Cutix Plc has projected that in the fourth quarter of its financial year 2021, its revenue will double and profit will increase by 9% to N148 million.

These projections were made by the company in a recent earnings forecast issued by the Management, and signed by the Company’s CEO and CFO.

READ: Vitafoam shares gain 9.6%, as company reports N4.11 billion as profit in 2020

Key highlights of the earnings forecast for Q4 ended April 30, 2021

• Revenue to increase to N1.66billion, 100% Q-o-Q.
• Cost of Sales to increase to N1.16 billion, 70% Q-o-Q.
• Distribution, Admin & Other expenses to increase to N232.89 million, 14%% Q-o-Q.
• Other Income to remain unchanged at N2.50 million,
• Finance Charges to increase slightly to N47.38 million, 3% Q-o-Q.
• Operating income to increase to N227.83 million, 14% Q-o-Q.
• Taxation is projected at N79.74 million.
• While Profit attributable shareholders is projected at N148.10 million.

READ: Royal Exchange Plc forecasts N500.83 million PAT in Q1 2021

Bottom line

The earnings forecast was made on the ground that the Nigerian economy will continue improve, as the country recovers from the impact of COVID-19. In this regard, revenue in the fourth quarter of 2021 will be slightly higher than the revenue projected in the third quarter of 2021.

READ: Okomu Oil Plc records 27.01% decline in 2020 Q3 revenues

However, the increase in the cost of sales driven by the input cost will pressure profitability to the tune of N148.10 million, which is 9% higher than the profit after tax made in the corresponding quarter of 2020.

Vitafoam Nigeria Plc has reported in its audited financial statement for 2020 that it made a profit of N4.11billion for the year ended 30 September 2020.

This represents a 72.10% increase in profit when compared with the N2.39billion profit reported in the corresponding period of 2019.

READ: Vitafoam returns to a 5-year high

Key highlights

• Revenue increased to N23.44 billion in 2020, 5.21% Y-O-Y.
• Cost of Sales decreased to N12.43 billion in 2020, 8.06% Y-O-Y.
• Gross Profit increased to N11.01 billion in 2020, 25.68% Y-O-Y.
• Other income increased to N638.97 million in 2020, 63.91% Y-O-Y.
• Distribution costs increased to N1.05 billion in 2020, 8.13% Y-O-Y.
• Administrative expenses increased to N4.13 billion in 2020, 10.57% Y-O-Y.
• Operating profit increased to N6.47 billion in 2020, 45.58% Y-O-Y.
• Finance income increased to N106.51 million in 2020, 5.39% Y-O-Y.
• Finance Costs decreased to N930.17 million in 2020, 11.39% Y-O-Y.
• Profit from continuing operations increased to N3.92 billion in 2020, 58.88% Y-O-Y.
• Profit from discontinued operations increased to N191.63 million in 2020, 345.68% Y-O-Y.
• Profit for the year increased to N4.11 billion in 2020, 72.10% Y-O-Y.

READ: Vitafoam’s 2020 oncourse to make light–work of 2019

READ: Sterling Bank Plc forecasts N2.09 billion PAT in Q1 2021

What you should know

• Shares of the company have gained 9.6% within the first one hour of trading, largely at the backdrop of news of the company’s impressive performance as the current valuation of the company in the light of its results suggests that the shares of the Company are undervalued at the current price.
• Checks by Nairametrics as of 11:10 am today confirmed that the company is on a full bid, as 4,930,245 bids from 23 investors have been placed at the highest price for the day, without a single offer at a price lower than N8.55.

READ: Ecobank Transnational Inc. records 11% increase in interest income for Q3 2020

Bottom line

The profitability of the company was beefed up in 2020 on the back of the decrease in the cost of raw materials coupled with the increase in sales from the core segment of the company which led to the 5.21% increase in revenue in 2020.

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However, it is important to note that the impressive performance of the Vitafoam Group was also strengthened by the increase in other profit owing to improvement in sales, this helped the company to also grow its revenue from services provided to customers’ after-sales.

Neimeth Pharmaceuticals Plc has reported in its audited financial statement for 2020 that it made a profit of N212.48 million for the year ended 30th September 2020.

This represents a 3.48% decline in profit when compared with the N220.15 million PAT reported in the corresponding period of 2019.

READ: PZ incurs N1 billion in exchange rate loss 

Key highlights

• Revenue increased to N2.84 billion in 2020, 19.73% Y-O-Y.
• Cost of Sales increased to N1.33 billion in 2020, 13.11% Y-O-Y.
• Gross Profit increased to N1.51 billion in 2020, 26.23% Y-O-Y.
• Other income increased to N29.29 million in 2020, 1049.33% Y-O-Y.
• Marketing and distribution expenses increased to N505.11 million in 2020, 33.90% Y-O-Y.
• Administrative expenses increased to N452.28 million in 2020, 20.54% Y-O-Y.
• Exchange loss increased to N188.05 million in 2020, 479.25% Y-O-Y.
• Operating profit decreased to N393.26 million in 2020, -4.87% Y-O-Y.
• Finance costs decreased to N95.87 million in 2020, -12.00% Y-O-Y.
• Profit after tax decreased to N212.48 in 2020, -3.48% Y-O-Y.

READ: Bitcoin miners are super-rich, earn $1,000,000 per hour

Bottom line

The report revealed that despite the impressive performance of the core operating segment of the company, and the increase in the revenue generated from the Animal Health segment, the profit of Neimeth Pharmaceuticals was pressured by rising costs in 2020 and this led to 3.48% decline in profit year-on-year.

READ: Pharma Deko Plc records 1.16% increase in 2020 9M revenues

Neimeth Pharmaceuticals suffered from substantial cost and expenses increase in 2020, as the increase in production cost, marketing and distribution expenses (driven by increased payment to employees in this department), administrative expenses (driven by expenses paid for conference and meetings, bank charges and commission, communication and subscription, energy cost, insurance and medical expenses) and increase in foreign exchange loss driven by naira devaluation, pressured profitability in 2020.