BM Desk: Summit Power secured a remarkable 51 per cent year-on-year growth in profit to Tk 3.34 billion in FY24, driven by lower import costs amid stable foreign exchange rates. Its consolidated earnings per share (EPS) rose to Tk 3.13 in FY24 from Tk 2.07 the year before, according to a stock exchange filing on Tuesday.

The stable foreign exchange rates in FY24, compared to the previous year, contributed to the yearon-year profit growth, said the company in its earnings note. Operations of power companies depend mostly on imports, and so when the taka loses its value against the dollar, pricier fuel in the global market gets even pricier, denting companies’ bottom-line growth. Summit Power explained that import cost of heavy fuel oil (HFO) was higher in FY23 compared to FY24.

The cost of sales, which includes all associated costs to produce power, stood at Tk 23.60 billion, which was 78 per cent of revenue earned in the nine months through March last year, down from 85 per cent of the revenue in the same period a year ago. The annual figures of cost of sales and revenue are yet to be available. Owing to policy measures taken by the Bangladesh Bank, the dollar-taka exchange rates remained stable in FY24, compared to the previous year, narrowing the gap between formal and kerb markets. Moreover, the central bank stopped day-to-day interference in the forex market, which also helped ease rate fluctuations, bankers say. As a result, Summit Power’s exchange loss in foreign currency transactions fell in FY24.

Apart from stable foreign exchange rates, a reduction in the cost of power generation, due to a decline in the price of furnace oil in the global market, also helped the company secure a higher profit in the year. Meanwhile, there was a rise in bulk tariffs for electricity. The government in March last year raised the bulk electricity price by 5 per cent on an average to Tk 7.04 per unit. Summit Power declared a 10 per cent cash dividend