Profits of state-run companies dropped 20% in first quarter

The profit of state-owned enterprises (SOEs) declined 20 percent in the first quarter of 2024, reports the Privatization and Corporatization Board (PCB).

In its Quarterly Review, PCB reports the total revenue of all SOEs stood at MVR 13.74 billion in the review quarter, which is a 5 percent increase from the MVR 13.09 billion observed in the same quarter last year.

However, despite a marginal increase in revenues, the total profit of all SOEs for the review quarter was MVR 1.69 billion, which is a 20 percent decline from the MVR 2.10 billion observed in the first quarter of 2023.

The self sufficient SOEs reported a total revenue of MVR 13.52 billion, with a profit of MVR 1.76 billion. From the self sufficient SOEs, the highest increase in net profit was observed in Island Aviation Services (IAS), with a net profit increase of 344 percent from MVR 12.64 million in Q1-2023 to MVR 56.17 million in 2024 first quarter.

Out of all the self sufficient SOEs, the Maldives Transport and Contracting Company (MTCC) observed the most staggering profit decline, registering a negative 88 percent. MTCC’s net profit plummeted from MVR 45.06 million in the first quarter of 2023 just MVR 5.24 million in Q1-2024.

Top SOEs – In Terms of Percentage Increase in Net Profit

1. Island Aviation Services (IAS) – MVR 12.64 million (Q1-2023) to MVR MVR 56.17 million (Q1-2024) | +344%
2. Male’ Water & Sewerage Company (MWSC) – MVR 35.99 million (Q1-2023) to MVR 76.29 million (Q1-2024) | +112%
3. SME Development Finance Corporation (SDFC) – MVR 53.22 million (loss) (Q1-2023) to MVR 20.40 million (loss) (Q1-2024) | +62%
4. Maldives Islamic Bank (MIB) – MVR 42.30 million (Q1-2023) to MVR 56.00 million (Q1-2024) | +32%
5. Maldives Ports Limited (MPL) – MVR 7.00 million (Q1-2023) to MVR 8.93 million (Q1-2024) | +28%

On the other hand, budget-supported SOEs reported a revenue of just MVR 215 million and a net loss of MVR 75 million.

In terms of percentage improvement, the most profitable budget-supported SOE for the review quarter is Waste Management Corporation (WAMCO), that saw an 88 percent increment.

Maldives Post is however, the only profit generating company out of the entire budget-supported SOEs category for the review quarter, and reported a net profit of MVR 6.49 million in Q1-2024 compared to MVR 4.33 million in the same quarter last year.

The other budget-supported SOEs, either saw their losses increase for the review quarter or decrease. As such, WAMCO, which observed a net loss of MVR 28.27 million in Q1-2023 had observed a net loss of just MVR 3.46 million in the review quarter, making it the biggest upwards percentile jump during Q1-2024.

The state contributed MVR 60.47 million in grants to SOEs during Q1-2024, which is a 3 percent growth from the MVR 58.91 million in grants extended in the first quarter last year. Government also extended MVR 1.22 billion in subsidies during the review quarter, marking a 2 percent increase from the MVR 1.19 billion in Q1-2023.

As for capital injection, state had provided MVR 164.94 million to SOEs, which is a 9 percent increase from the MVR 151.19 million provided in the first quarter last year.

In terms of value, the government facilitated the highest amount to Maldives Airports Company Limited (MACL) in loans and borrowings, which stood at MVR 11.64 billion in Q1-2024 compared to the MVR 9.45 billion in the same quarter last year; indicating a year-over-year increment of MVR 2.19 billion, which is a 23 percent increase.

Fahi Dhiriulhun Corporation (FDC) reported the second highest loan and borrowings for the review quarter, at MVR 1.83 billion, which is an MVR 599.21 million increase from the MVR 1.23 billion in the same quarter of 2023.

According to PCB statistics, only 11 SOEs reported positive percentage momentum for the review quarter out of the 30 companies.