The Nation Newspaper

Tag: Profit

  • Leadway records N137.3b assets, reports 125% increase in profit

    Leadway Assurance Company has posted a 37 per cent growth in assets to the tune of N137.3 billion in its 2015 financial year results from N100.5 billion in 2014.

    A review of its results presented at its 44th Annual General Meeting showed that the company recorded 125 per cent growth in the company’s profit after tax to N6.3 billon from N2.8 billion in 2014.

    The company also paid claims in excess of N14.3 billion, a 13 per cent increase from the N 12.7 billion record of 2015.

    It, however, wrote a 20 per cent increase in gross premium from N39 billion in the prior year to N46.6 billion.

    With good performance on its investments, Leadway reported a record 125% growth in the company’s profit after tax to N6.3bn from N2.8bn in 2014.

    Speaking during the presentation of the results, the Acting Chairman, Mr. Jeremy Rowse, stated that with various guidelines aimed at reinforcing standards and encouraging confidence in the Nigerian insurance industry, the company remains poised to take advantage of emerging growth opportunities to compete effectively within its immediate market and the larger global markets.”

    He further stated that as the Nigerian polity itself becomes restructured to tackle the myriads of socio-political, economic and infrastructural challenges facing it, the opportunity for increase in insurance penetration and contribution to GDP should increase.

  • AIICO Insurance’s profit drops by 53.4%

    AIICO Insurance Plc has recorded a profit before tax of N1.4 billion in the financial year 2015 as against the N3.1 billion it recorded in 2014, down by N1. 6 billion or by 53.4 per cent.

    This was made known in the company’s 2015 full year audited financials posted on its website. The company held its 46th Annual General Meeting last week in Lagos.

    The company also witnessed a decline in its gross premium income as it records N9.94 billion in the year under review as against the N20.55 billion it recorded in 2014.

    The report showed that the book value of equity/shareholders’ funds was N9.4 billion, down by N2 billion or by 18 per cent in 2015.

    The report read: “This is largely as a result of a change in accounting policy – reclassifying ca. N60 billion of fixed income investments from a cost-based valuation to a market-based one thereby valuing at carrying values which are marked-to-market.

    “This was to eliminate the identified accounting mismatch and align the risks and management of the assets and liabilities for annuity.

    “Total assets as at December 31, 2015 is N80 billion, up by N22 billion, which grew significantly as the company reinvested policyholder’s funds and ensured adequate matching of assets to the duration of the liabilities, in particular guaranteed annuities, with estimated life expectancy of 20 years after retirement,” it stated.

  • Custodian makes N5.7b profit

    Custodian and Allied Insurance Plc has announced a Profit Before Tax increase of 11.8 per cent from N5.1 billion in 2014 financial to N5.7 in the 2015 financial year. The company would however pay a total dividend of 20 kobo per share in respect of the results of the year under review.

    In the same vein, the strength of the group was demonstrated in the structure of its assets which stood at N57 billion with cash, cash equivalents and financial assets component making up more than N38 billion, or approximately 66 per cent of the total assets.

    The underwriting firm’s gross revenue also increased by 19 per cent to N29.8 billion. Chairman, Custodian and Allied Plc, Chief Michael Ade Oio who made this known at the company’s 21st Annual General Meeting said despite the tumultuous business environment of 2015, it did not only survive but thrived respectably.

    He said: “The level of liquidity assures of our readiness to take advantage of whatever opportunities that may arise while, at the same time, provides the safety that our clients and shareholders require in this highly volatile environment.

    “Although there was a drop in interest rates at the end of last year which negatively affected the present value of our life insurance company’s future obligations in respect of its annuity portfolio, it is hoped that recovery will ensue when interest rates rebound and the need for the provision reverses.

    “The revaluation of the portfolio required further financial provision which otherwise would have boosted our results for the year.

    Speaking on dividend, he said that following the commendable performance of the company and as it is their practice to regularly pay dividend to their shareholders, a total dividend of 20 kobo per share in respect of the results of the 2015 financial year.

