Computer Warehouse Group CWG Plc has revealed that the technology company suffered a decline in performance and its earnings may significantly drop than the previous years.
This hint was dropped by the board of directors of the company who noted that preliminary review of the annual report and accounts for the year ended December 31, 2017, revealed that estimated earnings and year-end financial targets “will be materially lower in comparison to prior year financials”.
The board noted that the reduction in earnings is as a result of losses incurred due to the financial cost implications of non-actualised projects which have adversely affected the company’s estimated earnings and year-end projections. It, however, allayed fears by investors and assured that its profit margin has continued to remain stable, despite the decline in earnings.
The company commenced operations in Nigeria, on September 26th, 1992 as Computer Warehouse Limited principally to cater for the hardware projects. In 1994. In February 2013, CWG Plc ceased to be a Private Limited Company and became a Public Company. Also, on the 15th of November 2013, CWG Plc listed its shares on the Nigerian Stock Exchange. The listing boosted the market Capitalization of the NSE by about ₦14 billion making CWG PLC the highest capitalized security in the ICT sector.
The stock price has been flat for a month and currently trades at ₦2.54 on the floor of the exchange.
It had reversed a pre-tax loss of ₦1.75 billion in 2015 to profit of ₦142 million in 2016. Highlights of the audited report and accounts of CWG Plc for the year ended December 31, 2016, showed the company witnessed considerable improvement in its underlying profitability.
Tech companies listed on the Nigerian Stock Exchange have in recent times performed poorly, with irregular dividend payments and poor price appreciation. Year to date, no Nigerian tech firm has witnessed price appreciation or outperformed the NSE All-Share Index which is up 11.49% year to date.
Nigerian tech firms, on the other hand, have largely struggled. Some such as Konga have had to merge with larger firms. Others such as Efritin and OLX have had to shut down and also Jumia could get a new owner soon as the major investor is preparing for an IPO for the online trading platform.