Covid-19 weighs on Caverton as firm records N5.9bn loss in 2021

Like every aviation company, Caverton Offshore Support Group Plc, a major provider of marine, aviation and logistics services to local and international oil and gas companies in Nigeria has been impacted by Covid-19 as the firm announced its unaudited results for the period ended 31st December 2021, showing a loss of N5.9billion.

Data gleaned from the firm’s financials showed the company recorded revenue of N34.76bn (N32.17bn in 2020), gross profit of N9.79bn (N13.58bn in 2020), total operating profit, (excluding Finance costs), of N0.026bn, (N5.285bn in 2020) and Earnings Before Interest, Taxes, Depreciation, and Amortization for the period of -N3.92bn (N1.67bn in 2020).

The company also recorded a Profit-Before-Tax of N5.60bn, (N1.26bn in 2020), and Profit-After-Tax of -N4.34 bn, (N1.18bn in 2020), EPS of -128 kobo, (35 kobo in 2020).

Caverton’s profitability ratios include gross margin of 28.16 percent (42.28percent in 2020), EBITDA margin of -11 percent (five percent in 2020), net profit margin of -12.49 percent( 3.67 percent in 2020) EBIT/interest expense is 0.67 percent, (0.41 percent in 2020).

The Capital structure ratios include net debt/Equity of 1.28x (0.93x in 2020), net debt/EBITDA of -5.67x (12.22x in 2020), long-term debt/Total capitalization of 0.53x (0.42x in 2020), asset turnover of 0.44x (0.48x in 2020), and EBIT/capital employed of -0.07 percent (14 percent in 2020).

Bode Makanjuola, Caverton’s chief executive officer, said that the loss was caused by the significant reduction in revenue due to several mitigating factors because of the Covid pandemic which resulted in drop in oil production and net foreign exchange loss due to Naira devaluation against the dollar.

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“As a result of this our direct costs increased significantly in 2021.”

Commenting further, the CEO stated that, notwithstanding the loss reported in 2021, Caverton has robust reserves to accommodate this loss and a bulk of the reported loss is a one time charge on our accounts which arose from high start-up costs of our most recent helicopter contract with Chevron.

To further boost revenues, the Group has been exploring further opportunities within and outside the oil and gas sector. In addition to growing our market share in the oil and gas logistics sector, our primary focus for the year will be on third party training and maintenance.

“Our Maintenance Repair and Overhaul (MRO) facility and our Caverton Aviation Training Centre (CATC), both in Lagos, officially commenced business operation in the 2nd half of 2021. Prospects for training and maintenance are extremely positive as we are in advanced contract negotiations with a number of government and private institutions across Sub-Saharan Africa.

Caverton Aviation Training Centre (CATC) full flight simulator gained full certification by EASA, (European Union Aviation Safety Agency), in October 2021. The EASA’s mission is to promote the highest common standards of safety and environmental protection in civil aviation.

“The Agency develops common safety and environmental rules at the European level. With global certification by an internationally recognized body CATC is now suitably qualified to undertake simulator training on the AW139 helicopter for Pilots from Nigeria and any part of the world and we expect this to not only boost the Group’s revenue in the coming year, but also reduce capital flight from Nigeria,” