Summit Power has announced a profit decline of over 37 percent for the first half of FY25, reporting earnings of Tk 1.15 billion, a decrease compared to the same timeframe last year, attributed to rising costs and reduced demand.

The company’s consolidated earnings per share (EPS) dropped to Tk 1.15 in H1 FY25, down from Tk 1.71 in H1 FY24, as per the latest unaudited financial reports.

In its disclosure, Summit identified four key factors contributing to the profit reduction.

Firstly, the government did not renew the power purchase agreement (PPA) for one of Summit’s facilities after it expired. Additionally, another plant operated only partially due to a lack of demand from the national load dispatch center. Furthermore, three other power plants, following the renewal of their contracts with the government, operated under a “No Electricity, No Payment” arrangement, which meant they did not receive any capacity payments during that period.

The fourth reason cited was an increase in income tax expenses, which rose to Tk 96.4 million over the six months ending December last year, compared to Tk 49.5 million in the same period the previous year.

According to Summit’s financial report, revenue saw an 11 percent year-on-year increase during this period, although the cost of goods sold surged by 18 percent year-on-year.

Summit released its financial statements for both Q1 and Q2 of FY25 on Saturday, having been granted an extension for their submission.

On the Dhaka Stock Exchange (DSE), Summit Power’s shares closed at Tk 15.70 each last Thursday.

Once regarded as a highly promising company, Summit Power has faced challenges in its growth trajectory due to changes in the government’s power purchase policy.

In FY24, Summit Power achieved a profit of Tk 3.34 billion, benefiting from lower import costs amid stable foreign exchange rates.