SS Steel’s earnings decline 30%, still offers dividends

The earnings of SS Steel Limited have declined by 30% due to the Covid-19 pandemic, but its board of directors has still recommended 2% cash dividend for general shareholders, other than sponsors and directors.

The company has also offered another 8% stock dividends for all shareholders. 

Earnings per share (EPS) of the company went down to Tk 1.55 in the 2019-20 fiscal year from Tk2.46 in FY19.

In a statement published on the Dhaka Stock Exchange (DSE) website on Monday, the company informed that the significant deviations in EPS were due to the outbreak of the deadly coronavirus. The company’s revenues declined compared to the last year, resulting in a decrease in EPS. 

According to the statement, sponsors and directors hold 115,469,343 shares out of 281,750,00 total shares of the company. The cash dividend payable to the general shareholders is Tk3.33 crore. 

The net asset value (NAV) per share — with revaluation — of the company stood at Tk17.48 while NAV per share without revaluation is Tk14.98 for FY20, against Tk18.33 and Tk15.40 for the previous fiscal year. 

Meanwhile, the company also reported net operating cash flow per share (NOCFPS) of Tk2.46 for FY20 against Tk0.93 for FY19. 

The company said that the cash flow had increased because it received more cash from customers than in the previous fiscal year. On the other hand, cash outflow for suppliers and other payments had also decreased. 

The board of SS Steel also approved Tk10.50 crore for purchasing land, building and capital machinery for business expansion. 

In its statement, the company also informed that the bonus shares have been recommended to utilise its retained amount as capital for business expansion and that the bonus shares are declared out of accumulated profit.

It further said that the bonus shares are not declared from the capital reserve of the company, by revaluating reserves or any unrealised gains, or out of profit earned prior to incorporation of the company.

The company also said that the bonus shares are not declared through reducing paid-up capital or through doing anything so that the post dividend retained earnings become negative or a debit balance. 

Following the corporate declaration, there will be no price limit on the trading of the shares of the company. However, the floor price set by the Bangladesh Securities Exchange Commission (BSEC) will be applicable accordingly.

The annual general meeting of the company is scheduled to take place on December 31 on a digital platform.