Eastern Cables back to profit after 4 years

After bracing for losses in the past four years, state-owned cable maker – Eastern Cables Limited (ECL) – returned to profit in the fiscal year 2021–22 by cutting significantly its overhead costs.

The publicly traded company’s net profit rose to Tk 0.89 crore in FY22 from a loss of Tk 12.35 crore in the previous fiscal.

The earnings per share (EPS) of the cable maker, subsequently, jumped to Tk 0.34 for FY22 against a per-share loss of Tk 4.68 in FY21.

The company in an official disclosure on Wednesday said, its earnings returned to positive in the last fiscal year riding on the reduced overhead costs and an increase in its sales.

The Chattogram-based cable maker’s board of directors recommended a 2 per cent cash dividend for the year ended in June 2022.

The company had incurred massive losses in the past four years, consequently failing to pay any dividends to its shareholders.

The company is slated to hold its annual general meeting (AGM) on January 30, 2023, through a digital platform. It has fixed the record date as December 8 next for the share splits.

Eastern Cables Limited, a subsidiary of Bangladesh Steel and Engineering Corporation, got listed on the Dhaka Stock Exchange (DSE) in 1986 and on the Chittagong Stock Exchange (CSE) in 1997.

In 2018, BRB Cable Industries Limited bought a nearly 18 per cent stake in Eastern Cables through the stock market.

That share purchase helped BRB Cable Industries secure four seats on the board of Eastern Cables.

BRB acquired that stake in Eastern Cables in a bid to strengthen its monopoly in the domestic cable market. Currently, BRB accounts for nearly 40 per cent market share in the domestic cable market, industry sources said.

Eastern Cables reported a net asset value per share of Tk 344.06 and net operating cash flow per share (NOCFPS) of Tk 0.45 for FY22 versus Tk 10.42 and Tk 8.14 respectively for the previous year.

The company further informed that its NAV per share was higher in the fiscal year 2021-22 than that in the previous year due to its asset revaluation in the last fiscal.

The company’s revaluation surplus stood at Tk 880 crore as on June 2022.

The state-run publicly traded company also published its unaudited financial statements for the first quarter (July-September) of FY23 on Wednesday.

It logged a profit of Tk 21.12 lakh in Q1 of FY23 which was a net loss of Tk 2.67 crore in the same period of the previous year.

Its earnings per share (EPS) stood at Tk 0.08 for the July-September of FY23 against per share loss of Tk 1.01 for the July-September of FY22.

Moreover, the state-owned cable and conductor manufacturer signed a $4.2 million worth of wire export deal with the China National Technical Import and Export Corporation in early July this year.

As per the contract, it already started the export operations, a source at the company said.

ECL is the biggest cable and conductor manufacturer in Bangladesh with producing PVC insulated and PVC sheathed single-core and multi-core low-tension domestic cables.

The production line also includes electric controls and aluminium conductors.

The company’s shares were traded at Tk 203.20 per share on the DSE trading floor on Wednesday.