LafargeHolcim Bangladesh Limited posted 36% growth in consolidated net profit despite a 9% fall in its sales in the 2020 financial year. Their profit rode on the back of various cost reduction and taxation benefits that resulted from the merger of Lafarge and Holcim.
Due to the Covid-19 shutdown and supply disruptions, last year the company posted Tk1,622 crore revenue, which was lower than its revenue in the previous year.
The company's consolidated net profit was Tk236.13 crore and its earnings per share (EPS) stood at Tk2.03 last year. Its consolidated net asset value (NAV) per share was Tk13.95.
The board of the directors of LafargeHolcim in its meeting held on Tuesday recommended a 10% cash dividend to the shareholders for the year that ended on 31 December, 2020.
LafargeHolcim Bangladesh earned the highest amount of net profit – Tk281.97 crore – in the financial year 2014. In the financial years 2010 and 2011, the company had faced losses. Since 2014, it has been disbursing 10% cash dividends to shareholders.
Rajesh K Surana, chief executive officer of LafargeHolcim Bangladesh, said, "The company has demonstrated resilient results with its focus on health, cost and cash. Our initiatives to focus on digitalisation and innovation, provided further impetus to the outstanding results."
"We are very proud of the agility and great team work of our employees and the strong support of our customers and suppliers," he added.
The cement company will hold its annual general meeting on 22 April and the record date has been set on 24 March.
Currently, LafargeHolcim has a capacity to produce 4.2 million tonnes of cement yearly, which makes up 10% of the market in Bangladesh.
LafargeHolcim's share price at the Dhaka Stock Exchange rose by 1.54% on Tuesday, and its closing price stood at Tk52.60.
LafargeHolcim, which was listed on the capital market in 2003, has a paid-up capital of Tk1,161 crore. Sponsors and directors of the company hold 64.68% of its shares, while institutional investors 15.95%, foreign investors 0.79% and general investors have 18.58% of the shares.
LafargeHolcim Bangladesh Ltd is a frontline cement producer in Bangladesh. Operating for almost two decades, it has invested $500 million in building one fully integrated cement plant and three grinding plants - the largest foreign direct investment in the sector. It is a joint venture of LafargeHolcim Group based in Switzerland and Cementos Molins based in Spain.
The company in 2020 launched a specialised waterproofing product "Holcim Water Protect" and also introduced a digital app for better access by the customer.
In a press release, the company said during the last year, its focus on supply chain management, contract negotiations and improved production efficiencies have helped mitigating the impact of softer volume growth. Fixed costs were also significantly lower during the year. The company's cost management and operational efficiency programmes have maintained their strong momentum in a pandemic year.