Unity Foods Limited has announced a remarkable turnaround in its financial performance for the six months ending December 31, 2024. The company posted a net profit of Rs830 million, a sharp contrast to the Rs471 million loss recorded during the same period in the previous year.
The earnings per share (EPS) improved significantly to Rs 0.7, compared to a loss per share of Rs0.39 in the prior year, marking a strong rebound.
The company’s profit growth was largely driven by a 249.3% increase in other income, which soared to Rs1.64 billion. This boost contributed to a 33.5% rise in operating profit, which reached Rs4.81 billion, up from Rs3.61 billion last year.
However, the company faced challenges on the revenue front, as net turnover declined by 24.7% year-on-year, falling to Rs34.90 billion from Rs46.33 billion. This decline was primarily due to a 24.8% drop in gross sales and a 26.6% decrease in sales tax and discounts.
Unity Foods made notable strides in managing its costs. The cost of sales decreased by 27.5%, bringing it down to Rs30.01 billion, which helped to slightly improve the gross profit to Rs4.89 billion—a marginal 0.4% dip from the previous year.
The company’s selling and distribution expenses were slashed by 33.4%, totalling Rs918 million, while administrative expenses were reduced by 3.7% to Rs666 million.
Despite strong operational improvements, finance costs rose by 8.9%, amounting to Rs3.93 billion, which impacted the company’s pre-tax earnings. Nevertheless, profit before taxation still swung to a gain of Rs504 million, compared to a loss of Rs422 million last year.
The company’s net profit of Rs 830 million for the period was largely driven by Rs 504 million from continuing operations, while the remaining Rs 326 million came from discontinued operations.
The latest results reflect a combination of improved cost efficiency, strong other income, and strategic cost-cutting measures, allowing Unity Foods to recover from last year’s loss and position itself for future growth.
Since the announcement of the company’s financials, the company’s stock price has gone up by more than 3%, indicating a positive uptake by the market. This marks a positive momentum in the company’s stock price which has otherwise been on a downhill journey over the past one month.
Consolidated Financial Results for the Period Ending December 31, 2024
- Turnover (net): Rs34.90 billion (down 24.7% from Rs46.33 billion)
- Gross profit: Rs4.89 billion (down 0.4% from Rs4.91 billion)
- Operating profit: Rs4.81 billion (up 33.5% from Rs3.61 billion)
- Profit before taxation: Rs504 million (from a loss of Rs422 million)
- Net profit: Rs830 million (from a loss of Rs471 million)
Unity Foods’ efforts in managing operational efficiencies and securing additional income streams have placed the company on a promising trajectory despite challenges in the core revenue streams.
