BUA Cement Plc in its recently released quarterly filings has revealed that the cement manufacturing company made a profit of N16.95 billion in the last quarter of 2020.
This is according to the information and figures contained in the company’s unaudited result, which was published on the website of the Nigerian Stock Exchange (NSE).
The Cement company’s unaudited financial statements for Q4 2020, revealed that the profit which BUA Cement made in the final quarter of 2020, was 2.34% lower than the profit it made in the corresponding quarter of 2019, as the company’s profit after tax declined from over N17.35 billion to N16.95 billion.
- Revenue increased to N52.92 billion, up by 14.83% Y-o-Y.
- Cost of sales increased to N29.22 billion, up by 9.16% Y-o-Y.
- Gross profit increased to N23.70 billion, up by 22.68% Y-o-Y.
- Other income decreased to N1.91 billion, down by 19.18% Y-o-Y.
- Selling and Distribution Costs decreased to N3.03 billion, down by 13.64% Y-o-Y.
- Administrative expenses decreased to N2.44 billion, down by 44.76% Y-o-Y.
- Operating profit of N20.15 billion was recorded, indicating an increase of 14.98% Y-o-Y.
- Finance costs decreased to N565.29 million, down by 61.63% Y-o-Y.
- Profit before tax increased to N19.58 billion, up by 22.01% Y-o-Y.
- Profit for the period however decreased to N16.95 billion, down by 2.34% Y-o-Y.
What you should know
It is important to understand that the effective mix of revenue optimization and cost minimization strategies deployed by the company were responsible for the improved performance of the company, as revenue increased by 14.8%, while costs from administrative activities as well as distribution and marketing during the period under review declined significantly.
This was responsible for the 14.98% boost in operating profit. It is important to note that the cost-effectiveness of BUA Cement is largely hinged on its relatively new cement production plants, which continue to operate at optimal levels thus reducing costs coming from operations.
BUA Cement did well in the fourth quarter of 2020, however, impairment write-back of N3.76 billion as well as a tax credit of N1.31 billion which the company stated in its Q4 2019 results drove its profit to N17.4 billion. In the absence of these provisions, the company would have made a profit of about N12.3 billion, 27.5% lower than Q4 2020 figures (N16.95 billion).