Singer, a leading consumer durables retailer in Bangladesh, has demonstrated impressive financial performance for the year 2023. After facing challenges in maintaining profitability due to the global coronavirus pandemic, the company is now evidencing signs of resurgence amid the tough macroeconomic climate of Bangladesh.
In 2023, Singer announced a profit of Tk 522.1 million, a figure sixfold greater than that of 2022. Let’s explore the key factors behind this remarkable recovery.
Double-digit Gross Profit Growth
Despite a slight decline in sales, Singer achieved substantial growth in gross profit in 2023. The company reported sales amounting to Tk 17,033.1 million for the year, marking a modest 0.4% decrease from 2022.
Read more: Singer Bangladesh Launches The Country’s First Concept Store
This trend isn’t unexpected, given the significant macroeconomic challenges faced by the country, including high inflation, increased interest expenses, and the depreciation of the local currency. In such periods of high inflation, consumers often postpone purchases of durable goods, prioritizing essential items instead.
Yet, the company managed to secure double-digit growth in gross profit, primarily driven by an enhancement in gross profit margins. These margins rose from 23.0% in 2022 to 28.8% in 2023. The lower gross profit margin in 2022 was a result of the company providing greater discounts to boost sales.
Heightened Operational Efficiency Fuels Sixfold Profit Increase
In the face of rising inflation, the company successfully managed its operating expenses, which saw a 13.6% year-over-year increase in 2023. Consequently, Singer’s operating profit soared by 56.8% year-over-year, reaching Tk 1,478.2 million in 2023.
The substantial increase in operating profit, coupled with a modest rise in financing expenses, culminated in a profit of Tk 522.1 million in 2023. Financing expenses grew by just 10.0% year-over-year to Tk 604.1 million in 2023.
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