Chams’ revenue appreciation, tax expense cut elevate profit in Q1
Chams, Identity Management and E-Payment solution provider announced a 53 per cent improvement in its bottom-line driven by better revenue generation and lower tax expense in the first quarter of 2019.
The significant gains trickled down to grow profit after tax as Chams posts N182.84 million for the quarter.
Highlights of the company’s financials show that revenue grew to N1.26 billion, 70 per cent more than it noted in the year before. Even though the cost of sales grew faster at 104 per cent year on year to N848.45 million in 2019, Chams was able to grow gross profit by 27 per cent to N410.94 million in the period.
For the quarter, operating profit saw an improvement of 41.46 per cent as it hit N183 million compared to N129.65 million in the first quarter of 2018. The surge was triggered by a 31 per cent rise in other operating income to N17.84 million, outpacing the 17 per cent increase in administrative expenses over the same time period.
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Finance expense rose from N122, 000 to N734, 000 but was compensated for by a finance income of N363, 000.
Consequently, the Information and Communications Technology (ICT) Company’s profit before tax grew 41 per cent to N182.85 million in the first quarter of 2019 as against N129.52 million noted a year before.
Tax expense declined by 100 per cent approximately, to N11, 000 compared to N10.36 million tax expense incurred by Chams in the same quarter of 2018. The decline in tax helped sustain the momentum as profit after tax grew 53 per cent from N119 million in the first three months of 2018 to N182.84 million in the corresponding period of 2019.
Last year, Chams broke a 3-year consecutive loss streak as the company turned the corner to hit a 5-year high-profit level for the full year 2018. The growth in profit in the first three months of 2019 would be a much-needed catalyst to sustain its improved performance or perhaps raise the bar for 2019.
For the first quarter of 2019, Chams grew its assets by 16 per cent from N2.99 billion in Q1 2018 to N3.47 billion while liabilities declined 4 per cent to N4.16 billion.
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Shareholders’ equity or Net Asset ballooned by 176.75 per cent to N1.95 billion from N704.67 million over the review period.
Chams Plc provides integrate identity management systems and verification platforms in Nigeria. The company operates in three segments: Identity Management and Solutions; Payments, Collections, and Transactional Systems; and ICT Training.
The Identity Management and Solutions segment provides identification solutions for corporations, educational bodies, and government.
Shares of Chams plc grew 8.7 per cent to close at N0.50 on Tuesday. Chams have gained 150 per cent so far in 2019 after opening at N0.20 when trading commenced January 2.