Lovello makes record H1 profit despite winter effect

Lovello Ice-cream, a brand of publicly listed Taufika Foods and Lovello Ice-cream PLC, posted the highest first half-yearly profit in the current fiscal year over three years.

The ice cream maker, however, witnessed a decrease in profit in the October-December quarter of the fiscal year 2022-23 from that in the first quarter due mainly to the effect of the winter season.

The company’s Q2 profit was 69 per cent lower than the profit made in the first quarter of the current fiscal year.

The company said the consumer demand for ice cream remains low in the winter season, which led it to register a lower Q2 profit.

Though the ice cream maker’s earnings per share (EPS) and net profit rose in the first six months of FY23, the Q1 earnings helped it register increased earnings and profitability.

Talking to The Business Post, Mohammad Didarul Alam, company secretary of Taufika Foods and Lovello Ice-cream PLC said, “Our first half-yearly profit rose in the current fiscal year, but our business had been sluggish in the second quarter (October-December).”

“The demand for ice cream remains low in the wintry weather, the prime reason which hampered the Q2 profit,” he added.

“Our business remains vibrant during the summer season, that’s why the July-September profit reached a new height in the current fiscal.”

“Besides, the Q2 profit decreased due to the recent increase in import cost, as around 70 per cent of our products are imported,” Didarul Alam further continued.

The winter season is considered a dull season for the ice cream industry.

As a result, the company’s net profit, earnings per share, and net asset value (NAV) per share fell in the second quarter of the current fiscal year.

According to the company’s latest financial report, its sales in the first six months of FY23 were Tk 50.55 crore of which Tk 32.79 crore came from the first quarter. The company’s sales in the second quarter were worth Tk 17.75 crore, down 46 per cent from the first quarter from that the previous quarter.

The ice cream maker had sales of Tk 15.38 crore in the second quarter of FY22, compared to sales of Tk 24.93 crore in the first quarter of the same fiscal. Its second quarterly sales were worth Tk 15.26 crore in FY21 against the first quarterly sales of Tk 20.69 crore same fiscal.

In the July-December quarter of FY23, the company’s earnings per share (EPS) stood at Tk 0.73, which was Tk 0.55 for the same period last fiscal.

Taufika Foods and Agro Industries Limited have been engaged in the business of manufacturing and distribution of ice cream since 2016 under the brand name Lovello.

Lovello Ice-cream is produced of imported high-quality raw materials using state-of-the-art technology.

The firm raised Tk30 crore through an initial public offering (IPO) to expand its business back in 2021.

Upon the approval of the Bangladesh Securities and Exchange Commission (BSEC), the company started its share trading on the DSE and CSE on February 10, 2021.

The paid out an 11 per cent cash dividend to its shareholders for 2021 and 12 per cent cash for 2022.

Its sponsors and directors held a 44.65 per cent stake in the company, while institutions owned 19.98 per cent, and the general public 35.37 per cent till February this year.

The company’s shares closed at Tk 37.90 per share on the DSE trading floor on Thursday.