The Nation Newspaper

Tag: first half

  • May & Baker Nigeria grows profit by 534% in first half

    May & Baker Nigeria Plc sustained impressive growth in the first half of this year as net profit rose by 534 per cent to N601.37 million.

    Key extracts of the interim report and accounts of May & Baker Nigeria for the six-month period ended June 30, 2018 submitted to the Nigerian Stock Exchange (NSE) showed that total comprehensive income-which included profit after tax and extra ordinary income rose to N601.37 million in first half 2018 as against N94.86 million recorded in the comparable period of 2017.

    The 534 per cent increase in net distributable earnings has raised strong prospect of possible significant increase in dividend payout to shareholders. The healthcare company had increased its dividend payout by 233 per cent for the 2017 business year after it rounded off the year with significant growths in profitability.

    The report showed a well-rounded improvement in the bottom-line of the healthcare company as key underlying profitability margins improved considerably during the period. Pre-tax profit margin-which measures average pre-tax profit per unit of sale and serves as benchmark for profitability of the company, tripled from 3.13 per cent in first half 2017 to 8.44 per cent in first half 2018. Gross profit margin had increased from 30 per cent in first half 2017 to 33 per cent in first half 2018 while operating margin also grew to 12.7 per cent in 2018 as against 10.11 per cent recorded in corresponding period of 2017.

    Market analysts said the increase in gross margin, operating margin and pre-tax profit margin showed that the company’s performance in the first half was driven by improved business operations, increased efficiency and better cost management.

    The report showed that group’s profit before tax rose by 178.76 per cent to N388.90 million in first half 2018 as against N139.51 million recorded in comparable period of 2017. Profit after tax also leapt by 178.78 per cent from N94.86 million to N264.45 million. Earnings per share thus increased from 9.68 kobo in first half 2017 to 26.98 kobo in first half 2018. With the addition of N336.92 million gain from discontinued operations of its food business , total net earnings jumped to N601.37 million in first half 2018 compared with N94.86 million recorded in first half 2017.

    Group operating profit had increased by 29.9 per cent from N452.25 million to N587.35 million. Gross profit also rose from N1.34 billion to N1.52 billion. Group turnover had increased from N4.47 billion in first half 2017 to N4.61 billion in first half 2018. Further analysis had shown that the company’s finance costs reduced by 36 per cent from N326.87 million in first half 2017 to N209.34 million in first half 2018.

    Business segmentation analysis showed that the performance of the company was driven by its core pharmaceuticals business, which saw 22 per cent growth in sales during the period. The company recorded improvement in sales in all its principal geographical business areas of Lagos, West, East and North.

    Following shareholders’ approval at the Extraordinary General Meeting in November 2017 and approval by the Securities and Exchange Commission (SEC) in February 2018, the foods division of the business ceased operations and was subsequently disposed in April 2018.  The profit of N336.92 million derived from the disposal relate to the excess of proceeds over the carrying amount of the assets at the date of disposal and the incidental expenses thereto.

    Managing Director, May & Baker Nigeria Plc, Mr. Nnamdi Okafor, said It is noteworthy that the company achieved higher turnover in 2018 despite the discontinuation of a significant arm of its business responsible for about 20 per cent of turnover in 2017.

    He said the first half results have again demonstrated the long-term sustainability of the company’s growth strategy and the continuing efficiency of its world-class pharmaceutical manufacturing complex in Ota, Ogun State.

    According to him, the results showed that the group’s core business can sustain long-term value creation for shareholders even as it continues to explore additional opportunities for expansion of the core healthcare business in Nigeria and beyond.

    “Our many growth initiatives are paying off and we are happy that the results have proved us right. With improvement in macroeconomic environment, we will continue to improve on our performance with a view to creating greater value for our shareholders,” Okafor said.

  • Lafarge Africa optimistic despite first-half slowdown

    Lafarge Africa optimistic despite first-half slowdown

    The management of Lafarge Africa Plc yesterday assured that the cement group would deliver stronger performance in the second half after gas shortages, repair works and foreign exchange (forex) significantly impaired performance in the first half.

    During the first half of 2016, Lafarge Africa recorded many achievements in it continuing corporate consolidation including successful acquisition of the balance of 50 per cent ownership stake in United Cement Company of Nigeria (Unicem), which makes Unicem a 100 per cent subsidiary of Lafarge Africa; and a N60 billion bond raised to refinance Unicem’s Naira-denominated debt at a lower interest rate. The Nation recently reported that Lafarge Africa was also considering plan to restructure and refinance the dollar-denominated portion of Unicem debt. These loans were largely used to fund the expansion projects which will add an additional 2.5 metric tonnes per annum cement capacity to the current production capacity of Unicem.

    Lafarge Africa’s first-half report also indicated that its South African cement operations reported solid volume growth, with cement sales volume growing by eight per cent compared to first half 2015 as well as a steady aggregates volume in first half 2016.

    Key extracts of the unaudited report and accounts for the six-month period ended June 30, 2016 however showed declines in sales and profitability. Turnover dropped to N107.36 billion in first half 2016 as against N152.18 billion in comparable period of 2015. As against pre and post tax profit of N30.85 billion and N27.32 billion respectively in first half 2015, the company recorded pre and post tax loss of N30.18 billion and N30.25 billion in first half 2016.

    Chief executive officer, Lafarge Africa Plc, Mr. Michel Puchercos said recent initiatives have strengthened the operational fundamentals of the cement group, noting that the synergies from these will ensure it continues to deliver good performance with significant upsides as it concludes on the integration journey to form Lafarge Africa.

    According to him, the new company is much stronger and better positioned to deliver operational excellence and improve value to shareholders.

