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After a year marred with low profit, the overall business of Fortune Shoes Limited has apparently returned to normalcy as it reported higher profit in the first nine months of the fiscal year 2020-2021.
Although the export oriented company posted a steep fall in its profit in the FY20, its net profit increased by 73 per cent in the July-March’21 period and stood at Tk 16.26 crore.
The profit of the publicly traded company was only Tk 9.37 over the same period of the previous financial year.
Contacted, Riaz Uddin Bhuiya, company secretary of Fortune Shoes Limited, told The Business Post that the company’s production was normal despite the pandemic-induced restrictions last year. But it witnessed slight decline in exports, which translated into profit fall.
Fortune Shoes mainly manufactures sports shoes, which are in high demand overseas, which helped the company retain the profit streak as the pandemic did not have much impact on exports.
In FY20, the company exported a total of Tk 120 crore worth of shoes, which was Tk 154 crore in FY19.
The company’s export destinations are mainly England in Europe, Poland, Saudi Arabia, United Arab Emirates, and Malaysia. Recently, the company started exporting products to India.
However, Bhuiyan says there is a huge potential for export of leather shoes in contrast to the global demand.
“If the US trade war with China reduces China’s exports to the United States by 10 per cent, we can capture some of the US market,” he said.
Share price of the footwear company increases 181 per cent from June 1 to August 26.
The price, which was Tk 21.6 on June 1, stood at Tk 60.8 at the Dhaka bourse on Thursday.
The average share price of the company was Tk23 from January to June of the current year.
The company had informed the DSE that there is no undisclosed price sensitive information (PSI) regarding the unusual price hike.
In this regard, the company secretary told The Business Post that he had no idea why the share price hiked. Besides, the company also has no new investment plan.
Fortune Shoes was listed with the Dhaka Stock Exchange and Chittagong Stock Exchange in 2016. The ‘A’ category company’s authorised capital is Tk 250 crore while its paid-up capital is Tk 154 crore, according to the DSE data.
With a market capitalization of Tk 961 crore based on 26 August, Fortune’s total number of outstanding securities was 154,795,704. The face value of each share is Tk 10 at country’s bourses.
Fortune Shoes has been providing dividend to its shareholders regularly since it was listed in the capital market.
For FY20, Fortune Shoes announced a 10 per cent dividend – 5 per cent cash and 5 per cent stock - for its shareholders.
It announced an 18 per cent stock and 2 per cent cash dividend in 2019, 15 per cent stock in 2018 and 12 per cent stock dividend in 2017.
As of July 31, the company sponsors and directors were holding 30.93 per cent shares of Fortune Shoes, while institute holding was 19.59 per cent and public holding was 49.48 per cent.
According to the website of the company, the Fortune Shoes was established in 2012. The company now owns three concerns - Premier Footwear Ltd, Uniworld Footwear Technology Ltd, and MJ Industries.
It has nine production lines and a current capacity of producing 35,500 pairs of shoes per day.
The company has total investment of $40 million; yearly turnover of the company is $28.08 million. The company generates 3,800 employments. The company has 14 byers with world leading retailers like H&M and Primark.
