Renata profit falls 26% in Oct-Dec
The company attributed the decline in profitability to several challenges
Highlights
- Revenue grows 14% to Tk1,070cr
- Profit drops 26% to Tk64.72cr
- Earnings per share stands at Tk5.64
- Net asset value per share Tk297.23
- Net operating cash flow per Tk3.60
Renata PLC, one of Bangladesh's leading pharmaceutical companies, reported a 26% decline in consolidated profits for the October-December quarter of FY25.
This downturn was attributed to rising interest costs and increased business expenses, according to the company's financial statement revealed today (25 January).
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During the October-December quarter, Renata PLC reported a consolidated net profit of Tk64.72 crore, with earnings per share (EPS) at Tk5.64. This marked a significant decline from Tk88 crore in net profit and Tk7.68 in EPS during the same quarter of the previous year.
However, the company's consolidated revenue for the quarter rose by 16%, reaching Tk1,070 crore, compared to the same period in the previous year.
In its statement, the company attributed the decline in profitability to several challenges. It cited the political events of July 2024, culminating in the mass uprising and the ouster of the Awami League government on 5 August, which have taken a toll on the economy of Bangladesh.
This was further worsened by widespread flooding, escalating worker unrest across various manufacturing industries, and severe power outages nationwide, all of which significantly increased the cost of sales and operating expenses.
Additionally, the company noted a sharp rise in finance costs, driven by both increased borrowing levels and higher interest rates, which further weighed on profitability and led to the substantial drop in EPS during the second quarter.
In the first half of this fiscal year, Renata reported a 12% growth in consolidated revenue, reaching Tk2,087 crore. However, net profit declined by 35% to Tk124 crore compared to the same period in the previous year.
As of the end of December, the company's consolidated EPS stood at Tk10.83, down from Tk16.57 a year earlier.
Commenting on the revenue growth, Jubayer Alam, company secretary of Renata, stated that the 11.8% consolidated revenue growth was driven by robust performance in multiple segments. Pharmaceutical sales, including exports, grew by 16%, while the animal health segment surged by 15%. Additionally, the company reported an impressive 205% aggregate revenue growth from its subsidiaries.
In its statement, the company noted that Renata achieved sustained export growth by expanding its international footprint to 50 countries, with notable new markets including the United States and Australia.
On Thursday, Renata's shares closed at Tk579.50 on the Dhaka Stock Exchange, marking their lowest level in over two years. Over the past month, its share price has dropped by 12.40%.
Renata was founded in 1972 as Pfizer Laboratories (Bangladesh) and has since grown to become a major player in both domestic and international markets. In 1993, Pfizer transferred ownership of its Bangladesh operations to local shareholders, and the company was renamed Renata Limited.
The company had paid a 92% cash dividend for shareholders for the last fiscal year, a significant increase from the 62.5% cash dividend paid in the previous year.
