Record revenue for Apex Footwear amid inflation, thanks to Eid sales

Infograph: TBS

The country's leading shoemaker and exporter Apex Footwear Limited achieved record sales in the last fiscal year despite high inflation and an economic crisis.

It was boosted by two Eid-ul-Azha and one Eid-ul-Fitr festivals between July 2022 and June 2023. Typically, two Eid festivals are celebrated each year.

Still, the company's profit did not increase as expected due to rising costs driven by various factors.

Company officials blamed it on four factors: a strong dollar, a rise in advance income tax, increases in utility prices, and runaway inflation.

Due to inflation, people are struggling to buy daily necessities, due to which they are buying fewer shoes or leather goods, officials said.

According to the financial report, its product sales increased by 27% and profit by 21% in fiscal 2022-23.

The revenue increased to Tk1,653.59 crore, and the profit increased to Tk16.71 crore. That is, the sales of the company's products have increased by Tk356 crore in one year.

Its export revenue increased by 35% to Tk713 crore, and local sales increased by 22% to Tk939 crore.

Sales in the local market rose by Tk171 crore. And the income from shoe exports has increased to Tk185 crore.

But in the final three months of the last fiscal year, revenue stood at Tk491 crore.

The company says that due to the higher dollar rates, there has been an increase in income from conversion. However, local sales have been hurt by the rising dollar as the cost of importing raw materials has increased.

For FY23, the company has declared a 45% dividend for shareholders, including 35% cash and 10% stock. The division was the same as in the previous fiscal year.

The company's share price rose by 3.95%, or Tk11.7 each, on the Dhaka Stock Exchange (DSE) on Wednesday after announcing the dividend. Each share is priced at Tk307.90.

Dilip Kajuri, DMD at Apex Footwear, said, "Profit did not increase as much as our revenue. The sales increased, which is the highest in history. The reasons behind it are very interesting, as we got three Eid festivals in FY23, which fueled our ability to earn good revenue this year."

He said the cost of goods sold increased by 3%. The main reason for this increase is the devaluation of the taka against the dollar. Last year, the source tax on exports was 0.50%, which has doubled now.

"Though costs increased significantly in doing business in the local market, we were unable to increase the price because of high inflationary pressure in the country," he added.

Apex Footwear started its journey more than two decades ago, in 1990. With the inspiration of the leather business, it started the shoemaking operation. At present, the shoemaker has two units, one for local markets and the other for exports.

Apex started its retail chain in 1997 to fulfil the footwear needs of Bangladeshi consumers.

Since its inception, Apex has sought to make use of their expertise in shoemaking and gathered through serving major shoe retailers across the world to provide high-quality and fashionable footwear to everyone.

The company was listed on both stock exchanges in 1993.