Their packaging offerings cater to food and beverage companies as well as non-food entities such as lamination, over wrapping, bag making, etc. They sell in the domestic markets as well export globally, although domestic sales make a large part of their total sales. Some of their export markets include Bangladesh, Middle East, Kenya, South Africa, etc.

Shareholding pattern

A considerable part of the company is owned by associated companies, undertakings and related parties. Nearly 63 percent of shares are held by Packages Limited. Another key shareholder of the company is the local general public at 21 percent followed by 'others'. The remaining ownership is distributed between the remainder categories as depicted in the table.

Tri-Pack Films Limited's top-line has registered continuous growth in the last decade with the exception of CY15 and CY16, while CY16 was the most profitable year, recording the highest profit margins.During CY14, TRIPF's top-line increased by almost 14 percent, while in volumetric terms the top-line registered a growth of 11 percent. The overall economy was marred by political instability and energy shortages along with a poor law and order situation. Moreover, the industry faced the menace of illegal imports which adversely affected margins and volumes, in general.

In CY15, TRIPF's sales revenue declined by 12 percent. The company's top-line is largely driven by FMCG growth. It is observed that during the year, FMCG volumes were lower hence resulting in 3 percent decline for TRIPF's sales volume. Moreover, according to the company's annual report for the year, about 7 percent of the BOPP demand was catered by illegal goods smuggled via the Afghan transit trade. Combined with this, the oversupply in the CPP segment and fluctuation in the price of raw materials rendered the task of product pricing a challenge. An across the board control on costs resulted in a profit for the year of Rs498 million as compared to a loss of Rs200 million in the preceding year.

Between the nine months ended CY18 and CY19, TRIPF registered a growth in top-line of almost 8 percent while an increase of 5 percent was noted in volumes. During CY19, the economy experienced challenging times with high inflation and policy rates, and significant efforts to document the economy. However, the strict laws imposed on the unregistered sector adversely impacted the demand since it made a large portion of the market. The inflationary pressures along with change in tax laws eventually led the company to incur a loss of Rs393 million during 9MCY19.

As per the company's recent report, it foresees a recovery in volumes with the stabilization of the currency and the economy at large. Since TRIPF's demand is derived from the growth of FMCG, a stabilization in the economy would encourage consumer spending and hence the company's demand. With a focus on operational and cost efficiency the company will be able to recover from the period of loss.

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TRIPF: Quarterly results
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Rs (mn)                         9MCY18      9MCY18         YoY
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Net revenue                     10,623       9,851       7.84%
Cost of sales                  (9,524)     (8,769)       8.61%
Gross profit                     1,099       1,082       1.57%
Distribution costs               (337)       (278)      21.22%
Administrative expenses          (248)       (228)       8.77%
Operating profit                   514         576     -10.76%
Other income                        46          39      17.95%
Other expenses                     (1)        (21)     -95.24%
Finance cost                     (668)       (338)      97.63%
Profit/(loss) before taxati      (109)         256    -142.58%
Taxation                         (284)        (22)    1190.91%
Profit after taxation            (393)         234    -267.95%
EPS                            (10.14)        6.03
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Source: Company accounts

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TRIPF: Pattern of shareholding as at December 31, 2018
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Categories of shareholders                                   %
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Directors, CEO, their spouses and minor children          2.22
Associated companies, undertakings and related parties   62.98
Insurance companies                                       1.91
Modarabas and mutual funds                                1.92
General public:
Local                                                    21.36
Foreign                                                   2.58
Others                                                    7.03
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Total                                                      100
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Source: Company accounts

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                                  CY13      CY14    CY15    CY16    CY17    CY18
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Return on equity (%)               1.5   (12.20)    23.6    19.9    14.5     4.2
Return on capital employed (%)      10       9.5      22      22    21.1    14.7
Current ratio (times)              0.9       0.9     0.8     1.1     0.9     0.9
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Source: Company accounts

Copyright Business Recorder, 2020