Net profit of the government-owned public enterprises has decreased marginally in the fiscal year 2019/20.
According to the Economic Survey for the fiscal year 2020/21 published by Finance Minister Bishnu Prasad Paudel on Friday, the net profit of public enterprises decreased by 1.21 per cent to Rs. 48.29 billion in the fiscal year 2019/20 as compared to the previous fiscal year.
Despite the decline in profits, the dividend payment rate has increased significantly during the review period compared to the previous fiscal year. In the fiscal year 2019/20, the government received a total of Rs. 14.99 billion dividend from the public enterprises.
This amount is 48.87 per cent more than the previous year. Public enterprises had made a profit of Rs. 48.77 billion in fiscal year 2018/19.
Out of that, only Rs. 9.47 billion was paid as dividend. Although the overall economy has been affected in the fiscal year 2019/20 due to the measures taken for the prevention, treatment and control of COVID-19 infection, the overall financial position of the public enterprises has remained satisfactory despite some contraction in the performance of them, read the survey report.
In FY 2019/20, the accumulated profit increased by 18.19 per cent to Rs. 109.74 billion. Accumulated losses decreased by 0.93 per cent to Rs. 34.23 billion.The accumulated profit of all corporations (after deducting accumulated losses) increased by 29.53 per cent to Rs. 75.51 billion, the report said.
Out of the existing 44 public enterprises, 24 corporations have made profit, two corporations have zero turnover and 18 corporations have incurred losses. Janakpur Cigarette Factory is closed while Electricity Generation Company and National Transmission Grid Company are in the stage to start their businesses.
Among the companies operating at losses, Nepal Oriental Magnetite Pvt. Ltd. and Butwal Yarn Factory have no commercial business. As Nepal Railway Company is under construction, it is running at loss.
Out of the existing public enterprises, only 38 public corporations are in operation.Of the existing 44 corporations till FY 2019/20, 23 are wholly owned by the government, 21 are owned with majority (more than 50 per cent owned by the government and other government bodies).
In FY 2019/20, net profit of 24 corporations increased by 4.28 per cent and net loss of 18 corporations increased by 99.46 per cent. Likewise, administrative expenses of public enterprises have increased by 12.68 per cent during the review period.
The net worth of the shareholders of the public enterprises has increased by 13.11 per cent and reached Rs. 703.90 billion. During the review period, the total investment of the government in the corporations increased by 11.82 per cent to Rs. 519.55 billion.
Source : THE RISING NEPAL,
