Unilever Nepal Limited posted a profit of Rs. 22.70 crores, a growth of mere 4.4% in the year 2010/11. The company cited rising costs of raw material as the major hurdle for such profits despite the fact that the revenue rose by 21.57% in the previous year.
The sales of Rs. 108.13 crores compared to Rs 88.94 crores previous year did not bring about major increment in the gross profit margins. The gross profit margin decreased by 259 basis points from 44.30 to 41.71 percentage points. The decrease in margins and rising costs of promotions eroded the profits of the company.
The company has a cash balance of Rs. 10.7 crores.
The EPS of the company improved by Rs. 11 from 236 to Rs. 247 with an increase of 4.4%. The price earnings ratio of 19.39 compared to 17.57 previous year.
The company had declared a cash dividend of 560% for the year 2066/67 (2009/10). Though company just made a profit of Rs. 247 per share, the same dividend as previous year would be dificult. The share price should adjust.
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