C&I Leasing, a fleet management, outsourcing and marine services company in Nigeria, Ghana and UAE has reported a Profit Before Tax of N484.9 million for the year 2021, a 2.1% year on year high from the N471 million the previous year.
The unaudited financial result seen by Nairametrics shows that the company’s shareholders’ fund also saw a slight rise by 3.3% during the year to a value of N13.77 billion compared to the N13.34 billion in 2020 as total assets moved along the same direction inching northward by 3.74% to hit N58.13 billion.
The result reflects a mixed performance from the company’s subsidiary personal outsourcing earnings rose by 8.6% to N11.5 billion in 2021 from N10.6 billion in 2020 while the lease rental income comprising fleet management earnings and marine earnings declined by 9.1% to N16.22 billion during the same period.
The earning growth in outsourcing business was owing to the increase in volume of existing contracts as well as new contracts awarded within the period caused by heightened demand for the business process outsourcing services as the company continued to gain attention on social media and other awareness platforms by matching job seekers and recruiters.
On the other hand, the fleet management business and marine business downward trend is a result of still trying to recover from the pandemic. According to the company, the low oil prices at the early stage of the COVID-19 pandemic led to a reduction in daily rates of international oil companies (IOCs). Even with a steady increase in oil prices during the period which saw the prices of oil attain approximately 80 USD /bbl in Q4 2021, oil companies were not willing to increase daily rates for vessel charter back to pre-covid rates,
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Similarly, there was a 6.1% drop in personnel cost from N1.37 billion in 2020 to N1.29 billion in 2021 due to better optimization of processes and procedures with the increased use of online trainings which came at lower costs spurring further reduction.
Other administrative and general expenses dropped by 36.8% from N1.7 billion in 12M 2020 to N1.085 billion in 12M 2021 majorly due to the cost optimisation drive highlighted above with finance cost valuing N4.6 billion, showing a declined by 15.1% year-on-year from N5.4 billion.
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Notably, the company raised a N10 billion corporate bond (tranche II of the approved N20 billion capital raise) meant to augment the business plan and give the capital structure a better form.
What they are saying
Ugoji Lenin Ugoji, Chief Executive Officer/MD of C&I Leasing Plc stated that COVID-19’s pandemic rippling effects are still being felt by both economies and by extension in most businesses where the company operates as there was dull demand for some products alongside rising cost of goods.
“This affected the cash flows of a lot of businesses. However, GDP growth rates of Nigeria and Ghana are expected to be at 2.7% and 6.17% respectively for 2022 and we envisage an increase in demand for products as both economies continue to open and an increased recovery of oil demand,” he said.
He added that inflationary pressures, as well as exchange rate fluctuations, have been issues the company continues to deal with adding that measures are in place to e hedge against such uncertainties and an increased focus is now being given non-asset-based revenue options to create a counterbalance for low asset utilization caused by shrinking demand for the assets.
Ugoji said, “Despite the challenges, we have remained focused on cost optimization, business process improvement initiatives and ensuring efficiency in the management of our sales performance. We are also actively working on digitizing our value offerings across the Fleet Management, Outsourcing and Marine businesses with increased attention on our emerging E-Business platforms. As you may be aware, people empower technology, technology empowers innovation, the business landscape changes, and this cycle continues, yielding positive results in the long run.”