Apex Foods profit soars 148% riding on shrimp export growth

Apex Foods Limited registered a whopping 148% growth in its net profit for the 2021-22 fiscal year compared to the previous fiscal, thanks to a surge in the country's shrimp exports.

The company's net profit increased to Tk2.90 crore in FY22, from Tk1.18 crore in FY21. Its earnings per share (EPS) stood at Tk5.14 in FY22, according to the company's stock exchange filing on Monday.

As per data from the Export Promotion Bureau (EPB), shrimp export in Bangladesh increased by 24% year-on-year to $407 million in FY22, which was also 23% higher than the target set by the government.

In the stock exchange filing, Apex Foods said a global upturn in the demand for its products, especially food items, and the company's efficient running as well as cost efficiency were the main reasons behind its significant profit growth.

However, despite the stellar growth, its share price fell 13.69% to Tk271.80 each at the Dhaka Stock Exchange (DSE) on Monday, compared to the previous trading session.

The company recommended a 20% cash dividend to its shareholders for the last fiscal. To secure shareholders' approval, the annual general meeting will be held on 15 December as the record date is 7 November.

On condition of anonymity, a top official at a brokerage firm said there was a buzz among the investors that Apex Foods would raise its paid-up capital through stock dividends. Consequently, the company's share price increased by 85% in the last two months.

But as the company only declared a cash dividend, the investors opted for booking profits from its shares on Monday.

Meanwhile, Apex Spinning and Knitting Mills Limited – an associate company of Apex Foods – also posted an 18% profit growth in FY22 than the previous fiscal, and declared a 20% cash dividend for the shareholders.

Yet, much like Apex Foods shares, the share price of Apex Spinning also fell by 9% to Tk139.30 at the DSE on Monday as the investors seemed unhappy with the dividend.