Most listed MNCs post higher profits despite headwinds

Most of the listed multinational companies operating in Bangladesh witnessed higher profits and sales in the April-to-June quarter despite persisting economic challenges at home and abroad, inflationary pressures and higher raw materials prices.

All of the 13 multinational companies that are listed on the Dhaka Stock Exchange have published their financial reports for the quarter. Their collective profit rose 23 percent year-on-year to Tk 2,247 crore.

Sales grew about 14 percent to Tk 12,933 crore.

Though higher sales led to higher profits for most companies, some struggled owing to the hike in raw material prices, energy costs and spiralling operational expenses amid lingering consumer prices.

A top official of an asset management company credits product quality and brand value that allowed MNCs to pass higher costs of production onto consumers.

"Their profits rose thanks to higher sales," he said, adding that some companies, however, found it difficult because of escalated prices of raw materials, energy costs and a spike in salary payments.

Among the MNCs, LafargeHolcim Bangladesh, Singer Bangladesh, Grameenphone, Bata Shoe Bangladesh, Berger Paints, and Marico Bangladesh logged higher profits in the three-month period, while Robi Axiata and Heidelberg Cement returned to profits.

LafargeHolcim clocked a 39 percent higher profit to Tk 170 crore while sales surged 33 percent to Tk 671 crore.

Iqbal Chowdhury, CEO of LafargeHolcim Bangladesh, attributed diverse product portfolio, efficient route to market, digital footprint, nationwide distribution network and aggregates business for helping the company ensure healthy growth momentum.

Singer Bangladesh, a home appliance maker, saw its profits rocket 261 percent to Tk 47 crore, aided by a 34 percent hike in sales, which stood at Tk 717 crore.

The sales rose thanks to the company's wholehearted efforts from the beginning of the year despite the continuation of a few domestic and global issues, such as the Russia-Ukraine war, high inflation and volatility in the foreign exchange market.

Although the situation has not come under control fully, people have accepted the increased prices since commodity prices have remained higher, the company said in its financial report.

Singer Bangladesh said it implemented several marketing strategies in the April-June quarter to boost sales ahead of the Eid festival.

Grameenphone, the largest mobile phone operator in Bangladesh, registered a 29 percent higher profit to Tk 1,193 crore in April-June, the highest profit among all the listed multinational companies.

Robi Axiata, the second-largest mobile phone operator, saw a good quarter after making a Tk 24.4 crore profit. Thus, it rebounded from a loss of Tk 12 crore in the same quarter in 2022.

Robi CEO Rajeev Sethi described data revenue as one of the key drivers for the profitability.

Around 39 percent of its revenue in the second quarter came from the data business.

Berger Paints Bangladesh posted a 5.42 percent increase in profit.

Heidelberg Cement made a profit of Tk 9.11 crore in April-June against a loss of Tk 3.75 crore a year earlier. Sales grew 16 percent to Tk 452 crore.

Marico Bangladesh reported a 29 percent growth in profit, on the back of higher sales and lower marketing and sales costs. The FMCG company's sales rose 8 percent to Tk 396 crore.

Bata Shoe's profits rose 15 percent to Tk 30 crore and sales were up 2.5 percent to Tk 321 crore.

British American Tobacco, Unilever Consumer Care, RAK Ceramics, Reckitt Benckiser Bangladesh, and Linde Bangladesh reported lower profits.

Profits of Unilever Consumer Care dropped 8 percent to Tk 16.5 crore. Sales fell 8 percent to Tk 82 crore.

Profits of RAK Ceramic dropped 33 percent to Tk 12 crore owing to higher cost of energy. Sales rose slightly to Tk 180 crore from the previous year's Tk 179 crore.

Linde's net profit plunged 40 percent to Tk 13 crore in April-June owing to costlier raw materials and higher operating expenses.

Higher production costs, soaring operating expenses and increased tax payments have negatively impacted the earnings growth of BATBC.

Reckitt Benckiser's profit dropped to Tk 14.69 crore from Tk 14.8 crore during the same period in 2022.