VITAFOAM IS ON A GOOD FOAM, SAYS INTERIM FIGURES

Vitafoam Nigeria plc appears to be lying comfortably on a good foam so far this financial year, if half year figures to March 2017 are anything to go by.

According to the figures released earlier this month, even though cost growth seemed out of proportion in the second quarter, by half year the company seemed set for a fine outing come year end September 2017.

At 31.2%, total income growth to N10640m was good enough although dragged down slightly from the 31.3% growth to N10567.4m by core income.

The interim cause for concern were the 42.4% increase in cost of sale to N7802.9m, that is well ahead of growth in core income it generated; 21.2% increase in finance income to N524.1m even though growth rate was behind income growth and the drag that resulted from only 20.2% rise in Other income to N73.1m since it did not match core income growth.

But Vitafoam had going for it the greater control it had over non direct cost resulting in 8.07% drop in administration expenses to N1623.4m and in distribution costs by 4.20% to N376.5m.

Both impacted very favourably on operating profit which rose by 78.2% to N837.6m compared to N470m previously.

In the end, because growth in finance cost at 21.2% was well below this operating profit increase, profit before tax ended the half year at N313.5m; that is multiples of the N37.7m reported at the same time in 2016.

This works out at N2.94 profit on each N100 income as against N0.47 clocked up to March 2016.

The only other cause form worry was that while less than 50% of the income flowed in the second quarter, above 50% of all costs were recorded in the second quarter implying that perhaps cost was growing while inflow was decreasing. Unless of course, it is a seasonal issue.

Given the more comfortable outing, Vitafoam closed the half year with reduced working capital deficit of N382.9m compared to N577.4m deficit at the same time in 2016.

VITAFOAM NIGERIA PLC:   HALF YEAR Nm
                                                                      2017                      2016
Total income                                                10640.05               8108.4
Core income                                                10567.4                 8047.6
Cost of sale                                                   7802.9                 5479.4
Gross profit                                                  2764.5                  2568.2
Other income                                                   73.1                      60.8
Administration cost                                      1623.4                  1766.0
Distribution expenses                                   376.5                     393.0
operating profit                                            837.6                      470.0
Finance cost                                                 524,1                      432.3
Profit before tax                                           313.5                       37.7
Profit margin %                                               2.94                        0.47
Working capital                                           (382.9)                 (577.4)

Comments

Post a Comment

Popular posts from this blog

2018: TWO BLOWS TO UNITED CAPITAL PLC.

When a child who in a previous examination scored 80%, comes home with a new report in which he now scores 67.2%, the parents have a right to sit him down and ask how come. So it must be between Nigeria's United Capital Plc and its discerning shareholders since the release of the company's 2018 audited figures. In 2018, all said and done, says the annual report, United Capital ended with 67.2 % profit margin compared to 80.2% in 2017. How come? What comes across from the figures was that the company received 2 blows to the jugular in 2018: Sharp drops in Investment income and fair value gain. Investment income dropped by 10.8% to N4422.8m from N4965.2m while fair value on financial assets plunged by 79.7% to N6.173m from 2017's N30.387m. In view of both drops, the group's gross earnings grew by only 33.9% to N9259.4m despite strong growths in net trading income, and net operating income leap to N757.5m from N143.5m  Other income streams ended with single digit increase....
Read more

KENYA AUCTIONS Ksh 13.84bn Treasury Bonds.

The Central Bank of Kenya (CBK) will from Tuesday December 18 to 27th 2018_ auction Ksh 13.84bn worth of fixed income Treasury Bonds with issue date December 17, 2018. According to official statement from the Director of Financial Markets Irene Njiru on Monday December 17, auction will continue throughout the stated period or close once the target money to be raised is reached, whichever comes first. Bid value will be paid for at most by 2pm December 31, 2018 while auction results will be made public on December 28, 2018 after the scheduled closing date. The bonds are being issued at 12.502% fixed interest at an adjusted average price of Ksh 100.468 for Ksh 100 bond. However, price payable after auction results publication will be average of successful bid prices based and allotment will be on first come first served basis. Meanwhile, the monetary operations and debt management department has released the interest payment schedule for 13 Treasury Bonds due January and February 2019. Th...
Read more

NAIROBI SE's HIGH PRICED EQUITIES.

In the wake of Nigeria's high priced quoted companies posted in this blog a while ago, Henates took a look to at Nairobi Securities Exchange June 23 official list to identify its high priced equities and the outcome was interesting too. Of the 66 companies quoted on the market by June 23, 15 or 22.7% were valued averagely at above 30 times nominal value. A word of caution though: There are two clear differences between the Nigerian stock market list and that of Nairobi: In the Nigerian one most listed companies have par or nominal value of N0.50 as is there is an implied agreement on this. On the other hand, at Nairobi most of the equities do not share common par value, they differ greatly. Then another thing, Nigerian equities are not valued below par, Nairobi ones can and many are so valued. Of the top 15 high priced equities at the Nairobi market, Safaricom topped with because by June 23, at 23.25 Ksh average price, it was valued 465 times its nominal value of just 0.0...
Read more