    He further noted that the national economic outlook for 2016 is challenging considering the low crude oil price, dwindling external reserve and apathy of foreign direct and portfolio investors to Nigeria.

    He urged the management to continue to exhibit the professionalism and ability to wax stronger in the face of adversity.

    He urged shareholders to encourage and support them by patronising the company’s services and recommend them to their associates.

  • Sterling Bank optimistic as core banking profit rises

    Sterling Bank optimistic as core banking profit rises

    Sterling Bank Plc rode on the back of improving internal efficiency to reduce funding costs and improve profitability of its core banking operations in the first quarter of 2016.

    Key extracts of the unaudited report and accounts of the Bank for the period ended last March 31, showed appreciable improvements in core underlying fundamentals, although macro-economic and industry headwinds subdued overall performance.

    The report indicated that net interest margin, which measures the profitability of a bank’s lending operations, improved to 8 per cent in the first quarter of 2016 as against 7.4 per cent recorded in the comparable period of 2015. The bank tightened grips on costs with cost of funds improving from 5.9 per cent in first quarter 2015 to 5.3 per cent in first quarter 2016.

    Major highlights showed steady performance with net interest income increasing by 24.7 per cent to N11.4 billion in 2016 as against N9.2 billion in 2015. This was driven by a 14.4 per cent decrease in interest expense resulting in a 940 basis points improvement in net interest margin to 56.9 per cent. However, profit before tax, on the face of it, declined by 30.6 per cent to N2.8 billion in 2016 as against N4.0 billion in 2015. But when adjusted for non-recurring items, which would have brought the 2015 figure to N2.7 billion, the 2016 figure represents a 3 per cent increase on fourth quarter 2015 and 2.4 per cent improvement over the same period last year. Also, while profit after tax declined by 35 per cent to N2.5 billion as against N3.9 billion in 2015, adjustment for non-recurring items would bring the 2015 first quarter figure to N2.6 billion. This depicts a marginal decline of 2.6 per cent.

    Outlining the bank’s outlook, Managing Director, Sterling Bank Plc, Mr. Yemi Adeola, said the bank adopted a cautious, but progressive approach to business due to the challenging macro-economic conditions.

    He noted that subdued crude oil prices, fuel and power supply disruptions, as well as significant foreign exchange shortages have persisted, increasing the cost of doing business and heightening the pressure on household income.

    He pointed out that as the nation’s inflation rate witnessed an uptick from 9.6 per cent in December 2015 to 12.8 per cent in March 2016, the resultant monetary tightening measures could further challenge the operating environment.

    With these, Adeola said the management of the bank prioritised balance sheet efficiency, cost efficiency and prudent credit risk management, which ensured that non-performing loan remained flat below the regulatory threshold of 5 per cent.

    “We are confident that our goals for 2016 will be met despite the subdued outlook for the Nigerian economy. Our optimism comes from the various investments focus on operating efficiency that the bank had made over the past year, which are now starting to pay off. Our plan for the year is to prioritise operating efficiency, ensure moderate loan growth, while continuing to diversify funding sources as our retail banking strategy matures,” Adeola said.

  • Fidson Healthcare grows net profit by 18% to N744m

    Fidson Healthcare grows net profit by 18% to N744m

    Fidson Healthcare Plc grew net profit by 18 per cent to N744.38 million in 2015 as the healthcare company braced through a depressed top-line to sustain a resilient bottom-line.

    Key extracts of the audited report and accounts of Fidson Healthcare for the year ended December 31, 2015 showed that profit after tax rose from N631.83 million in 2014 to N744.38 million in 2015. The board however took a cautious approach to dividend payout, reducing dividend per share from 15 kobo in 2014 to 5.0 kobo in 2015.

    The company will distribute 10 per cent of net profit as cash dividends for the 2015 business year as against about 36 per cent distributed for the 2014 business year. Shareholders will receive a total of N75 million as cash dividends for 2015 as against N225 million paid for the previous year.

    The report showed turnover of N8.21 billion in 2015 as against N9.72 billion in 2014. Profit before tax stood at N838.04 million in 2015 compared with N870.8 million in 2014. The company stated the decline in pre-tax profit was due to 29 per cent increase in finance cost from N554 million to N715 million due to the N2 billion fixed rate bond issued in November 2014.

