JULIUS BERGER: MORE CASH, LESS PROFIT.

Time was when construction giant, Julius Berger PLC groaned under the weight of outstanding monies due from customers for work already done, now it looks like the table turned in the company's favour at least in 2015 financial year.
Or so indicates the audited reports for the year released recently to the stock market. However, the tide did not turn in favour profit recorded.
By 2015 close Julius Berger had in its kitty N106971.4m  as amount due to customers on contracts, up 14.2% on 2014's N93690.3m.
This came in very handy not only in helping Julius Berger reduce short term borrowings by 28.7% to N24807.9m from N34809.1m but more importantly it helped ensure closing working capital of N48049.5m compared to only N18002.1m in 2014.
It probably also helped too to keep growth in cost of funds to 2.8% from N5981.5m to N6148.8m.
In spite of this though, Julius Berger still had a rough year because its core and total revenue dropped by 32% and 32.6% respectively with total revenue closing at N134642.8m from N198786.4m previously.
The higher percentage decrease in total income was in spite of heart warming gain from other sources at N695.4m compared to N170.4m loss in 2014 and as investment income dived by 65.5% to N139.8m from N405.8m.
In the final analysis, Julius Berger reported 50.5% decline in profit before tax to N6500m from N13134.9m as only marketing cost decreased ahead of revenue drop while administration cost reduced by 31.9%; close but not ahead.
This meant profit margin closed the year at 4.83% as against 6.57% previously.
SO:
* It is hoped something more concrete will be done to administration costs especially of the company that actually ended 2015 20.4% up.
* Hey, can a drop in finance cost be possible in 2016?

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