Renata PLC, a leading Bangladeshi drug manufacturer, has revealed impressive profit growth in the January to March period of 2023-24, attributed to higher sales and effective cost management strategies.

In the third quarter, the company’s profit surged by 21.4 percent year-on-year to Tk 0.72 billion, with earnings per share reaching Tk 6.33, up from Tk 5.18 in the corresponding period of the previous year.

Renata’s sales also witnessed a notable increase, rising by 9 percent year-on-year to Tk 9.21 billion in the three-month period ending in March this year, according to data disclosed during a board meeting held on Monday.

Jubayer Alam, the company secretary of Renata PLC, highlighted the factors behind the robust financial performance, stating, “Higher sales contributed to achieving higher profits while effective cost management played a significant role in achieving a better bottom line.”

Despite facing challenges such as increased finance costs due to currency devaluation and high interest expenses, Renata embarked on a strategic cost management program, yielding positive results.

The company’s operating costs dropped approximately 1 percent year-on-year to Tk 3.02 billion in the January-March quarter, a noteworthy achievement considering the typical rise in operating costs observed every quarter.

However, in the nine months leading up to March this year, Renata’s profits experienced a slight decline of 4 percent year-on-year to Tk 2.58 billion, with earnings per share falling to Tk 22.54 from Tk 23.47 in the same quarter of 2022-23. Despite this, the company’s cumulative profit in three quarters surpassed the total profits earned in the previous financial year, totaling Tk 2.33 billion.

Alam expressed optimism regarding Renata’s future performance, stating, “Since we have exceeded last year’s profit in just three quarters, even a modest performance in the fourth quarter would fuel growth significantly.”

Renata PLC’s revenue growth of 14 percent year-to-date was spread across its core businesses, including pharmaceuticals, animal health, and contract manufacturing.

The company’s significant investments in capacity expansion and new technologies have been notable in recent years. In the current financial year, Renata has invested Tk 3.30 billion in various areas such as automated warehouse, injectable facility, oncology solid, extensions of multiple depots, and power plant. 

Substantial investments have also been made in product development and research and development, with the company having developed 70 bioequivalent products sold in 44 countries, including Bangladesh.

Despite today’s slight decline in stock prices, Renata remains a robust player in the pharmaceutical industry, with a paid-up capital of Tk 1.14 billion and reserve and surplus amounting to Tk 29.12 billion, according to data from the Dhaka Stock Exchange (DSE). The company provided 62.5 percent cash dividends to its shareholders for the financial year 2022-23.