After incurring losses for three consecutive years, state-owned National Tubes Limited profited in the 2019-20 financial year, only to plunge into losses again in the first half of the current fiscal year.
Despite the Covid-19 pandemic, the company said its profits rose in FY20 because of a 30% increase in API pipe prices.
However, in the first six month of FY21, when the situation was normalising and businesses began to resume, it posted losses as sales decreased by 19%.
Its Deputy Chief Accounting Officer and Head of Accounts Shafiqul Islam told The Business Standard, "Our product sales decreased significantly due to Covid-19's impacts. Though demand was high, we failed to deliver because of the lack of raw materials."
When asked how the company had made good profits in the last financial year, he said, "At that time, sales were very good and we made profits, but the amount was very low."
In the July-December period of FY21, the company lost Tk19.33 lakh but its profit was Tk84.55 lakh during the same period of the previous fiscal year.
In the 2014-15 and 2015-16 fiscal years, it was a profit-making entity but subsequently incurred losses for three years in a row.
Though it was in profit in the first quarter of FY21, it lost Tk40.29 lakh in the next quarter.
As per data of the company, in the first six months of FY21, its net sales dropped by 19% to Tk14.98 crore while after tax net profit stood at negative Tk19.33 lakh and earnings per share (EPS) loss was Tk0.06.
In the same period of the previous fiscal year, its net sale was Tk18.39 crore, net profit Tk84.55 lakh and EPS Tk0.24.
During the second quarter of FY21, the company's net sales increased by 5% compared to the same period of the previous fiscal year, but it still incurred losses. Net sales stood at Tk7.85 crore and net profit reached negative Tk40.29 lakh – which were Tk7.49 crore and Tk31.40 lakh, respectively, during the same period of the previous fiscal year.
In the first quarter of FY21, net sales dropped by 34% and profit decreased by 62% compared to the same period of the previous fiscal year. Net sales were Tk7.13 crore and profit was Tk20.10 lakh – which were Tk10.90 crore and Tk53.14 lakh, respectively, during the same period of the previous fiscal year.
Established in 1964, National Tubes is the first and the largest pipe manufacturing company in Bangladesh. It is also the only government-owned steel pipe producer.
In 1972, it was nationalised and is now running under the Bangladesh Steel and Engineering Corporation.
The company manufactures Quality API, ASTM A 53 B, Marine Grade, MS and GI pipe – with 80, 40, 30, and 20 schedules.
Its installed capacity is around 39,000 tonnes of API/MS and GI pipes, per year, while its galvanising capacity is a maximum of eight tonnes per hour.
National Tubes products are used by: the Bangladesh Oil, Gas and Mineral Corporation, the Titas Gas Transmission and Distribution Company, the Jalalabad Gas Transmission and Distribution System, the Bakhrabad Gas Distribution Company, Pashchimanchal Gas Company, the Bangladesh Petroleum Exploration and Production Company, the Dhaka Water Supply and Sewerage Authority, fire hydrant companies, sugar mills, manufacturing industries, and real estate firms.