    The management of the company attributed the decline in top-line to challenges to sales and distribution faced during the first half of 2015 largely due to the general elections.

    Directors of the company noted that the upturn in sales witnessed in the second half of the year was curtailed by the paucity of foreign exchange for the importation of products and essential raw materials, which severely affected product availability.

    The management pointed out that the six per cent increase in operating profit from N1.45 billion in 2014 to N1.52 billion in 2015 was due largely to the company’s cost optimization strategy and a reduction in selling and distribution expenses.

    The management said the cost improvement trend, which it embarked on a couple of years ago, is in line with its strategy to drive efficiency in the face of a challenging business environment.

    “The company continues its focus on extensive brand building as part of its long term strategy and will be introducing a number of new products into the Nigerian market. This is a direct result of the move to the company’s new World Health Organisation Good Manufacturing Practice (WHO-GMP), where local production is being ramped up. A new product line – Intravenous fluids – to be added to five existing product lines at the new factory will enable Fidson to consolidate its manufacturing base in the near future,” the management stated at the weekend.

  • Unilever Nigeria’s net profit drops by 50% to N1.2b

    Unilever Nigeria’s net profit drops by 50% to N1.2b

    Unilever Nigeria recorded mixed performance in  2015 as marginal top-line growth of 6.2 per cent depressed into a 50.6 per cent declined in net profit.

    Key extracts of the audited report and accounts of Unilever Nigeria for the year ended December 31, 2015 showed that turnover rose slightly from N55.75 billion in 2014 to N59.22 billion in 2015. Operating profit also inched up by 0.65 per cent from N4.61 billion to N4.64 billion. Profit before tax however dropped by 38.3 per cent while profit after tax halved to N1.19 billion in 2015 as against N2.41 billion in 2014. Earnings per share followed the trend, dropping from 64 kobo to 32 kobo.

    The board of the company has recommended payment of a dividend per share of 5.0 kobo.

    Commenting on the results, the company said trading conditions remained difficult throughout the year, but have continued to demonstrate resilience in tackling the growing drop in consumer’s purchasing pattern amidst other extraneous factors.

    Unilever Nigeria assured shareholders of continued efforts to ensure a sustained and steady growth in the company’s operations to achieve better returns on their investments.

    “Although the operating environment remains challenging, we have continued to see momentum behind process improvements, costs and operational efficiencies.  We will continue to focus on driving cost efficiencies, increasing market share across key categories and reinvesting behind our core brands,” the company stated.

    The management of the company said it had been addressing the issue of significant finance cost through a number of initiatives and the traction on these initiatives have started to impact on performance.

    Meanwhile, Exotix, a global research and investment firm, described Unilever Nigeria’s 2015 performance as poor, stating that the Unilever Nigeria’s performance fell within the “lower quartile of local consumer peer performance during the same period”.

    In a review of the 2015 earnings report, Exotix noted that while the company rebounded strongly in the fourth quarter of 2015, the last-quarter performance might not be sustainable  citing relatively challenging market conditions and concern that gains from recently-implemented initiatives  aimed at returning the company to growth are yet to consolidate.

    The review outlined that the factors that weighed on the company’s performance, outside the weaker economic backdrop which was broadly a headwind for peers, included higher input cost pressure following a devaluation in the naira, given the company’s relatively higher exposure to imported raw materials than local consumer peers; a surge in operating expenses owing to deliberate marketing and distribution efforts to expand its route to market; surge in interest expense; plant impairment charge and relatively greater effective corporate income tax.

    The report stated that Unilever Nigeria’s profit margins were lower across the board and remained relatively weak in comparison to local branded consumer company peers. Net margin was notably weaker at 2.0 per cent in 2015 as against 4.3 per cent in 2014 while earnings before interest and tax fell to 8.7 per cent in 2015 as against 9.1 per cent in 2014.

    The report, however, commended the decision of the board to pay a dividend per share of 5.0 , noting that while the payout and yield are much lower than consumer peers,  the decision to cut dividend per share was prudent.

