One of the nation’s top power companies is Summit Power reported that its earnings per share (EPS) fell to 1 Taka 7 Paisa during the July–December period compared to 1 Taka 71 Paisa during the same period in 2023, with a total profit of 3.09 billion Taka. As a result Summit’s profit has decreased by 1.07 billion Taka or 35% in a single year. During the first half of the current fiscal year. Which runs from July to December, the company’s profit dropped to 2.02 billion Taka from 3.09 billion Taka in the previous fiscal year. Summit Power attributed the profit decline to four main factors.
Summit Power cited four major reasons for the decline in profit
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One of the company’s power facilities had its power purchase agreement with the government not renewed.
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Due to a lack of demand, another power plant continued to operate partially but had no sales.
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Three power plants were operated under a “no power, no bill” basis.
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Some power plants came under taxation as their contracts expired, leading to increased tax expenses.
These elements caused the company’s revenue to drop, which had an immediate effect on its profitability. Contracts for a number of privately owned power plants have not been renewed by the government since the August political shift last year. Consequently, the contract-based power plants of Summit and several other publicly traded power companies have been shut down.
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The Bangladesh Rural Electrification Board (BREB) has chosen not to extend the contracts for three of its power facilities Summit revealed in a separate report yesterday. These consist of the Ullapara power plant. Which has an 11 MW capacity, and the Rupganj and Maona power plants. Which have a combined 33 MW capacity of 66 MW. On April 1 these power plants will stop operating because their contracts were not renewed.
The company made 24.46 billion Taka from July to December 2023, compared to 22.10 billion Taka during the same period in 2022, according to Summit’s financial report. This suggests that revenue increased in 2024 compared to 2023 but expenses grew more quickly than revenue, which led to a decline in profit.
The stock market saw a decline in Summit Power’s share price yesterday (Sunday) as the company announced diminishing profitability. With trade of about 12.5 million Taka the share price on the Dhaka Stock Exchange (DSE) dropped 80 paisa, or 5%, on that day, closing at 14.90 Taka per share.
The publicly traded company Summit Power disclosed the drop in profits in its half-yearly financial report on Sunday, after the Board of Directors approved the financial report for the first half of the current fiscal year at a meeting on Friday. The report was then distributed to investors via the stock exchange yesterday.
