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Maintenance and modification move

RAK Ceramics shuts one tiles production unit for 3 months

Staff Correspondent
10 Aug 2023 21:09:56 | Update: 10 Aug 2023 21:09:56
RAK Ceramics shuts one tiles production unit for 3 months

RAK Ceramics (Bangladesh) Ltd, the country’s largest tiles and sanitaryware maker, will keep one of its four tiles production lines shut for three months due to a maintenance and modification move.

The publicly traded multinational company’s maintenance work started form August 9, as per a disclosure posted on the Dhaka Stock Exchange (DSE) on Thursday.

The three other production lines will continue their production as usual, it said.

RAK Ceramics reported a 34 per cent year-on-year profit fall in the first six months of the calendar year 2023.

The ceramic maker braced for this misfortune as an unprecedented hike in gas and electricity prices as well as a staggering surge in raw material prices in the global market have drained its earnings to a massive extent.

The UAE-Bangladesh-based joint venture firm’s net profit fell to Tk 28.5 crore in the January-June period this year from Tk 43 crore in the same period last year.

The publicly traded company said its sales rose marginally in the first half of the current year to Tk 381.39 crore from Tk 380.30 crore in the same period a year ago.

The company’s earnings per share (EPS) fell to Tk 0.67 in January-June this year, down from Tk 1.01 reported for the corresponding period last year.

The company’s net profit fell by over 25.5 per cent in 2022 over the previous year, after it grappled with multiple crises in the year, which included the production cut by the gas shortage, a hike in raw material prices, and volatile currency transactions.

The listed firm’s net profit dropped to Tk 67 crore in 2022 from Tk 90 crore in the previous year.

On July 21 last year, the country’s leading ceramic maker announced its board of directors had decided to invest in the faucet business by establishing a new plant with a production capacity of 1,500 pcs per day at an estimated investment of Tk 95 crore, according to another DSE filing.

On June 14, 2022, the company informed the DSE that it had decided to increase its tiles production capacity by 15,000 square meters per day through a greenfield project at an investment of over Tk 902 crore.

RAK Ceramics stocks have been stuck at the floor price of Tk 42.90 each since October last year on the Dhaka bourse.