Leaving the quarterly dent of 2020 behind, Berger Paints Bangladesh Ltd is consistently beating its pre-pandemic performance.
The listed paint giant has posted its highest ever first quarterly sales and profits in the April-June period this year as the demand for its market leading products is robust.
According to the multinational company's quarterly financial statements, their consolidated quarterly sales, which include those of all subsidiary and associate companies, grew to over Tk525 crore in April-June, 152% up from the same quarter of 2020, and also the highest compared to those any previous corresponding quarters.
Also, the after tax profits accounted for Tk74.6 crore for April-June, up from any corresponding quarter in its history.
The revenue and profits in the period were the highest ever among all the first quarterly ones for Berger Paints, said its Director and Chief Financial Officer (CFO) Sazzad Chowdhury.
He thanks the sales team's efforts and the company's focus on cost optimisation.
"The highest ever first quarterly revenue and a continuous focus on cost optimisation together resulted in a high profit before tax," he told The Business Standard.
"On top of the above factors, the reduced corporate tax rate by 250 basis points helped increase the company's net profit after tax," he added.
The Finance Act 2021 reduced corporate tax for listed manufacturers to 22.5% from 25% and as Berger's first quarterly profits would be assessed in the new fiscal year that helped it save some in taxes even for the first quarter.
The 2020 dent and the bounce back
Like most other companies in Bangladesh, Berger's sales over the April-June period of 2020 more than halved to Tk208 crore as two-thirds of the quarter fell into the 66-day long nationwide shutdown imposed to arrest the spread of Covid-19.
The dropped sales had also affected its quarterly profits drastically as the company had to continue some obvious costs.
However, as the economy reopened in June 2020 and there had been no similar lockdown to push factories to remain closed until July this year, Berger proved its resilience and strength to grow further.
Beating the pre-pandemic corresponding quarters, Berger's sales grew to over 405 crore in the July-September quarter and to Tk519 crore in the October-December quarter.
In line with the two previous growing two quarters, Berger's fourth (January-March, 2021) quarter sales shot up to over Tk550 crore and the quarterly profits to over Tk100 crore - both are the quarterly highest in its history, according to Sazzad Chowdhury.
The three consecutive quarters of growth helped the company recover from the first quarter's shocks and finally post Tk58.03 in annual earnings per share (EPS), up from Tk52.22 a year ago.
Now, the first quarterly EPS stood at Tk16.09 this year and the net asset value per share improved to Tk248.87 at the end of June.
The quarter-on-quarter decline in April-June this year
Both Berger's sales and profit figures for the April-June quarter were up from the same quarter of any previous year, but down from the immediate past quarter of 2021.
The CFO said it was mainly due to seasonality in their business as the construction sector remains more active in the winters.
Also, some sales disruption at retail outlets in April due to the government restriction impacted the topline in the last quarter, he added.
Amid the pandemic, disrupted sales have been recovering afterwards, as the demand does not go away, said Khandker Abu Jafar Sadique, company secretary of Berger Paints Bangladesh.
"People and organisations who need paints might have to wait during the days of government restrictions, but subsequently they came back for buying," he added.
He also said like all other companies in Bangladesh, Berger's costs of raw materials have increased in recent months due to the hikes in international freight charges this year.
However, the company is trying to offset that through rationally increasing the price of some of its products, depending on market factors, Sadique added.
The multinational company, beginning trading paints here in 1950s and manufacturing here in 1970, now is serving an around half of the local paints market estimated to have gained an annual size of nearly Tk4,000 crore.