BMRE yet to contribute to profit

The balancing, modernisation, rehabilitation, and expansion (BMRE) project of Tamijuddin Textile Mills Limited has failed to produce any profit in more than a year since the company poured Tk 50 crore in the project in August last year.

According to a recent financial disclosure, the company’s net profit in the last fiscal year came from the yarn sales at high prices. 

The company posted a net profit of Tk 19.87 crore for fiscal year 2021-2022 (FY22) that ended on 30 June 2022. The profit amounted to a jump of over 200 per cent compared to FY21’s Tk6.17 crore.

The Board of Directors of Tamijuddin Textile recommended a 30 per cent cash dividend for FY22– the highest since FY17.

Its earning per share (EPS) for the last fiscal stood at Tk 6.61 against Tk 2.05 in FY21.

The company said its EPS increased due to a higher yarn price and an increase in sales volume.

Bidyut Kumar Roy, company secretary of Tamijuddin Textile Mills, told The Business Post on Tuesday that the net profit for the FY22 mainly came from the yarn sales. The investment made last year for BMRE is still not complete. The money is being poured slowly. As a result, the income during this period has no effect on BMRE.

He said, however, that the BMRE investment will be near completion in the next fiscal year, when the company will reap the benefits of the investment in BMRE.

The company’s net asset value (NAV) per share stood at Tk 87.02 and net operating cash flow per share (NOCFPS) at Tk 10.26 for the last fiscal year against Tk 82.30 and Tk 4.03 respectively for the same period of the previous year.

The company said the significant increase in NOCFPS is owed to a rise in collection from customers while a decrease in receivables.

The company had done the first phase BMRE in 1990-92, the second phase BMRE in 2004-05, and the third phase in 2014-2020.

After one year of the third phase BMRE, the company again decided to invest in BMRE for the fourth phase. The expansion is to be financed by its own equity and bank loan. Most of the machinery will be added or replaced gradually with state-of-the art spinning production equipment from China, Japan and European countries.

The company was listed on the stock exchange in 1992.