    “We believe that “cash is king”, as in the current environment it provides a buffer in the event that the economy deteriorates further. To that extent, we observe a sharp improvement in the company’s net operating cash flow, quite consistent with that of local consumer peers. This accommodates a cut in the company’s gross debt at the end of 2015,” Exotix stated.

    Exotix placed a sell recommendation on Unilever Nigeria.

  • NB Plc profit drops by 10.5 per cent

    NB Plc profit drops by 10.5 per cent

    Nigerian Breweries Plc has declared 10.50 per cent drop in profit after tax for the financial year ended December. 31, 2015. It  posted a profit after tax of N38.06 billion against,  N42.52 billion achieved in the corresponding period of 2014. The report is contained in the company’s audited result released by the Nigerian Stock Exchange (NSE)  in Lagos, yesterday..

    Further breakdown of the company’s result indicated that profit before tax dipped by 11.30 per cent to N54.514 billion from N61.461 billion reported in 2014. Its turnover appreciated by 10.30 per cent to N293.91 billion compared with N266.37 billion achieved in 2014. Also, non-current liabilities dipped to N43.82 billion in contrast with N63.24 billion in 2014, while net assets increased to N172.321 billion from N171.964 billion in the previous year.

    The company’s total non-current assets grew to N302.91 billion from N296.51 billion, while total current liabilities grew to N140.08 billion from N114.03 recorded in the preceding year.

  • Honda Cars, India reports profit after six years

    Honda Cars, India reports profit after six years

    The last time Honda booked a profit was in 2007-08, when it recorded a net profit, according to the company’s filings with the Registrar of Companies.

    After being in loss for six years in a row, Honda cars India booked a profit in 2014-15, mainly on the back of a 61 per cent jump in revenues.

    In 2013-14, Honda had recorded a net loss.

    The growth for the Japanese car-maker came from improved sales with the company’s second manufacturing plant going on stream during the year as well as its foray in to the diesel segment in India. Honda cars booked a growth of 40.7 per cent in its volume of domestic sale of passenger vehicles, taking its market share to 7.26 per cent in 2014-15 from 5.36 per cent in the previous year. In the same period, the overall passenger vehicle industry saw a modest growth of 3.9 per cent over the previous year.

    The company enjoyed a market share of over four per cent in the passenger vehicle market in India at the end of the year 2007-08. However, with the higher demand arising in the following years for diesel cars, Honda’s market share fell sharply to around two per cent at the end of 2011-12.

    The year also witnessed Honda’s entry into the multi-purpose vehicle segment in India with the launch of its mid-size stylish seven-seater Honda Mobilio. The Honda City which was launched in January 2014 also received good demand with over 1,00,000 sales in the 15 months by the end of March 2015.

    “India emerged as the fourth largest market for Honda globally during 2014-15 and holds great potential for future growth as well,” the company’s directors report said.

    In 2014-15, Honda has further expanded its presence in the market with its re-launch of premium hatchback Jazz in July this year. The year is also expected to have the launches of the B-RV, a compact SUV based on an extended Brio platform as well as the new generation Civic and Accord.

  • Toyota records $10.35b profit in six months

    Toyota records $10.35b profit in six months

    With revenue up by nine per cent and net profit up by almost 12 per cent from a year ago, Toyota Motor Corporation appears stronger than ever and poised to ‘take advantage of Volkswagen’s slump by trying to win VW customers.’

    Toyota reported a half-year jump in profits last Thursday even as car sales declined in most regions, as it moves to cut costs and squeeze more productivity out of its plants worldwide.

    The world’s top automaker said its net profit rose nearly 12 per cent to 1.258 trillion yen ($10.34 billion) in the fiscal first half through September, with a weak yen also helping boost the bottom line. The company’s revenue for the period rose almost nine per cent from a year ago to 14.09 trillion yen ($115.78 billion).

    Toyota, however, sold slightly fewer cars globally at 4.98 million units, and trimmed its full fiscal year sales target.

    North America stood out as the one key region where demand was strong, after rivals Honda and Nissan also cited the giant market as a bright spot that helped offset a sluggish Japanese market.

