Walton posts Tk696cr profit in nine months of FY25

Walton Hi-Tech Industries, the country's leading electrical and electronics manufacturer listed on the stock market, has reported a net profit of Tk696.44 crore for the first nine months (July 2024-March 2025) of FY2024-25.

The company disclosed its unaudited third-quarter financial statements for the period that ended on 31 March 2025. The report was reviewed and approved by Walton's Board of Directors during a meeting held today (27 April), according to a press release issued by the company.

According to the report, the sharp rise in material prices, volatile global market conditions, and the depreciation of the Bangladeshi taka against foreign currencies have significantly increased material costs. Additionally, higher inflation has impacted the company's operating expenses.

Moreover, under the Finance Act 2024, VAT on the supply of refrigerators was raised to 7.5% from 5%, and a 7.5% VAT was imposed on air conditioners, further adding to cost pressures.

As a result, Walton's operating profit margin declined to 22% during the July-March period, down from 24.73% in the same period a year earlier.

Finance costs as a percentage of sales also rose to 7.29%, compared to 6.14% last year, due to higher borrowing costs and currency devaluation.

Consequently, earnings per share (EPS) for the nine-month period stood at Tk22.99, reflecting a 9% decline year-on-year.

As of 31 March 2025, the company's Net Asset Value Per Share (NAVPS) stood at Tk277.04 without revaluation and Tk378.42 with revaluation.

The company's Net Operating Cash Flow Per Share (NOCFPS) also turned negative, standing at Tk1.83, compared to Tk22.88 a year earlier. Walton attributed this decline to a strategic shift in working capital management, where supplier payments were made using customer collections instead of bank borrowings.

Additionally, payments for goods, services, and government dues, including VAT and income tax, rose in line with increased procurement volumes to support anticipated sales growth during the ongoing and upcoming peak seasons.

"These strategic adjustments in cash flow management reflect Walton's long-term commitment to sustainable growth and operational resilience, reinforcing our position in the market," the company said in its statement.

However, Walton's management expressed optimism that profits would improve in the final quarter (April-June) of FY25, benefiting from seasonal peak sales.

Alongside the financial results, Walton's board also approved the launch of a Lithium-Ion Battery Cell Project. The initiative aims to establish a sophisticated manufacturing facility to produce high-quality lithium-ion cells, reduce reliance on imports, and offer competitively priced locally manufactured products.

Commercial production under the project is expected to begin by mid-2026.