RSRM hopes to disburse FY20 dividends from Sept
- It declared 10% cash dividends for FY20
- Dividends were approved at the AGM on 29 December 2020
- Production at 2 factories halted since January 2021
- Halt in production led to cash crisis
- It could not pay dividends on time due to cash crisis
Ratanpur Steel Re-Rolling Mills (RSRM), one of the leading steel companies in the country, is likely to disburse the dividends declared for the fiscal year 2019-20 from September as it is trying to resume factory operations.
It approved the dividends at its annual general meeting on 29 December last year but could not disburse those due to a cash crisis.
Officials said the company had almost overcome the crisis and were now able to disburse the dividends.
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The crisis began when the Bangladesh Power Development Board (BPDB) disconnected the power supply to the company's two factories in Chattogram in January this year for not paying Tk40 crore in outstanding electricity bills.
As a result, production at the manufacturing plants was halted.
Mohammad Moin Uddin, company secretary of RSRM, told The Business Standard the company was facing a cash crisis due to the halt in production.
"That is why we could not pay the dividends on time. We expect to start payments from September. The dividends will be paid gradually, instead of at a time, to all the shareholders," he added.
When the power supply to its factories was cut off, RSRM sought a High Court permission to pay the outstanding bills in instalments. The court granted the permission.
After eight months, in August, the BPDB restored the power supply to the factories.
RSRM, a Chattogram-based MS rod manufacturer, incurred losses of Tk29.25 crore in the first nine months (July to March) of the fiscal year 2020-21.
Like RSRM, Western Marine Shipyard also failed to disburse dividends due to a cash crisis.
But its officials could not say anything about when disbursement would begin.
Due to this non-compliance, both Western Marine and RSRM are liable to pay penalties of Tk5,000 daily as per the Dhaka Stock Exchange listing regulation 2015.
