While macroeconomic factors seemed to have taken their toll on a good deal of companies, the India-based multinational Marico Bangladesh flaunted a 13% profit growth in the October to December quarter of 2022 compared to the same period a year ago.
According to the company, cost-cutting was the key to achieving its business growth, as it has been managing costs right from the beginning of the economic crisis in the country.
In the October to December period, which is the third quarter as the company's financial year starts in April, Marico's profit stood at Tk97 crore, which was Tk86 crore in the same quarter of the previous year.
The company also bagged Tk358 crore in revenue – a 7% increase from the revenue in the same period of 2021.
In the April to December period of 2022, the company's revenue stood at Tk1,092 crore and net profit at Tk298 crore.
The multinational had paid a 750% interim cash dividend to its shareholders in the first half of its financial year.
Marico's Company Secretary Sahabuddin told The Business Standard, "The prompt decision-making of our efficient management did not allow any negative impact on the company's business."
"Despite an increase in the company's production costs, the profit surged as we successfully curbed the cost of sales."
"But in this process, we haven't laid off any staff or cut salaries. Rather, we made several technical changes in our logistics which have helped reduce the selling and distribution costs," he added.
According to its unaudited financial statement, Marico reduced its marketing and selling costs by around 30% in the October to December quarter of 2022.
The increase in profit did not have any effect on the company's share price though.
Since October 2022, Marico's shares have been stuck at the floor price of Tk2,421 each at the Dhaka Stock Exchange (DSE). On Tuesday, 256 shares of the company were traded at this price at the DSE.
Marico started its business in Bangladesh back in 1999 with its flagship brand – Parachute Coconut Oil.
Since then, the company has transformed itself from a single brand to more than 20 brands in personal care and food categories.
Marico Bangladesh got listed on both of the country's stock exchanges in 2009. Its paid-up capital is Tk31.50 crore. But its sponsors and directors hold 90% stake, where general investors have only 1.49% shares. The remaining shares are held by institutions and foreign investors.
To grasp the market share, the company has been diversifying product portfolios and meeting the growing demand. It has also been investing in expanding production capacity.
To meet the growing demand for coconut oil and food products, it invested Tk29.3 crore at the beginning of 2020 to expand its factory capacity in Gazipur and set up a new manufacturing line.
In October 2020, the company decided to invest Tk227 crore in enhancing its "Made in Bangladesh" production.
With this investment, the company has plans to set up a new plant in the Mirsarai Economic Zone.