Divyashwori Hydropower Limited has successfully turned its losses into a net profit in the fourth quarter of the fiscal year 2082/83, driven by a 16.11 percent increase in electricity sales income.
Divyashwori Hydropower Limited recently released its unaudited financial statements for the fourth quarter of the fiscal year 2082/83. According to the published report, the company, which was in a net loss in the previous fiscal year, has now returned to profitability during the review period.
In the corresponding period of the previous fiscal year, Divyashwori Hydropower faced a net loss of Rs. 68 lakh 63 thousand. However, in the current review period, the company has managed to earn a net profit of Rs. 1 crore 45 lakh 55 thousand.
The main factors contributing to the company’s return to profit were an increase in operating income due to regular operation and maintenance of the power plant, which boosted electricity production, and a reduction in its finance cost.
Up to the fourth quarter, Divyashwori Hydropower’s electricity sales income increased by 16.11 percent, reaching Rs. 10 crore 44 lakh 18 thousand. Gross profit saw a 24.63 percent rise, reaching Rs. 9 crore 92 lakh 2 thousand, while operating profit climbed by 38.26 percent to Rs. 5 crore 50 lakh 64 thousand. Additionally, the company’s finance cost also seen a decline of 13.37 percent, settling at Rs. 3 crore 99 lakh 59 thousand.
The company’s paid-up capital stands at Rs. 26 crore 40 lakh. Its Reserve and Surplus, which was negative Rs. 25 crore 64 lakh 30 thousand in the previous year, showed a 5.68 percent improvement, reducing its negative balance to Rs. 24 crore 18 lakh 75 thousand during the review period.
With the improvement in profit, the company’s earnings per share (EPS) has also turned positive. Previously negative Rs. 2.60, the EPS has now increased to Rs. 5.51. Similarly, net worth per share improved from Rs. 3.40 to Rs. 8.38, and the price-to-earnings (P/E) ratio is currently 49 times.
The company stated that electricity production from its project is affected during the winter season due to low water flow in the river. It also mentioned that past issues with the capacity of the 33 kV transmission line had impacted electricity production and revenue. As a result, the company faced difficulties in regularly repaying its bank loan principal and interest, incurring penalty interest charges.
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