Bata shoe country’s leading multinational shoe seller reported a 85 percent drop in sales and experienced a net loss during the period (second quarter) compared to the previous year due to coronavirus pandemic.
The company registered a Tk 204 crore sales in the first six months (January-June) 2020 against the previous year six mnth sales worth Tk 405 crore.
“The company, which trade in leather shoes has never had such a problem in the Bangladeshi market. Sales of our company have decreased a lot due to Corona.” the secretary of the company Hashem Reza told Business Mirror.
The reason for the big losses in the April-June quarter, according to the Bata Shoe authorities, is that usually 25 per cent of the business is Eid-centric and high-priced products are sold more, which leads to higher profits. But due to the epidemic, this opportunity has been missed. Compared to the same period last year, this time the income has been only 15 percent.
Coronavirus, which has spread all over the world, was first identified in Bangladesh on March 8. As a result, the government declared a seven-day general holiday from March 26 to May 30. Basically, the company’s income has gone down to this time. In addition, before Eid-ul-Fitr, the biggest religious festival of the Muslims, Eid-centric shopping has come to a standstill due to the Corona outbreak. As a result, Eid-centric businesses have the most negative impact on Bata Shoe.
Meanwhile, in the April-June quarter of this year, the company’s loss per share stood at Tk 53.74 against the last years profit worth Tk 15.75.
On the other hand, the company has incurred a loss of Tk 6 crore at the end of the second quarter of this year after covering all the expenses. At the same time last year, the company’s profit was about Tk 36 crore. Earlier, the company was consistently profitable. Last year, the company’s profit was Tk 99 crore. The company has been paying more than 300 percent cash dividend for the past four years.
Meanwhile, the multinational company is currently in a cash crunch. According to Operating Cash Flow, the operating cash flow per share during January-June this year stood (negative) at Tk 5.75 from Tk 43.48 paise in the same period last year.