LA FARGE AFRICA PLC: NEW STREAM OF INCOME?

Shareholders if LA Farge Africa PLC may well watch out for one item in the company's annual report for this year: Long term receivables. What is it? How was it built up?
These are some of the questions they may have source answers because it looks the item is becoming LA Farge's new focus or even life line.
According to the figures for nine months to September released last week, main line business is growing sluggishly yet direct and indirect costs are growing faster but the net effect of these is being cushioned by returns from strategic attention to long term receivables.
For example, other operating income rose handsomely to N1790.8m compared to only N544.6m previously while turnover from cement making and selling increased by only 5.4% to N168144.8m from N159396.1m.
On the other hand, increase in direct cost was ahead of this at 9.33% to N113749.4m from N1040367m and administration overhead went up by 16.4% to N18507.3m.
In the end, LA farce Profit before tax (PBT) dropped by only 11.9% despite the higher growth in expenses. Net financial charges was less weighty though.
Within the period cash continued to roll in for LA farce from main business and aside from beefing up inventories by 10.1%; trade receivables by 34.7% as cash dropped by 11.3%; long term receivables increased by 58.8% to N10209m from N6248m earlier same September in 2914.
SO:
* LA farce Africa will do well to watch closely its liquidity position as it joggles cash for non main line income because it's working capital deficit increased by 22.6 per cent.
* 2015 will still end fairly well but this is hoping that the pick up for cement market expected cones to pass.

Comments

Post a Comment

Popular posts from this blog

2018: TWO BLOWS TO UNITED CAPITAL PLC.

When a child who in a previous examination scored 80%, comes home with a new report in which he now scores 67.2%, the parents have a right to sit him down and ask how come. So it must be between Nigeria's United Capital Plc and its discerning shareholders since the release of the company's 2018 audited figures. In 2018, all said and done, says the annual report, United Capital ended with 67.2 % profit margin compared to 80.2% in 2017. How come? What comes across from the figures was that the company received 2 blows to the jugular in 2018: Sharp drops in Investment income and fair value gain. Investment income dropped by 10.8% to N4422.8m from N4965.2m while fair value on financial assets plunged by 79.7% to N6.173m from 2017's N30.387m. In view of both drops, the group's gross earnings grew by only 33.9% to N9259.4m despite strong growths in net trading income, and net operating income leap to N757.5m from N143.5m  Other income streams ended with single digit increase....
Read more

KENYA AUCTIONS Ksh 13.84bn Treasury Bonds.

The Central Bank of Kenya (CBK) will from Tuesday December 18 to 27th 2018_ auction Ksh 13.84bn worth of fixed income Treasury Bonds with issue date December 17, 2018. According to official statement from the Director of Financial Markets Irene Njiru on Monday December 17, auction will continue throughout the stated period or close once the target money to be raised is reached, whichever comes first. Bid value will be paid for at most by 2pm December 31, 2018 while auction results will be made public on December 28, 2018 after the scheduled closing date. The bonds are being issued at 12.502% fixed interest at an adjusted average price of Ksh 100.468 for Ksh 100 bond. However, price payable after auction results publication will be average of successful bid prices based and allotment will be on first come first served basis. Meanwhile, the monetary operations and debt management department has released the interest payment schedule for 13 Treasury Bonds due January and February 2019. Th...
Read more

NAIROBI SE's HIGH PRICED EQUITIES.

In the wake of Nigeria's high priced quoted companies posted in this blog a while ago, Henates took a look to at Nairobi Securities Exchange June 23 official list to identify its high priced equities and the outcome was interesting too. Of the 66 companies quoted on the market by June 23, 15 or 22.7% were valued averagely at above 30 times nominal value. A word of caution though: There are two clear differences between the Nigerian stock market list and that of Nairobi: In the Nigerian one most listed companies have par or nominal value of N0.50 as is there is an implied agreement on this. On the other hand, at Nairobi most of the equities do not share common par value, they differ greatly. Then another thing, Nigerian equities are not valued below par, Nairobi ones can and many are so valued. Of the top 15 high priced equities at the Nairobi market, Safaricom topped with because by June 23, at 23.25 Ksh average price, it was valued 465 times its nominal value of just 0.0...
Read more