Olympic’s Revenue Grew By 16.3% In 9M’21-222 min read
Olympic Industries Ltd. one of the leading FMCG companies in Bangladesh has published its financial report for the period Jul 21-Mar’22. Revenue of the company grew by 16.3% YoY from Tk 13,729.8 Mn in 9M’20-21 to Tk 15,962.1 Mn in 9M’21-22. However, the net profit decreased by 35.6% YoY mainly due to lower gross & operating margin.
Revenue of Olympic increased by Tk 2,232.3 Mn compared to the same period last year mainly due to growth in domestic sales. Domestic sales increased by 16.8% YoY from Tk 13,515.0 Mn in 9M’20-21 to Tk 15,778.8 Mn in 9M’21-22. Export sales decreased by 14.7% YoY from Tk 214.8 Mn in 9M’20-21 to Tk 183.3 Mn in 9M’21-22. Despite increased competitiveness, coronavirus, and increased raw materials prices in this fiscal year the company is doing a great job in maintaining its double-digit revenue growth.
Gross profit declined by 5.0% YoY mainly due to higher raw materials prices. Wheat, Palm Oil & Sugar which are the main raw materials for Olympic have increased significantly since the pandemic period. As a result, the cost of goods sold has increased by 25.3% YoY compared to 16.3% YoY of sales. The gross margin in 9M’21-22 was 24.4% which was 29.8% in 9M’20-21.
Olympic’s profit decreased significantly by 35.6% YoY from Tk 1,590.6 Mn in 9M’20-21 to Tk 1,023.7 Mn 9M’21-22. The decrease in profit is mainly due to higher raw materials costs and opex. Administrative and selling expenses increased by 12.0% and 30.8% YoY respectively.
Wheat, one of the main ingredients for confectionery item productions has risen significantly since the Ukraine-Russia war. Both the countries are the top producers of wheat and the war resulted in lower wheat output. Recently India also put an export ban on wheat citing food security and soaring prices as the reason. Hence it will be difficult for Olympic to maintain growth in profits as it will be difficult to pass on the higher costs to the consumers. Although the company is doing pretty well revenue-wise, it is expected that the profitability will suffer till the prices of wheat, sugar, and palm oil don’t decrease.
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