Courteville Business Solutions released its 9months earnings results showing an 18% increase in revenue to N914million compared to N775million same period last year. Gross Profit also rose 16% to N442million compared to N379million same period last year. Operating profit also rose 47% YoY to N164million. Pre-tax profits at the end of the period was N313million (2012 9months: N281million).
- Despite the increase in revenues Gross Profits remained pretty much flat as cost of sales rose
- Operating profit margin does show a 25% increase which actually didn’t have much to do with any significant improvement in efficiency.
- Debt to equity reduced considerably as the company repaid its short term debts.
- Return on Equity for the 9month period was 9.3% compared to 8.4% the year before and about the same figure at the end of the financial year 2012.
- Cash flow from operations was negative this period as the company paid dividends of abut N128million. It also spent about N192million in investments as it acquired new assets including N34million in intangible assets.
- The third quarter saw a drop in revenues to N288million.
- Gross Profit margin was lowest this quarter just as the company lost money on operational profit. Operational expense was very high this quarter compared to the prior quarters.
- The silver lining in the third quarter was income from other income which just about helped the company post a profit for the quarter.
- It will be interesting to get an idea of why the company had a tough third quarter and where income from other sources was.
- The haphazard nature of income from other sources makes it somewhat unreliable for projections without a clear idea of its make up.
This result is an improvement year on year as well. However, no significant value was created for shareholders in the short run. The reduction in debt was, particularly current liabilities have been paid off.
Courteville released its 9months 2013 results in the website of the NSE
NOTE: This article was updated October 19 2013 to correct the third quarter extrapolation that was erroneously calculated in the original post. This therefore required that we change our analysis. Thanks to our readers for pointing out the error. [/upme_private]