NASCON ALLIED INDUSTRIES: UNCONTROLLABLE COSTS?

For Nascon Allied Industries PLC the nine months to September was dominated by controllable costs that could not be controlled.
At least given the times in today's Nigeria, growing total income by 24.6% to N10306.9m from N 8270.6m back in September 2014, deserved some broad smiles especially as revenue from main line actually increased by 24.8% to N10192.3m and income from other sources jumped by 67.2% to N114.2m.
Indeed, as far as income was concerned the drag came from the decrease in investment income to N0.42m as against N29.6m previously.
Unfortunately, while closing with such income growth, it recorded a higher 33.4% increase in cost of producing goods sold to N6954.4m from N5213.5m plus 43.8% increase in even more controllable administration costs to N884.7m from N616.3m.
Surprisingly, Nascon recorded 14% drop in finance costs to N11.1m and 9.99% decree in also less controllable distribution expenses from N85.1m to N76.6m.
All said and done, Nascon Industries ended September with 2.7% growth in profit before tax to N1616.4m from N1573.9m.
Because this was way behind total income growth, the gain on each N100 business stood at N15.7 as against N19 previously.
THUS:
* To close 2015 financial year on a higher note, Nascon Allied Industries may have to work seriously on its controllable costs.
* That is also hoping that decrease in finance cost stays real.

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