    “The second half of the year is anticipated to be more rewarding. We expect the cement market to be strong mainly driven by the individual home segment with a marginal contribution from the public sector. We expect to benefit from the synergies of our integrated operations, in spite of the gas shortages. Our objective is to deliver innovative and good quality building solutions to meet the specific needs of our customers, while also achieving good value creation for our shareholders,” Puchercos said.

     

  • CWG records N8.6b turnover in first half

    Computer Warehouse Group  (CWG) Plc recorded mar-ginal growth in turnover to N8.6 billion in the first half of this year as the information and communication technology company continued to chart the path to predictable growth and returns.

    The six-month report for the period ended June 30, 2015 showed turnover of N8.6 billion in first half 2015 as against N8.4 billion recorded in comparable period of 2014. However, business margins were squeezed from 20 per cent in 2014 to 14 per cent in 2015, as the company was unable to fully pass increased costs to her customers.

    The report showed that there was a seven per cent increase in operating expenses to N1.4 billion in 2015 as against N1.3 billion in 2014. The company blamed the increase in operating expenses on one-off restructuring expenses.

    Executive Director, Finance and Operations, Computer Warehouse Group (CWG) Plc, Mr. Kunle Ayodeji, said the performance of the company in the first half reflected the challenging business environment during the period, with many organisations holding back on new capital expenditure and investments, as the economic direction of the new government is being observed.

    He said the company is making a shift towards recurrent and subscription businesses which are more predictable, have increased margins and are less dependent on macroeconomic challenges, especially those arising from foreign exchange.

    He noted that the loss of N350 million recorded during the period reflected the continued difficulty of the Nigerian business environment in 2015 pointing out that with a significant segment of the company’s business dependent on international procurement, the difficulties of foreign exchange sourcing had a negative impact on the results.

    He added that the first half result was affected by the recognition of foreign exchange losses of N277 million and the write-off of N103 million, arising from the cancellation of a transaction duly recognized in fourth quarter of 2014. However, the company finished with a strong cash position of N1.3 billion at the end of the quarter.

    It should be recalled that the founder and Chief Executive Officer of Computer Warehouse Group, Mr. Austin Okere in a recent publication highlighted the yields from the company’s subscription business model which started in the second half of 2015 and the products being better positioned to withstand macroeconomic shocks.

    The products under the new business model include the CWG-SMERP, the cloud based Enterprise Resource Planning (ERP) product for SMEs, the award-winning Openshopen.ng which is an eCommerce technology platform, CWG-SES Teleport Services providing digital satellite broadcast, cloud solution for micro finance institutions in partnership with MTN  (dubbed MTN XaaS), CWG’s Mobile Financial Services in partnership with CIT Vericash, Finedge Solution, which has powered Diamond Yello Account (DYA), electricity theft detection & prevention systems, and CWG’s IGR Solution for States amongst others.

    While reviewing the H1 financial report, Mr. Okere reiterated that the company’s future looks promising as the products under her subscription business model are well positioned to soar above macroeconomic shocks, especially foreign exchange fluctuations that affect businesses generally.

     

  • Union Bank records modest growth in first half

    Union Bank of Nigeria (UBN) Plc, one of the oldest banks in Nigeria, rode on the back of significant growth in its core banking operations to mitigate headwinds and sustain overall steady but modest performance in the first half of this year.

    Key extracts of the interim report and accounts of UBN for the period ended June 30, 2015 indicated that interest income, which rose by 18.3 per cent, counterbalanced 11.2 per cent decline in non-interest income, leaving the top-line with a modest growth of 5.8 per cent. Pre and post tax profits rose marginally by 2.2 per cent and 1.9 per cent respectively.

    Group gross earnings closed first half 2015 at N55.96 billion as against N52.88 billion recorded in comparable period of 2014. Interest income had risen from N36.6 billion in 2014 to N43.3 billion in 2015. Net interest income however declined from N13.87 billion to N12.31 billion. Group profit before tax inched up from N6.47 billion to N6.61 billion while profit after tax slightly increased from N6.34 billion to N6.46 billion. Earnings per share rose from 35 kobo to 38 kobo.

    Managing director, Union Bank of Nigeria (UBN) Plc, Mr. Emeka Emuwa, said the successful implementation and migration to a new banking platform, Oracle FlexCube UBS, has provided a more stable operating environment for the bank to serve customers and process routine transactions quicker and more efficiently.

    “In spite of economic headwinds and regulatory changes impacting the financial industry, Union Bank remains on a stable growth trajectory as we implement initiatives to grow our core banking segments,” Emuwa said.

    He noted that the group’s core banking business performed significantly better during the period as the bank’s stand alone gross earnings grew by 17 per cent while the bank delivered profit before tax of N10.2 billion, a 53 per cent increase over the same period in 2014.

    “Excluding the gain on the sale of subsidiaries, the bank delivered profit before tax of N6.7 billion, a 134 per cent increase over the first half of 2014. Deposits also continue to move in the right direction with 8.0 per cent growth when compared to December 2014. Non-volatile deposits alone grew by N55.7 billion during the first half of 2015,” Emuwa stated.

    He assured that as more clarity emerges in the macro-economic environment in the second half, the group would consolidate the gains it made in the first half of the year; maintaining its focus on delivering operating efficiencies across its operations and proactively managing its risk while exploring emerging opportunities in the economy.

    In her remarks, chief financial officer, Union Bank of Nigeria (UBN) Plc, Mrs. Oyinkan Adewale, said good performance across most financial metrics underscored the improving fundamentals and operational discipline of the bank.

    “For the second half of 2015, our focus remains on continuing to manage funding costs, reducing operating expenses and minimising impairment costs through proactive risk management. We will also continue leveraging technology to enhance customer experience and reduce the cost of servicing customers,” Adewale added.