Navana Group's two flagship companies – Aftab Automobiles and Navana CNG – have taken a hit in the ongoing Covid-19 pandemic.
Besides, Navana LPG Limited – a new business in the liquefied petroleum gas sector where the group has invested more than Tk500 crore – has also suffered because of "a low price" fixed by the government.
Navana LPG is a wholly-owned subsidiary of Navana CNG.
As a result, Navana CNG's consolidated revenue dropped 22% to Tk379.33 crore in the July-March period of fiscal 2020-21 compared to the corresponding period of the previous year.
Its consolidated net profit also dropped 74% to Tk1.43 crore and the earnings per share (EPS) stood at Tk0.21 at the end of March this year.
The company incurred losses from operational activities, but it has posted a profit on deferred tax assets.
Items on a company's balance sheet that may be used to reduce taxable income in the future are called deferred tax assets. Such a situation can happen when a business overpaid taxes or paid taxes in advance. These taxes are eventually returned to the business in the form of tax relief. Therefore, an overpayment is considered an asset of the company.
The principal activities of the company are the conversion of petrol and diesel-driven vehicles to compressed natural gas (CNG) driven vehicles. It has CNG refuelling stations and other related services.
Navana CNG is currently running 19 CNG refuelling stations and eight CNG conversion workshops at various locations in Bangladesh. It has another two subsidiary companies named – Navana Engineering Limited and Navana Welding Electrode Limited.
Navana CNG was listed on both the Dhaka and Chittagong stock exchanges in 2009. The last trading price of each share of the company at the Dhaka Stock Exchange was Tk37.10.
A senior officer of the company, seeking anonymity, said its revenue has decreased in the first three-quarters of the last fiscal compared to the same period of the previous fiscal year due to the adverse impact of the pandemic.
LPG business is running at a loss from its initial operational stage. Therefore, the consolidated profit resulted in a decrease compared to the corresponding period of the previous year, he added.
He said Bangladesh Energy Regulatory Commission (Berc) fixed the retail price of LPG on 12 April 2021.
"Now, the retail price of 12.5kg LPG cylinder provided by the state-owned Liquefied Petroleum Gas Limited is Tk591, while the 12kg variety of private companies costs Tk975. The above decision has an impact on the revenue of Navana LPG Limited as well as the group's performance," added the official.
Aftab Automobiles – the seller of Hino buses and Mahindra and Keeway-Benelli two-wheelers – suffered a 41% drop in sales and incurred losses in the July-March period of the last fiscal year.
The company said in the financial statement, due to Covid-19 impact their business declined gradually and incurred a loss in the first three-quarters of the last fiscal year. But in the third quarter, its business slightly recovered from the previous quarter.
At the end of March this year, its consolidated revenue stood at Tk107.39 crore and consolidated loss per share stood at Tk0.08.
It has a subsidiary company – Navana Batteries Limited – which has been posting profits during the pandemic.
The company got listed on both stock exchanges in 1987, and its shares' last trading price was Tk30.60 each at the Dhaka Stock Exchange.