Summit Power has reported higher earnings per share for the first half of FY24, compared to the same period of the previous year, despite a 30 per cent year-on-year decrease in revenue and 15 percent year-on-year increase in finance cost.


According to a Dhaka Stock Exchange (DSE) filing on Monday, the private power producer earned Tk 1.71 per share in July-December 2023, 9 per cent higher from a year ago.

Private sector power producers' revenue is falling in Bangladesh as the government has changed its energy policy, having seen an escalation in the oil price in the global market since the Russia-Ukraine war broke out. Higher fuel prices mounted a pressure on the foreign exchange reserves.

Bangladesh has tilted towards cheaper coal as the nation has already been suffering from a gas crisis.

More than 80 per cent of Summit's power generating capacity relies on heavy fuel oil (HFO).

The country's largest private sector power producer, Summit Power declared 10 per cent cash dividends for shareholders for FY23 last month, which was the lowest in 20 years, after it recorded a 10-year-low annual profit.


A majority of the listed oil-based electricity producers showed a poor performance in the last year's earnings reports, compared to the same periods of the previous year.

Summit Power declared results of its first quarter and second quarter of FY24 simultaneously on Monday.

The half-yearly financial statement shows a 30 per cent fall in revenue from Tk 31.35 billion in July-December of FY23.

Summit's revenue comes mainly from electricity generation from 15 power plants and from sales of heavy fuel oil.

The statement did not elaborate on why the revenue fell.

Moreover, finance cost jumped 14.5 per cent year-on-year to Tk 1.63 billion in the first half of FY24.

But cost of goods sold of Summit Power decreased dramatically in the six months through December 2023 from the same period of the previous year.

During the same period a year ago, it bore Tk 86 as cost of goods sold against revenue of every Tk 100. This year, the company paid Tk 79 as cost of goods sold for Tk 100 revenue.

The reason for the significant drop in the cost of goods sold could not be known. The FE correspondent could not reach the company secretary despite repeated attempts by phone.

Summit's other income rose 47 percent from Tk 73 million to Tk 108 million.

Meanwhile, the stock closed at Tk 24 each share on the DSE on Monday after a 2.56 per cent increase from the day before.


Source: The Financial Express