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9 days ago

Samata Leather still in the red

It, however, cuts losses by 32pc year-on-year in July-September 2023

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The struggling Samata Leather Complex has reported a loss of Tk 0.21 million for July-September last year amid a shortage of working capital.

Samata Leather, a producer and exporter of crust and finished leather products, published its first quarter (Q1), FY24 financial results on Monday, delayed by more than seven months.

The company incurred a loss of Tk 0.31 million in the same quarter of the previous financial year, according to a stock exchange filing on Monday. Year-on-year losses were reduced by 32 per cent in the July-September quarter last year.

"We could not achieve the expected financial improvement due to the shortage of working capital," said an official of the company, requesting not to be named.

The company is still in the process of factory relocation and construction at Hemayetpur in Savar Tannery Industrial Estate.

The net operating cash flow per share, a measure of a company's ability to generate cash from its operations, was Tk 0.08 in the negative, from Tk 0.05 in the negative a year ago.

The net asset value, which refers to the excess of assets over liabilities, stood at Tk 14.32 as of September 2023, almost unchanged from Tk 14.30 in June last year.

Despite poor financial performance, the stock soared 21 per cent in the month through Sunday to Tk 55.5 per share on the Dhaka Stock Exchange.

However, after the financial disclosure, the stock fell 2.52 per cent to Tk 54.1 per share on Monday.

Samata Leather was listed on the stock exchange in 1998. In the last nine years, the company suffered losses in 2015, 2016, 2017 and 2022. The company posted insignificant profits for the rest of the years.

In FY23, it made a profit of Tk 0.42 million and disbursed 0.40 per cent cash dividends only for general shareholders.

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