SLOW & STEADY FOR NIGERIAN ENAMELWARE PLC.

Slow and steady, they say, wins the race. In today's trying times in Nigeria, this rings very true for Nigerian Enamelware PLC.

In the full year to April 2015, Nigerian Enamelware had ended with 4.57% profit margin. In the next three months after that, it pushed it up to 6.03%.

That way, it ended the full year to April 2016 with 5.96%. Yes, down slightly on its first quarter but clearly ahead of the 2015 full year.

Now, according to figures released for the first quarter to July 2016, profit margin has been upped to 6.08% like a man gently climbing a tough height.

Thus, all things being equal, the full year to April 2017 should end with margin not lower than year 2016's.

The key seems to belong more to its continued ability to stay atop of its administration costs while leaning on reliable income from other sources.

True, because of the times, cost of sales has a way of caging core revenue growth impact by growing ahead but slightly, not by a wide margin.

In the quarter to July 2016, core revenue grew by 8.22% to N719.8m while cost of sale rose by 9.21% to N608.5m.

The counter pressure was offered by 37.5% increase in other income to N29.7m as,  happily, administration cost went down by 13.3% to N44.4m.

So much so that, Nigerian Enamelware ended with 10.1% increase in profit before tax to N45.6m from 9.15% rise in total income to N749.5m and in spite of only 3.06% increase in gross profit.

This was in spite of 38.2% top up of finance cost to N51m within the quarter.

Naturally, slow and steady has been having impact on the company's liquidity position.

By 2015 financial year, working capital closed at N561.2m. This came to N667.6m by July 2015 then closed full year to April 2016 at N696.8m before ending the new first quarter at N731.1m.

NIGERIAN ENAMELWARE: Nm
                    First quarter
                          2016.          2015
Total income  749.5.          686.7
Core revenue. 719.8.          665.1
Cost of sale.   608.5.          557.2
Gross profit.   111.2.          107.9
Other income  29.7.             21.6
Administration 44.4.           51.2
Finance cost.    51.0.          36.9
Profit before tax 45.6.         41.4
Profit margin %  6.08.         6.03
Working capital 731.1.      667.6

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