MAY & BAKER NIGERIA: ON TOP OF THE SITUATION.

May & Baker Nigeria PLC is apparently on top of the tough times in the Nigerian economy engendered by dropping crude oil prices. That is, if its half year figures to June 2015 are anything to go by.
According to the release to the Nigerian stock market recently, by June 2014 closed with a loss of about  N5.23 on every N100 sale recorded. However, by June this year, the tide turned in its favour. It ended June 2015 with N1.28 profit on each N100 sale.
First it grew its turnover by 10.7 per cent to 3,408.7m Naira and successfully held growth in cost heads to less than the turnover increase. Cost of sale increased by only 6.73 per cent to 2249.4m Naira from 2107.5m at the same time in 2014 while distribution and marketing costs grew by 8.04 per cent to 583.2m,
More significant though was the 7.06 per cent decrease in Administration expenses within the half year which highlights more the battle won over cost pressure so far. Less outside the company's control but with the same salutary effect on business, was the 8.02 per cent drop in finance costs from 309.2m Naira to 284.4m.
As a result, May & Baker ended the half year with a modest 43.7m Naira profit compared to 161.1m Naira loss by 2014 half year.
In sum:
* May & Baker had very good control over its costs  in the half year to June 2015 thus pointing to a possible brighter end for the year,
* However, the present recovery may not be strong enough  to result in dividend payment.



Comments

  1. Unknown29 September 2015 at 08:55

    This is good analysis. However, decision as to what stock to buy in nigeria is mostly based on the mood of investors on the market and the economy, rather than on fundamentals of any company. However, good investors base their investment decisions on fundamental, rather than sentiment. That is why we need such analysis. Thanks to henates.

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