Mozaffar Spinning sees big jump in profit

FE REPORT | Thursday, 20 January 2022

Mozaffar Hossain Spinning Mills, a 100 per cent export-oriented woven fabrics and cotton yarn manufacturer, has posted an impressive profit growth in October-December 2021, thanks to higher sales and price hike of yarn.

In a filing with Dhaka Stock Exchange (DSE) Wednesday, the company said its earnings per share (EPS) increased to Tk 0.73 for October-December 2021, up by a whopping 2333 per cent, from Tk 0.03 in the corresponding period.

The cotton yarn manufacturer's EPS for six months until December, 2021, also rose to Tk 0.97 as against loss of Tk 0.39 per share in July-December, 2020.

The net operating cash flow per share (NOCFPS) was Tk 4.33 for July-December 2021 as against minus Tk 7.54 for July-December 2020.

The company's net asset value (NAV) per share was Tk 19.13 as on December 31, 2021 and Tk. 18.16 as on June 30, 2021.

The effect of production and sales from the new Ring Spinning Unit and full capacity utilisation at Rotor unit, as well as the current price hike of yarn helps the company to get high growth in all indicators, said the company in the filing.

The new unit of Mozaffar Spinning, .which went into commercial operation in January 2021, has made a significant contribution to revenue and profit growth, said a top official of the company.

"Thanks to the production at the new plant and the growing demand of yarn, the company has seen a big jump in turnover as well as profit," he said.

Last year the factory had to shut down a number of rotor machines for expanding the capacity. A fire incident at the factory also hampered the production for several days. These have impacted its previous year's earnings, he added.

The company's share price fell by 2.22 per cent to close at Tk 30.80 on Wednesday despite the higher profit news. Its shares traded between Tk 11.80 and Tk 34.20 in the last one year.

The company disbursed 3.0 per cent cash dividend for the year ended on June 30, 2021. In 2020, it paid only 1.0 per cent cash dividend.

The company's paid-up capital is Tk 1.0 billion, authorised capital is Tk 3.0 billion and the total number of securities is 100.99 million.

The sponsor-directors own 39.61 per cent stakes in the company while the institutional investors own 21.24 per cent, foreign investors 0.04 per cent and the general public 39.11 per cent as of December 31, 2021, the DSE data shows.

Meanwhile, the board of directors of the company has decided to hold an extraordinary general meeting to add a new clause as under the object clause (Clause-III) of the memorandum of association of the company.

The EGM will be held on March 5 at 11:30am using the digital platform. The record date for the EGM is set on February 9, according to another disclosure on Wednesday.

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