May & Baker Nigeria Plc grew on improved cost management and increased margins to sustain impressive growth in profitability in the third quarter as total comprehensive profit grew by 240.65 per cent to N744.33 million.
The nine-month report for the period ended September 30, 2018 submitted at the Nigerian Stock Exchange (NSE) showed that May & Baker Nigeria continued to witness impressive growth in its core Pharma-healthcare business, with stronger margins, despite slight decline in revenue and present macro-economic challenges.
Gross profit rose by 10.6 per cent from N2.156 billion in third quarter 2017 to N2.385 billion in third quarter 2018. Operating profit also increased by 15.83 per cent from N770.71 million to N892.75 million. With finance cost dropping by 37.25 per cent from N479.60 million in third quarter 2017 to N300.94 million in third quarter 2018, profit before tax jumped by 89.19 per cent to N609.94 million as against N322.39 million recorded in comparable period of 2017.
Turnover dropped marginally by 5.63 per cent from N6.93 billion to N6.54 billion. The company had during the period divested and sold its noodles business as part of its strategic focus on its core healthcare business.
Earnings per share, based on continuing operations, increased by 89.78 per cent from 22.30 kobo in 2017 to 42.32 kobo in 2018. On the basis of total net comprehensive income, earnings per share jumped by 240.58 per cent to 75.95 kobo in third quarter 2018 as against 22.30 kobo in third quarter 2017.
May & Baker Nigeria is raising N2.45 billion in new equity funds through a rights issue to existing shareholders. The company is offering 980 million ordinary shares of 50 kobo each at N2.50 per share to existing shareholders.
Managing director, May & Baker Nigeria, Mr. Nnamdi Okafor, said the third quarter performance showed that the company’s strategic focus and investments have continued to yield gains for the shareholders.
He said the ongoing rights issue would further help to reduce finance costs, increase capacity and bring greater returns to shareholders, urging shareholders to pick up their rights in order to realise the benefits of their patience and supports for the company over the investment years.
Okafor said while the company is making local inroads, it has also signed a marketing agreements with a foreign companies to market herb-based medicines key to African disease profile, with some of these products already doing well in the market and also extracting commitment from the company to transfer technology after a number of years.