It reported a profit of Tk 401.54 million in FY26, as opposed to a loss of Tk 1.25 billion in FY25, backed by a reduction in system loss and an increase in income from fixed deposit receipts (FDRs). Also, foreign exchange losses fell significantly in FY26 compared to the previous year, driving up earnings.
According to company officials, DESCO’s system losses were cut to 5.47 per cent in FY26 from 5.5 per cent in the previous year. The installation of prepaid meters helped reduce losses by 0.03 percentage points.
“After years of losses, what we mainly did was we slashed costs. We cut back on administrative and operating expenses. The main impact was on exchange losses—foreign exchange losses. We reduced those,” said DESCO’s Managing Director Brig. Gen. Shameem Ahmed.
Moreover, the rise in prepaid meters played a vital role in boosting sales revenue.
The number of prepaid meters was 877,835 in Dhaka as of June last year, which rose to 955,036 by June this year. Also, DESCO cut illegal connections, which resulted in revenue growth.
DESCO has 24 offices operating across Dhaka. They snapped illegal connections in rickshaw garages, settlements, bazaars and markets. That also reduced leakage.
The preventive measures helped the company secure additional revenue of more than Tk 4.32 billion from electricity sales in FY26, according to DESCO.
The company has substantial foreign-currency loans, including loans from development partners such as the Asian Development Bank (ADB) and the Japan International Cooperation Agency (JICA).
It suffers foreign exchange losses if the local currency depreciates against the dollar.
DESCO’s foreign-exchange fluctuation loss was Tk 2.43 billion in FY24, which declined to Tk 1.69 billion in FY25. In FY26, the company recorded a foreign exchange gain of Tk 44.2 million.
Mr Ahmed said the dollar price had gone up in the middle of FY26 and then dropped slightly, resulting in the gain.
Higher revenue, improved operating efficiency and better cost management strengthened operating margins.
The company’s managing director said DESCO’s revenue recovery was supported by changes in electricity consumption patterns across different tariff slabs, rather than simply by an increase in electricity rates.
The key point is that customers in higher-consumption slabs potentially allowed DESCO to recover costs more effectively.
Consumption in the lower slabs, up to 400 units, is described as being priced below DESCO’s bulk electricity purchase rate, suggesting that revenue from these categories does not cover the costs of electricity procurement. By contrast, when consumption exceeds 600 units, the revenue generated covers the associated costs.
Higher consumption in the upper slabs forged a more favourable relationship between electricity sales revenue and the cost of electricity purchase.
In addition to improved profitability, DESCO recorded stronger operating cash flow. Net operating cash flow per share (NOCFPS) increased from Tk 15.93 in FY25 to Tk 17.99 in FY26.
This indicates strong cash management alongside the return to profit. Better customer collections, working-capital management and changes in the payment method contributed to the increased cash flow.
DESCO’s balance-sheet position also improved, with net asset value (NAV) per share rising from Tk 35.33 in FY25 to Tk 39.23 in FY26, an increase of 11.04 per cent. This reversed the downward pressure on NAV in the previous three years.
However, FY26 NAV remains approximately 40.5 per cent below FY22 NAV of Tk 65.96, suggesting that the recovery in shareholders’ net assets remains incomplete.
The board of directors of DESCO has recommended a 5 per cent cash dividend for FY26 for ordinary shareholders. So, shareholders, excluding sponsors, will receive Tk 0.50 for each share of Tk 10.
Overall, DESCO’s financial performance in FY26 demonstrates a meaningful recovery in earnings, net assets and operating cash generation.
The key challenge is to convert this one-year recovery into sustained profitability, stronger financial resilience and consistent shareholder returns.
