Walton Reports Profit Amid Economic Challenges in H1 FY24-25
Walton Hi-Tech Industries PLC, the country’s leading electrical and electronics company listed under the engineering sector of the stock market, has reported a profit of BDT 3.04 billion for the first six months (July-December 2024) of the fiscal year 2024-25.
This information comes from the company’s unaudited financial statement for Q2 of the current fiscal year, which ended on December 31, 2024. The financial statement was reviewed and approved in Walton’s 43rd board meeting held on Monday, January 27, 2025.
According to the report, global economic instability resulting from the post-COVID-19 scenario and the Russia-Ukraine war, combined with rising fuel prices and inflation, has significantly disrupted trade. Moreover, the soaring prices of raw materials in international markets and the depreciation of the Bangladeshi currency against foreign currencies have led to a steep increase in raw material costs. Additionally, operational expenses were impacted by the high inflation rate.
The Finance Act 2024 further added pressure by raising VAT on refrigerators from 5% to 7.5% and imposing 7.5% VAT on air conditioners.
Reflecting these economic and regulatory challenges, Walton’s net profit margin for the period ending December 31, 2024, declined to 11.96%, compared to 14.37% during the same period last year. Operating profit margin also dropped to 19% from the previous year’s 22.17%. Meanwhile, financial expenses as a percentage of net revenue rose to 7.73% from 7.51% year-on-year.
Despite these challenges, Walton achieved a net profit of BDT 3.04 billion for the July-December 2024 period, compared to BDT 3.40 billion during the same period in the previous year.
The company’s earnings per share (EPS) stood at BDT 10.05 for H1 FY24-25, down from BDT 11.24 in the same period last year. However, EPS for Q2 (October-December 2024) increased to BDT 5.13 from BDT 4.56 in the same period the previous year.
As of December 31, 2024, Walton’s net asset value per share (NAVPS) stood at BDT 264.07 without revaluation and BDT 365.47 with revaluation.
Walton’s net operating cash flow per share (NOCFPS) decreased to BDT 6.93 as of December 31, 2024, from BDT 27.16 during the same period last year. The report cited significant cash outflows for procurement of raw materials to ensure product availability during peak sales seasons and increased payments to the national exchequer and raw material suppliers as reasons for the decline.
The management expressed optimism about the company’s future performance, stating that the upcoming two quarters (January-June 2025), being the peak sales season, are expected to yield more satisfactory results.
