Bangas Limited, which produces several branded biscuits, including Pineapple and Grand Choice Salted Biscuits, has seen its profits plummet.
In fiscal 2019-2020, the profit of the company, which is listed on stock exchanges, dropped by about 70% compared to the previous year.
In other words, the company's profit has decreased by about Tk1.11 crore from the previous fiscal year.
The revenue and profits of the companies producing branded biscuits have spiked due to the decrease in the number of people eating in hotels and restaurants during the coronavirus pandemic.
During the coronavirus period, the growth of companies in this sector was about 20%.
Olympic Industries, which is listed on stock exchanges and the market leader with a 25% share in the industry, witnessed a 22% hike in sales in the April-June quarter of this year.
Pran, which holds the second position in the market, has posted a 15% increase in sales during the pandemic.
Nabisco Biscuit and Bread Factory has witnessed more sales growth than in normal times.
Bangas Limited's financial statements show that earnings per share (EPS) and profits have declined sharply in the fiscal 2019-2020.
The company has made a profit of around Tk46 lakh in that financial year, up from Tk1.57 crore in the previous fiscal year.
Regarding the decline in profit, Bangas Company Secretary (Current Charge) Md Ekramul Haque told The Business Standard, "The sales of goods decreased during the coronavirus period and the cost of product distribution went up. The cost of distributing products with incentives increased as many distributors did not want to leave their homes for fear of coronavirus.
"Raw material prices have also gone up during the coronavirus period, which has eaffected profits."
Asked why Bangas Limited's profit dropped when the earnings of other biscuit and bread companies had gone up, he said, "Profits have fallen by about 70% due to increased distribution costs and rising raw material prices."
As of 30 June 2020, the company's EPS was Tk0.60 and the profit stood at Tk45.75 lakh.
This year the company has given a 5% cash dividend, down from 10% - 5% cash and 5% stock - last year.
Upon reviewing the financial accounts, the profit of Bangas was Tk1.57 crore in fiscal 2018-2019, which is a 166% increase from the previous fiscal year.
In other words, the company's profit in fiscal 2017-2018 was Tk58.98 lakh. But it increased significantly the following year.
In the 2016-2017 and 2015-2016 financial years, the company incurred a loss of Tk35.30 lakh and Tk19.81 lakh respectively.
Bangas Limited, which got listed on stock exchanges in 1984, produces sweet and salted biscuits, as well as bread of Bangas brand.
Bangas sells Grand Choice, Evening Touch, Lovely, Wonder, Glucose, and Lexus biscuits in the local market.
The company produces five tonnes of biscuits and five tonnes of bread every day.
According to the Bangladesh Auto Biscuits and Bread Manufacturers' Association, the country's biscuit, and confectionery market size amounts to around Tk6,000 crore.
Haque, Al-Amin and Danish have 5% of the market share each.
They are followed by Bangas, Romania, Deco, Globe, Fu-Wang, Bonoful, Kishowan, Thai Food, Bengal, Gold Mark, Mashafi, and New Olympia, each accounting for a 2-3% stake.
Other companies – including Ifad, Cocola, Pinnacle, Kakoli, Shifa, and Kohinoor Industry – have also occupied a sizable portion of the market.