Net profit of Titas Gas Transmission and Distribution Co Ltd has dropped 43 percent in the first quarter (July-September) of the current fiscal year due to the withdrawal of minimum charges at consumer levels. However, the sale of gas has increased by 26 percent.
Sharifur Rahman, finance director, Titas Gas Transmission and Distribution Co Ltd, told the Business Standard that it has withdrawn the minimum charges in all consumer levels from July 1, 2019, and imposed a demand charge of Tk0.10 per cubic metre, causing a drop in the profit.
The sale improved by 26 percent following an increase of gas price which means the sale amount is shown large despite the sale remains the same. Titas Gas receives distribution charge only for distributing gas.
The Bangladesh Energy Regulatory Commission (BERC) has increased gas prices which came into effect on July 1, 2019. It also fixed distribution charge of Titas Gas as Tk0.25 per cubic metre which was Tk0.22.
In the first quarter of the current fiscal year, Titas Gas sold gas worth Tk4,444 crore, while it was Tk3387 crore at the same time last year.
During this time, the company earned nothing from the minimum charge but earned Tk57 crore from the demand charge which was Tk109 crore in the previous year.
As a result, the net profit decreased to Tk71 crore from Tk 124 crore while the earnings per share was Tk0.72 which was Tk1.24 in the previous year.
On the other hand, the share price of Titas declined Tk3.88 percent in the Dhaka Stock Exchange on Tuesday.
That day, the closing price of the share of the company was Tk37.20. Last year, the highest price of its share was Tk43.70 whereas the lowest price was Tk34.50.
Titas Gas officials have recommended paying 26 percent cash dividends to its shareholders in the previous fiscal year. Annual general meeting of the company will be held on December 22 and the record date has been set as November 18.
The earnings per share of the company was Tk4.70 in the previous fiscal year which was Tk3.43 in 2017-18.