AVON CROWN CAPS STILL UNDER PRESSURE.

Avon Crown Caps Group Nigeria PLC seems headed for yet another year of loss because it remains under pressure.

According to figures for the first quarter to June 2016 released last week, not much has changed since the N153.8m loss reported in the year to March.

Sure there was 19.6% increase in the core income for the quarter to N4078m, but this was neutralised by 32.4% rise in cost of sale to N3686.6m.

Sure too 27.6% decrease in financial charges to N234.4m and more manageable 5.6% increase in overhead to N337.7m was recorded, a further 17.3% drop in income from other sources to N3.72m did not help matters.

Hence, the group ended the quarter with N177.1m loss compared to only N12.5m loss by the same time previously.

Besides, this time around, it looks like subsidiaries are in no position to help cushion the downswing in main company's fortunes.

By the first quarter of last financial year, the company had reported N41m loss which was reduced by subsidiary input for only N12.5m by the group.

This time, the company's loss for the quarter came to N71.7m thus implying that subsidiary helped depressed it to N177.1m loss.

Naturally, as a result of the loss, Avon Crown Caps is battling with liquidity issues as working capital deficit widened to N2536m from N2397.6m by close of last financial year and N1038.1m by previous first quarter.

AVON CROWN CAPS: Nm
                 First quarter
                     2016.      2015
Total rev.    4081.7.  3415.4
Core rev.     4078.0.  3410.9
Cost of sale 3686.6  2784.2
Overhead.      337.7.  319.8
Other inc.         3.72.     4.5
Fin charges  234.4.   323.9
Profit b4 tax (177.1) (12.5)
W. Capital.  (2536)  (1038)

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