Paramount Textile’s profit plunges 20% in July- Sep

Highlights

• Associate firms' business hit Paramount's revenue
• 200MW power plant closed operation in April this year
• Consolidated profit falls to Tk19.17 crore, down from Tk24 crore a year ago
• Earnings per share drops to Tk1.07

Publicly listed Paramount Textile Limited, a sister concern of the Paramount Group, reported a 20% year-on-year decline in profit in the July–September quarter of the ongoing fiscal year 2024-25 due to the closure of the business operation of one of its associate companies.

During the quarter, the company's consolidated net profit stood at Tk19.17 crore, which is lower than the previous year's Tk24 crore.

In its stock exchange filing, the company said the earnings per share (EPS) declined due to the closure of the business operation of one of its associate companies. Additionally, the increase in finance costs further impacted the EPS. 

The net operating cash flow per share increased because one of its subsidiary companies generated a substantial amount of cash, while its operating expenses were significantly lower than its revenue, according to the company's statement. 

The company's share price decreased by 2.125% to Tk46.20 on the Dhaka stock exchange yesterday.

Its EPS stood at Tk1.07, which was Tk1.34 in the same period of the previous year.

At the end of September this year, the company's net asset value per share stood at Tk42.71.

Established in 2006, Paramount Textile makes yarn-dyed fabrics, the sale of which makes 85% of its total income. But now, the company is entering the renewable energy sector.

In FY24, its revenue was Tk1,117.42 crore, and its after-tax net profit was Tk122 crore. Its consolidated EPS was Tk6.62. The company recommended a 5% cash and 10% stock dividend for FY24.

In April this year, Paramount Textile announced to halt operations of its 200MW power plant following the expiration of its power purchase agreement with the Bangladesh Power Development Board (BPDB).

Paramount Textile holds a 49% stake in the power plant and invested over Tk100 crore to construct it in Baghabari of Sirajganj. The plant started its operations in February 2019.

As per the power purchase agreement between Power Development Board and Paramount Btrac Energy lapsed, and the BPDB declined to extend the contract, the management of the plant made the decision to shut it down.

In May this year, the company announced that the Asian Development Bank, in partnership with the Japan International Cooperation Agency and ILX I Fund (B Loan), finalised a $121.55 million financing package with Dynamic Sun Energy Private Ltd. 

This funding is designated to construct and operate a 100-megawatt (MW) grid-connected solar photovoltaic power plant in Pabna. The ADB acted as the sole mandated lead arranger and book runner, arranging, structuring, and syndicating the debt package.

Dynamic Sun Energy Private Ltd is a subsidiary of Paramount Textile, which holds a 49% stake in the company's total paid capital. 

As of 30 November 2024, sponsors and directors jointly held 60.95% shares of the company, institutions 10.86%, foreign investors 4.30%, and general investors 23.89%.