HENATES

Africa's largest Cement manufacturer. Dangote Cement PLC has been forced by imported and local cost push inflation to increase ex factory price by N600 and re-strategise on its energy supply. According to a release from management, Nigeria remains the African groups main market and sales volume continued to be robust in July and August. There has been some major challenges, though. These are disruption in gas supply in recent months; the continued depreciation of the Naira against the dollar and higher price for present alternatives to gas for powering its factories. The gas supply drop led Dangote Cement to resort to use of coal and LDFO which cost three times more. In addition, the drop in the value of the Naira also shot up cost of imported coal and other essentials Unable to absorb these pressures, Dangote  cement decided to renege on its promise given last September not to increase prices. Thus the N600 added brought the price to slightly higher than September levels. Ho...

Nine months into the year, it is now obvious that steel drum manufacturer, Greif Nigeria PLC will end financial year 2016 in the loss league. According to figures released for the period to July released this week, this was principally because it had to absorb 147.9% growth in foreign exchange related loss to N76.1m. In all, Greif ended the nine months with N16.5m loss before tax and this certainly was just a fraction of real increase of N36m in exchange loss. Agreed, there were pressures from other sources. For example. Cost of sale at N577.1m was up 20.9% thus ahead of 18.5% growth in core revenue to N693m it generated. To worsen matters, selling and marketing expenses rose by 30.2% to N3.58m and finance income decreased by 17.2% to N2.94m. The point though was that controlled administration costs would have helped to absorb these if the exchange loss had not more than doubled. In the end, because of the loss recorded and 155.2% leap in prepayments to N102.6m, Greif Niger...

That Nigeria is now in recession is no more open to debate. All the signs have manifested. Hence this is not the time to tactfully withhold monthly reports like composite price index in an attempt to blindfold any one on galloping inflation or reduce outcry against current political leaders. The time is more than ripe to stop calling on citizens and investors to bear the pains and also stay positive. Instead, the time now demands clear cut incentives to check the downswing by offering all and sundry what is in it for them if they act positive and remain Nigeria friendly. After all, no businessman is a philanthropist first before becoming a businessman. The reverse is the case, you make profit first, before you decide to spread the surplus around. Today's  task of getting Nigeria out of the woods comes in two twin packages: Get more foreign exchange to flow in while applying available forex more efficiently and Get the local economy to be more productive, efficient and innov...

Surely, in these times in Nigeria, making profit is akin to fighting a war but then, for Union Diagnostic & Clinical Services PLC, wars are won by winning one battle at a time. In the first half to June, Union Diagnostic's core revenue grew by only 5.07 % to N655m but it won a great battle when accompanying direct cost dropped by 1.73% to N288.9m thus topping gross profit by 11.2% to N366m. Then more square ups came from 48.4% increase in rent to N18.4m; 41.8% rise in transportation cost to N13.5m; 31.1% increase in repairs and maintenance bill to N19.4m and 19.3% spring in other operating expenses to N63.1m. All threatening to tear the 11% increase in gross profit apart. Well, it did not happen because 0.11% drop in staff expenses to N88.5m; 32.2% cut in professional fees  to N2.44m; 4.1% decrease in communication expenses to N2.57m and N2.27m bonus from finance income, absorbed the blows. Hence, even as finance charges increased by 10.5% to N3.36m, Union Diagnostic cr...

If there any time in Nigerian finance, it pays to be relatively small, the time is now and Unity Bank PLC is one of the banks that prove this in turbulent 2016. For Unity Bank the knocks of different policy somersault  since 2015 has been taking its pound of flesh but being rather small comparatively, one good news was enough to keep hope alive. So,  in the first half to June, gross earnings decreased significantly and many costs grudgingly followed from a distance but Unity Bank PLC still ended with profit, not loss. Gross earnings for the period had dropped by 35.1% to N21775.8m as interest income dived by 42.3% to N13477.4m; and fee and commission slumped by 82.7% to N804.2m. Stoking the fire some more was 32.7% drop in interest expense, well behind interest income decrease; 95.5% dive in paper income due to forex revaluation and less than proportionate decreases of 2.18% to N6942.2m and 24.4% to N5169.6m in personnel and other operating costs respectively. This recipe for...

C & I Leasing PLC is apparently making slow progress in the current year due to painful pressures. According to the half year results to June, C & I Leasing recorded impressive growths in most of its income streams but with accompanying cost growth in step or ahead. Lease income grew by 96.2% to N5493.1m but associated cost rose by 105.9% to N1305.8m and outsourcing income rose by 105.8% to N2713m but unfortunately, its related expenses closed 108.9% higher at N2476.4m. However, two exceptions to this trend were recorded although from streams that contribute far less to gross earnings. Tracking income rose by 89.1% to N76.2m tracked by only 20% rise in expenses to N51.7m and vehicle sales income increased by 84.2% to N98.2m accompanied by 38.7% rise in expenses to N113m thus reducing loss recorded in vehicle stream. The real game changer for C & I Leasing within the period was 176.4% growth in other operating income to N314.3m supported by 6.69% lift in interest i...

The one thing that was very cute and helpful for Cutix PLC in the financial year to April 2016 was its success in reducing administration expenses by 9.07% to N255.8m. According to the audited figures for the year, but for this it would have been impossible for Cutix to end the year with profit before tax 37.6% up at N278.5m. This had led to much improved 9.72% profit margin compared to 8.48% in 2015 year. Cutix PLC total income growth had settled at 20.1% to N2861.5m despite 20.2% rise in core revenue to N2835.9m. The slight scale down of income growth resulted from only 5.79% increase in income from other sources to N25.6m particularly as Cutix reaped 67.8% lift in forex related gains to N6.21m. The pressures absorbed by the administration cost decrease were 22.3% increase in cost of sale to N2102.5m; 29.4% rise in distribution expenses to N88.1m and 22.6% increase in finance cost to N137m especially as overdraft interest expense closed 86.8% up at N66.3m. In the new year...