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Business News

Vitafoam’s Half-Year results temporarily pushed stock to a 3-year high

Vitafoam Nigeria Plc’s share price attained a 3-year high on Wednesday, thanks to the significantly-positive half-year 2019 results posted by the mattress-maker.

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Vitafoam Nigeria Plc, Dividends and bonus shares, Subsidiaries

Vitafoam Nigeria Plc‘s share price attained a 3-year high on Wednesday, thanks to the significantly-positive half-year 2019 results posted by the mattress-maker.

The result, alongside future growth potentials, attracted investors to the company’s stock which gained 9.82% after trading 848,540 units of shares and closing at N4.25.

Performance Details Explained: The gain implies that Vitafoam shareholders had their stake increase by N725 million year-to-date to a market capitalisation of N5.316 billion.

The demand for Vitafoam‘s shares further pushed up the NSE All Share Index, which has been performing positively in recent days, thanks to the bullish run of newly-listed MTN Nigeria Communications Plc.

But the stock’s rise seems to have only been temporary because as of Thursday, May 23rd, Vitafoam traded only 264,460 units of shares. The share price, however, remains N4.25.

Vitafoam’s Half-Year 2019 Results: The result reveals that Profit After Tax leaped by 150% to N774.7 million, up from N309.7 million recorded in HY 2018.

Income from the company’s local market, during the period, rose by 21% to N12.66 billion from N10.50 billion in 2018. Similarly, revenue from the market outside Nigeria surged by 29% to N272.6 million from N210.9 recorded in 2018. This represents a 20.7% rise in overall revenue for the period under review.

Increase in other income recorded by about 129% to N151.7 million further impacted the company’s profit. This comprised gains from asset sales, investment, sales of scrap, rentals unclaimed dividends and exchange gains.

The shareholders should be impressed: For the company’s shareholders, the result is rather commendable when compared to previous performances. It should be noted that the company had been made consecutive losses in the past three years. It posted losses after tax of N71.9 million, N32 million, and N127 million in 2015, 2016 and 2017 respectively.

Nevertheless, the performance for the 9 months ended June 2018 placed the company on the path of recovery. Its PAT stood at N515 million in 2018 compared to N133 million in 2017, which reflected in the current result.

Company’s Expansion Plans: Vitafoam had introduced eight new products into the market at the beginning of 2019. The new products would help enlarge the firm’s revenue base enhance customer’s healthy living and boost shareholder value, management said.

Vita Pearl, one of the latest offering, is a pillow that regulates temperature and moisturises the body. Others include assorted customised beds, sofas, Trifold mat for leisure, reading chairs, three specialised mattresses including orthopedic and classic and various polyurethane sandwich panel steels.

Vitafoam has committed more fund to advertising in a move to attract more customers. Advertising spending rose by 86% from N64.6 million in half-year 2018 to N121.2 million in half year 2019.

Yet, it should be noted that competition remains stiff. Therefore, the company should be on its toes if it intends to ensure continued growth.

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Ronald Adamolekun is a creative writer with proficiency in journalism, financial reporting, financial analysis and imaginative writing. However, his core competency lies in fiction and short story writing as well as feature writing. He is a graduate of English and Literature from Covenant University, Ota, Nigeria.

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Real Estate

FG to unveil dedicated portal for sale of houses to Nigerians

The Federal Government has announced plans to launch a dedicated web portal for the sale of buildings to Nigerians in the next few weeks.

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Nigeria needs N1.5 trillion within the next 3 years to fix roads - Fashola

The Federal Government has announced plans to launch a dedicated web portal for the sale of buildings to Nigerians in the next few weeks.

The platform is expected to help contributors to the National Housing Fund (NHF) access mortgage loans on a first-come, first-serve basis.

This disclosure was made by the Minister of Works and Housing, Babatunde Raji Fashola while speaking at the ninth meeting of the National Council on Lands, Housing and Urban Development in Jos, Plateau State.

Fashola, who was represented by the Minister of State for Works and Housing, Abubakar Aliyu, pointed out that the ministry is currently at the completion stages of the first phase of the national housing programme in 34 states of the federation, which provided land for it.

He said, “We urge the state governments to alert their residents to this opportunity for interested persons to apply.”

Fashola commended the Federal Mortgage Bank of Nigeria (FMBN) for being at the forefront of the cooperative housing initiative at the federal level, adding that it has the advantage of allowing cooperative members to choose what they design and build to fit their budgets.

They can leverage their members to get group discount for the purchase of building materials as well as the engagement of contractors.

Fashola disclosed that FMBN as the driver of the housing initiative has engaged 86 co-operatives in projects; approved N35, 784 billion cumulatively; disbursed N10.95 billion; and processed as at January, 57 co-operative housing development loans.

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Fashola emphasized that what the Federal Government can do directly in housing is limited compared to what states can do, just as state governments are also limited, compared to what the private sector and individuals can do.

He said, “The majority of houses available for sale or rent belong to individuals and private companies compared to what states or Federal Government has available. Therefore, many of the tenants who owe rent, who face eviction or who seek to rent or buy property are dealing with private citizens or companies and less so with government agencies.’

My recommendation for improving access and affordability to housing in the Covid-19 era is for private companies and individuals to give back some of what they control to citizens in the way the Federal Government has given back to citizens some of what it controls.’’

He explained, “for example in cases where the rent of businesses or individuals are due for renewal, the private landlords can give back, by accepting monthly, quarterly or half-yearly rent instead of one year, two or three years rent in advance.”

Bottom line

Nigeria has been bedevilled by a housing crisis that has left Africa’s most populous nation ill-equipped to properly provide accommodation for its citizens and inhabitants.

Some of the housing problems in the country include unresolved rent tenure arrangements, high cost of building materials, access to infrastructure, deficiency of housing finance arrangements, stringent loan conditions from mortgage banks, time to process legal documents and inadequate government housing policies.

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Coronavirus

Covid-19: Nigeria committed to procuring 29 million J&J vaccines

The Nigerian Government is still committed to acquiring 29.59 million doses of Johnson & Johnson covid-19 vaccines through the Afrixem Bank AVAT initiative. 

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AstraZeneca suspends COVID-19 vaccine final stage trial over safety concerns, COVID-19: J&J starts vaccine trials on humans after success on monkeys

The Nigerian Government says it is still committed to acquiring 29.59 million doses of Johnson & Johnson covid-19 vaccines through the Afrixem Bank AVAT initiative.

This was disclosed Mrs Zainab Ahmed, Minister of Finance at the recent ‘Collaborative Africa Budget Reform Initiative (CABRI) General Assembly webinar.

What the Minister said

“Therefore, the supplementary budget for COVID-19 vaccines will cover the cost of additional vaccines over and above those provided by COVAX, as well as the full cost of operations and logistics for delivering the vaccines around the country.

Already, the sum of N29.1 billion has been released from the Routine Immunization budgetary provision (Service Wide Vote) to the National Primary Healthcare Development Agency (NPHCDA) as an advance for the operational cost of deployment of the COVID-19 vaccines. The N29.1 billion represents about 52 percent of the amount required over 2021-22,” she said.

She added that FG plans to vaccinate 70 percent of eligible (18 years and above) Nigerians over the 2021 and 2022 fiscal years, with the COVAX agreement willing to cover 43.1 million of the eligible population.

In case you missed it

The World Health Organization (WHO)  announced the approval of China’s Sinopharm vaccine for Covid-19 vaccination. The vaccine is reported to have 79% efficacy against covid.

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