NINE MONTHS RESULTS (1):GUINNESS: CRITICAL PRESSURES , INTERLINKED'S HURDLES.

GUINNESS: CRITICAL PRESSURES.

According to the unaudited nine months figures released recently, Guineas Nigeria PLC may end year 2016 considerably weaker because of critical pressures.
All round, the figures tell the tale of sliding fortunes with Guinness just managing to hold on to N1.7 gain on each N100 income by March 2016 compared to N8.3 a year ago.
They also tell of faster slide in fortune from N3.27 gain on each N100 income by half year to December 2015.
From the results, the things worth cheering within the period are linked to finance because finance income increased by 40.1% to N946.6m and finance cost dropped by 19.2% to N3346.3m.
It was the finance income growth that reduced total income decrease to 17.5% at N70912m despite 17.9% drop in core revenue to N69619m and 38.2% decrease in Other income to N346.4m.
The situation worsened for Guinness because cost of sale drop at 12.6% to N39352.5m did not match revenue decrease; and worse still more controllable expenses reduced in single digits.
Marketing and distribution cost decreased by only 9.44% to N18338.4m while administration expenses came to N8670.6m, down 8.2%.
Consequently, Guinness Nigeria ended March 2016 with 83.4% decline in profit before tax to N1204.3m from N7134.1m previously.
Also, the company's liquidity pressure increased within the period as working capital deficit rose to N13433.7m from N12588.3m amidst 81.1% jump in loans and borrowings to N12616.5m.

GUINNESS NIGERIA: (Nm)
                   9 months March.
                   2016.              2015
Total inc. 70912.0.         85986.2
Core inc.  69619.0.         84750.1
Direct cost 39352.5.      45014.7
Other Inc.      346.4.           560.2
Marketing  18338.4.       20250.1
Admin.         8670.6.         9445.0
Finance inc.  946.6.            675.9
Finance cost 3346.3.       4142.2
Profit b4 tax  1204.3.       7134.1
Profit margin % 1.70.           8.30
Working cap. (13433.7) (12588.3)
Overdraft.        5946.0.       1471.8
Loans.            12616.5.      6967.6

INTERLINKED TECHNOLOGY: HURDLES TO SCALE.

If Interlinked Technology PLC is to end the current year to June 2016 in flying colours then it must scale some hurdles on its way. Or so indicate the nine months figures to March released recently.
The hurdles are in the form of 27.6% rise in finance cost to N2.5m, 1.67% increase in administration cost to N24.3m and only 13.8% drop in distribution cost in the face of 15.6% decrease in revenue to N101.7m from N120.5m.
Combined, they watered down the impact of direct cost going down by 20.8% to N71.3m, that is, ahead of revenue drop.
This was why profit before tax dropped by 27.6% to N1.81m thus depressing profit margin to 1.78% from 2.08%.
Interlinked Technology took good charge of its liquidity position though ending the period with improved N252.2m working capital despite increasing fixed assets value by 10.3% to N7.16m; despite reducing short term borrowings by 32.5% to N6.54m and payables by  18.7% to N72.6m.

INTERLINKED TECHNOLOGY (Nm)
                    9 months March
                              16.            15
Revenue.              101.7.       120.5
Cost of sale.          71.3.         90.0
Distribution.            1.81.         2.1
Administration.      24.3.        23.9
Finance cost.          2.50.        1.96
Profit before tax.    1.81.         2.50
Working capital.   252.2.      241.7
Short term loan      6.54.        9.69
Fixed assets.         7.16.         6.49
Trade payables    72.6.          89.3

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