CCNN Nets 152.94% Q2 Profit Growth, Despite soaring energy cost
Despite the N713.63m or 208.04% rise in income tax expenses and 85.08% jump in energy cost, the management of Cement Company of Northern Nigeria (CCNN), says net profit for the half-year ended June 30, 2018, rose by an equally robust N1.573bn or 152.94%.
According to the report presented to the Nigerian Stock Exchange (NSE), sales revenue for the period rose N3.573bn or 41.99% from N8.51bn in the corresponding period of 2017, to N12.084bn.
Cost of sales increased to N6.619bn from N5.483bn; leaving gross profit at N5.465bn, up from N3.027bn.
Other income for the period notched marginally to N17.92m from N15.8m, the bulk of which was the N8.029m insurance claims, up from N1.953m. Selling and distribution cost climbed from N458.008m to N557.123m, the lion’s share of which was distribution expenses and other overheads of N432.487m, which rose from N355.834m; followed by salaries, wages and benefits at N105.817m, up marginally from N90.677m, just as administrative expenses increased marginally from N1.134bn to N1.235bn.
According to management in the notes to the accounts, the major component of the cost of sales and administrative expenses for the period, energy cost, alone gulped N6.021bn for the period, representing a N2.768bn or 85.08% from N3.253bn in the preceding half year. Repair and maintenance cost dropped to N429.506m from N504.777m; and factory depreciation from N280.292m in 2017 to N298.189m.
Finance costs during the period fell to N354.771m from N78.584m, which was boosted by the N33.934m interest on loans, down from N63.888m; as well as the N20.837m bank charges, up from N14.695m in the prior half-year. This left profit before tax at N3.659bn; a significant rise from N1.372bn in 2017. Tax expenses climbed to N1.056bn from N343.021m; just as net profit was left at N2.602bn from N1.029bn, which translated to Earnings Per Share of 207 kobo, as against the previous 82 kobo
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