    Japanese automakers have benefited from healthy growth seen in the U.S. market with low interest rates, although the Federal Reserve’s plans to raise rates, possibly next month could dent consumers’ appetite for new cars. Meanwhile, the weaker yen has made them relatively more competitive overseas and inflated the value of repatriated overseas profits.

    Sales have been sluggish in their home market, however, after a sales tax rise last year dented consumer spending and as younger urban residents delayed buying a vehicle.

    “The steady performance in North America is offsetting stagnant sales in emerging economies in Asia, especially Indonesia and Thailand,” said Yasuo Imanaka, analyst at Rakuten Securities. “The weak yen is also helping Toyota and other Japanese automakers generate profits.”

    Toyota is locked in a neck-and-neck race with crisis-hit Volkswagen to again claim the title of world’s biggest automaker — a crown it has held for several years. The Japanese firm took a slight lead in the first nine months of 2015, as its German rival battles a huge emissions cheating scandal.

  • May & Baker Nigeria grows Q3 profit by 165%

    May & Baker Nigeria Plc grew pre-tax profit by 165 per cent in the third quarter as the healthcare company continued to leverage on its recent investments in a multi-billion Naira world-class  pharmaceutical manufacturing complex.

    Key extracts of the nine-month report for the period ended September 30, 2015 showed that May and Baker Nigeria recorded significant improvement in profitability amidst steady growth in turnover during the period. Turnover rose by nine per cent while pre and post tax profits grew by 165 per cent and 144 per cent respectively.

    Turnover stood at N5.3 billion in third quarter 2015 compared with N4.8 billion in comparable period of 2014. Profit before tax stood at N60.63 million in 2015 as against a loss N93.5 million recorded in corresponding period of 2014. Gross profit had improved by 10.3 per cent to N1.8 billion as against N1.6 billion for the same period of 2014 while operating profit grew by 31 per cent from N360 million  to  N470 million. After taxes, net profit grew by 144 per cent from a loss of N93 million in third quarter 2014 to net profit of N41 million in third quarter 2015.

    Further analysis showed that selling costs followed the increase in revenue with a growth of 8.2 per cent while  distribution, sales and marketing expenses remained flat at N847 million. Administrative costs inched up by two per cent at N444 million. However, the company reined in finance charges, reducing these by 8.7 per cent from N466 million in third quarter 2014 to N425 million in third quarter 2015.

    It should be recalled that May & Baker had raised her capacity to produce more products with the construction of the world class pharmaceutical centre known as the PharmaCentre located in Ota, Ogun State. The facility has raised May & Baker’s production capacity by over 60 per cent.

    The Pharma Centre  is a mega investment in the pharmaceutical sector targeted at making Nigeria one of the leading producers of quality medicines in the world. It is one of the few Nigerian pharmaceutical facilities that were recently certified by the World Health Organisation (WHO) on Good Manufacturing Practice (GMP). The PharmaCentre is currently undergoing the process of WHO pre-qualification for its specific products.

    In a recent interview with The Nation, managing director, May & Baker Nigeria Plc, Mr. Nnamdi Okafor, said the company will consolidate its performance in the years ahead.

    According to him, with the completion and stability of the new factory, which is now running well, management’s focus has shifted to how to optimise the potential of the new factory to generate returns for shareholders.

    “Just on its own, we are going to get a lot of returns from that facility going forward because the output is getting better, the efficiency of the processes is improving, and with that we believe the products should be coming out at a lower cost unit as we do more volumes and our margins will also get better. But beyond that, we have taken a look at our products portfolio and we are repositioning the company in a way that we put emphasis on those products that are not what everybody is doing in the market. Those products surely will give us better returns,” Okafor said.

    He said The Pharma-Centre as a centre of excellence would soon begin to do specialized products that will have better margins and will lead to higher profits for the company.

    He noted that with the WHO certification, the company has been getting a lot of enquiries from multinational companies abroad which want to manufacture on contract basis from that facility, and some Nigerian companies that want quality products; wanting to do their products from the Pharma-Centre.