11 Plc, Ardova post N1.8bn profit in first quarter 2020
11 Plc, formerly Mobil Nigeria Plc, and Ardova Plc, formerly Forte Oil Plc, both recorded double-digit growth in their revenues in the first quarter of 2020. 11 Plc grew its Q1 2020 revenue by 17.8 percent to N54.28 billion up from N46.07 billion in Q1 2019. But its cost of sales mirrored revenue generation in that it grew by 22.1 percent from N42.4 billion in Q1 2019 to N51.8 billion in Q1 2020. The implication of the rising cost of sales in the first quarter is that cost to sales rose from 92.1 percent in Q1 2019 to 95.5 percent in Q1 2020.
Consequently, gross profit declined by 32.6 percent to N2.46 billion in Q1 2020 from N3.65 billion in Q1 2019. Other income grew by 2 percent from N2.01 billion to N2.05 billion during the reference periods. But that increase was cancelled out by an 8 percent and 5.5 percent increase in selling and administration expenses and administration expenses respectively.
“The Covid 19 crisis continues to impact all businesses, with the effect expected to be more pronounced in the future. The priority for us is to protect the health, safety and welfare of all stakeholders under our duty of care as well as support the government and its agencies as they work to reduce the impact of the outbreak. The company has a strong balance sheet, and the board and management are focusing on efforts to mitigate the impact on our business”, 11 Plc stated.
Operating profit declined by 41.6 percent to N1.86 billion from N3.18 billion during the reference periods. Profit after tax declined by 37 percent to N1.28 billion in March 2020 down from N2.04 billion in March 2019.
Ardova Plc exhibited a similar trend in its financials at the end of March 2020. Revenue grew by 22.3 percent to N52.05 billion in March 2020 from N42.56 billion in March 2019. However, growth in cost of sales by 24.7 percent surpassed that of the growth in revenue.
Cost to sales rose to 94.6 percent in March 2020 from 92.8 percent in March 2019. Gross profit declined by 9 percent to N2.79 billion down from N3.06 billion in the previous year.
Profit before tax fell by 81.5 percent to N580.30 million in March 2020 from N3.13 billion in March 2019. Profit after tax fell by 85 percent to N497.44 billion in March 2020 as against N3.32 billion in March 2019.