Bottlers Nepal, a prominent player in the beverage industry, has witnessed a decline in net profits for both of its companies, Bottlers Nepal (BNL) and Bottlers Nepal (Tarai) (BNT), during the third quarter of the current fiscal year. The financial performance of these companies reflects the challenges faced in the beverage sector and the impact on profitability.
Bottlers Nepal (BNL):
BNL’s net profit plunged by a staggering 91.10 percent, dropping to Rs 35.7 million from Rs 402.2 million in the corresponding period of the previous fiscal year. This significant decline can be attributed to a substantial decrease in operating income, which fell to Rs 7.18 billion from Rs 8.21 billion during the review period. Consequently, the company’s total profit also declined, reaching Rs 2.04 billion from Rs 2.28 billion.
Earnings per Share (EPS) and Valuations:
BNL’s EPS took a hit, declining by Rs 275 to Rs 24, while its price-to-earnings (P/E) ratio stood at an elevated 691 times. The company’s net worth per share was recorded at Rs 3,229. With a paid-up capital of Rs 194.8 million, BNL has a reserve fund of Rs 5.70 billion.
Bottlers Nepal (Tarai) (BNT):
BNT, the other subsidiary of Bottlers Nepal, also experienced a decline in net profit, dropping by 27.58 percent to Rs 261.4 million from Rs 361 million in the corresponding period of the previous fiscal year. The company’s operating income fell to Rs 5.81 billion from the previous Rs 5.99 billion, while its operating profit declined to Rs 486.7 million from Rs 588.8 million. However, BNT’s total profit increased marginally to Rs 1.59 billion from Rs 1.58 billion.
Financial Metrics:
BNT reported an EPS of Rs 288, a P/E ratio of 44 times, and a net worth per share of Rs 3,397. With a paid-up capital of Rs 121 million, the company has a reserve fund of Rs 3.98 billion.
Industry Challenges and Outlook:
The declines in net profits for both BNL and BNT highlight the challenges faced by the beverage industry in Nepal. Factors such as changing consumer preferences, competition, and economic conditions may have contributed to the dip in profitability. As the companies navigate these challenges, investors and stakeholders will closely monitor their strategies and performance in the coming quarters.
