Covid-19 eats away shrimp exports

Shrimp exporters - Apex Foods and Gemini Sea Food Ltd – have incurred huge losses in the third quarter of the 2019-20 financial year, thanks to the outbreak of the coronavirus pandemic.

Both the companies are enlisted at the Dhaka Stock Exchange (DSE).

Gemini Sea Food has informed the DSE as price sensitive information that shrimp exports have been facing adversities since March 2020. Therefore, the company has taken some steps to reduce its operations and workforces. 

On the other hand, Apex Foods took no decision on workforce retrenchment and production cut.

According to the Export Promotion Bureau, shrimp exports declined by 10 percent to Tk2,554 crore in the first 11 months of the 2019-20 financial year. The exports dropped more than 47 percent in the last two months.

The Bangladesh Frozen Foods Exporters Association (BFFEA) claimed that they have faced order cancellations of shrimp exports amounting to more than Tk600 crore in the last 20 days. 

While talking to The Business Standard, Kazi Belayet, president of BFFEA said, "We are facing tough times because of order cancellations due to the outbreak of Covid-19. Now we have nothing to do to overcome the situation."

Apex Foods 

Apex Foods Limited was the top exporter of frozen foods in 2011-12 and 2013-14 fiscal years.

In the third quarter (January-March) of 2019-20 financial year, the company's exports increased by 28 percent to Tk52.29 crore. However, it faced a net loss of Tk2.98 crore and its loss per share was Tk5.24.

Meanwhile, in the first nine months of the last financial year, its exports increased by 31 percent to Tk179.69 crore, while it incurred a net loss of Tk2.68 crore and its loss per share was Tk4.58.

An official of the company said that the revenue increased owing to the recovery of some outstanding amounts from different buyers.

"Due to the coronavirus pandemic, foreign buyers have cancelled contracts indiscriminately. As a result, to keep the factory running and not sack the workers, we have to maintain production and exports at even lower cost," he added.  

The closing price of the company's each share was Tk120.10 on Thursday at the DSE. It has been paying 20 percent cash dividends to its shareholders for the last five financial years.

Gemini Sea Food

Gemini Sea Food Limited, a sister concern of Gemcon Group, another local exporter of shrimp, was never able to achieve continuous growth in shrimp exports.

In the third quarter (January-March) of the 2019-20 financial year, the company's exports dropped by 74 percent to Tk5.13 crore. In that period, it faced a net loss of Tk2.50 crore and its loss per share was Tk5.34.

Meanwhile, in the first nine months of the last financial year, the company's exports decreased by 36 percent to Tk36.28 crore, while it  incurred a net loss of Tk2.22 crore and its loss per share was Tk4.74.

The closing price of the company's each share was Tk144.30 on Thursday at the DSE. It has also been paying 20 percent cash dividends to its shareholders for the last five financial years.