NASCON Allied’s full year profit hits 5-year high
by BALA AUGIE
March 14, 2018 | 2:16 am| | | Start Conversation
Nascon Allied and Industries Plc’s full year profit has hit a five year high as the company continues to use the resources of shareholders in generating higher profit.
The 2017 audited financial statement of the Nigerian consumer good giant shows net income was N5.34 billion, which represents a 121.57 percent surge from 2016 figure of N2.41 billion.
This year’s net income nearly doubles N2.69 billion recorded in 2013.
Analysis of the chart shows profit dropped by 44.62 percent to N1.86 billion in 2014 from the 2013 figure while the bottom line grew at a slow pace to 2016.
The precipitous drop in earnings to 2014 from 2013 and the slow growth till 2016 were due to the sudden drop in oil price and a severe dollar shortage that hindered manufacturers from importing raw materials and equipment to meet production.
2016 was a horrendous year for fast moving consumer goods firm as the foreign exchange scarcity resulted in imported inflation while cost of raw materials soared hence eroding margins.
Nigeria slipped into its first recession in 25 years after two consecutive economic contractions in 2016 while consumer wallets were pressured.
The introduction of a flexible exchange rate by the central bank in April 2017 increased the flow of direct investment into the country, paving the way for consumer goods firms’ access to foreign currency to import raw materials and obligations to creditors.
The country’s GDP expanded for three straight quarters last year after a 1.6 percent contraction in 2016, with year-on-year growth reaching 1.9 percent in the final three months of 2017, thanks to a rebound in oil production.
An improving economy has trickled down to the numbers of NASCON Allied. In fact, data from its 2017 audited financial statement shows net profit margins increased by 4,365 basis point to 19.74 percent in December 2017 from 13.74 percent the previous year, the highest in three years.
The Nigerian consumer goods giant’s sales hit N27.06 billion in the period under review, the highest in five years, since BusinessDay started gathering data.
NASCON Allied and Industries recorded a 47.94 percent year on year growth in revenues, thanks to contributions from the salt segment.
NASCON Allied Industries PLC provides food products. The Company products salt, vegetable oil, tomato paste, and seasoning products. NASCON Allied Industries serves customers in Nigeria.
The company’s share price has gained 24.32 percent since the start of the year, valuing it at N60.93 billion.
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