladesh saw its second-quarter net profit drop 45 per cent year on year to Tk 257 million, thanks to higher finance costs amid rising interest rate.
In the same quarter (April-June) of the previous year, the electronic and home appliance manufacturer made a Tk 471 million profit, according to its unaudited financial statement published on Thursday.
Accordingly, the earnings per share stood at Tk 2.58 for April-June quarter this year, down from Tk 4.72 in the same quarter a year ago.
The company's net finance costs have more than doubled to Tk 346 million in April-June this year, from Tk 162 million in the same quarter last year, due to the higher level of borrowing being utilised at higher interest rates.
The average interest rate has increased more than 4 per cent compared to last year's same quarter coupled with an increased short-term borrowing.
The company's costs of sales also jumped more than 13 per cent year on year to Tk 5.80 billion in April-June this year, driven by the devaluation of taka against the US dollar and an increase in sales of goods.
The company's sales, however, grew 9.6 per cent year on year to Tk 7.86 billion during the quarter due to an adjustment in the selling price.
The company's gross profit margin declined by 2.3 per cent year on year in April-June quarter this year due to an increase in sales of goods, including locally sourced products, forex crisis and higher discounts and promotional activities to materialise the sales, said the company in its earnings notes.
Its operating profit has also decreased by 26 per cent in second quarter, compared to the previous year, mainly due to an increase in advertisement and sales promotion, shop operating expenses including new shops, rent, bad debts, and repair and maintenance expenses of the new factory, it added.
Meanwhile, its half-yearly profit also fell almost 60 per cent year-on-year to Tk 236 million in January-June this year while sales rose almost 9 per cent to Tk 11.86 billion.
Annual Performance
Singer posted an impressive 615 per cent growth in profit to Tk 522 million in December 2023, as the company managed to offset some of the costs by increasing product prices.
Singer achieved a turnover of Tk 17 billion in 2023, almost the same as Tk 17.10 billion in 2022.
Based on the profit growth, the board of directors of the company declared a 35 per cent cash dividend in 2023, compared to 10 per cent in 2022.
Despite lower profit, its stock price rose 4.26 per cent to Tk 127.30 on Thursday.
Singer is one of the largest retailers of consumer durables in Bangladesh, offering Singer, Beko and other brands.