Pandemic Helps Drug and Personal Care Manufacturers Record Strong Sales Increase
Most of the listed pharmaceutical and chemical companies recorded a higher profit in fiscal year 2020-2021 compared to the previous year thanks to increased sales during the Covid-19 pandemic.
Eight of the companies will pay a higher dividend than the previous year, four will pay the same amount as a year ago while three companies, which reported declining profits, will reduce their dividend.
Medicines and hygiene products manufactured by pharmaceutical and chemical companies saw a sharp increase in sales during the pandemic.
This has helped pharmaceutical companies nationwide post good growth in revenue and earnings from the prior year, according to industry insiders.
Until November 8, 20 out of 31, including two listed foreign multinationals in the pharmaceutical and chemical sector, published their annual accounts for the 2020-2021 fiscal year.
Eleven of the companies reported increased profits, and nine reported lower profits from a year ago, according to an analysis by The Business Standard.
The rest of the companies in this sector have yet to release their annual financial statements and declare a dividend to shareholders.
According to available data, three companies suffered losses. Of these, two had also suffered losses in the previous fiscal year.
Two other companies returned to profit the previous year, they suffered losses in the previous year.
According to industry insiders, the pharmaceutical industry’s annual growth could reach 15-16% this decade, up from 12.1% in the past five years.
The pandemic helped the industry achieve a staggering 18.56% growth in fiscal year 2020-21.
Beximco Pharmaceuticals, Square Pharmaceuticals and Renata are in the Tk 500-plus club among dozens of publicly traded companies nationwide.
In the pandemic, these companies reported a sharp increase in their profits in the outgoing fiscal year.
Beximco Pharmaceuticals profit increased 46% in FY21. Its consolidated earnings per share (EPS) amounted to 11.49 Tk, against 7.88 Tk in the previous financial year.
Company officials said profits increased due to the organic growth of its business, which was in part attributable to income from vaccine distribution and increased cash incentives from exports.
Square Pharmaceuticals – the industry leader – posted a 19% increase in profits and EPS rose to Tk 17.99 from Tk 15.07 the previous year.
He said in an annual statement, growth is in his core business. Sales of pharmaceuticals had a positive impact on BPA.
Renata, the descendant of Pfizer Bangladesh, posted a 26% profit increase. Its EPS fell from Tk 41.14 to Tk 51.94 the previous year.
Orion Pharma recorded a 41% increase in profit in FY21. Its consolidated EPS fell from 2.84 Tk to 4.1 Tk during the previous financial year.
IBN Sina Pharmaceutical’s profit increased by 26%. Its EPS increased to Tk15.66 from Tk12.56 in the previous year.
Md Kabir Hossain, general secretary of IBN Sina, recently told The Business Standard: âIn the midst of the pandemic, our income from the sale of medicines has increased dramatically. As a result, our profits increased compared to the previous year.
ACI Formulations, a manufacturer and supplier of agrochemicals, recorded a 130% increase in profits over the previous year. Its EPS was 4.74 Tk, compared to 2.06 Tk the previous year.
Advanced Chemical Industries (ACI) Limited – one of the nation’s largest pharmaceutical conglomerates and manufacturers – returned to profit in the last fiscal year.
This fiscal year, ACI’s EPS reached 5.5 Tk. The previous year, its loss per share was Tk 16.78.
In addition, ACME Laboratories, Global Heavy Chemicals, Kohinoor Chemicals Company (Bangladesh) and Silva Pharmaceuticals posted higher profits than last year.
On the other hand, Beximco Synthetics, Central Pharmaceuticals and Far Chemical Industries suffered losses.
In which, Beximco Synthetics and Central Pharmaceuticals continued to incur losses as in the previous year.
Therefore, they will not pay any dividends to their shareholders.
Far Chemicals Industries is a newcomer among loss-making companies in the pharmaceutical industry, and despite the losses, the company will pay a 1% cash dividend.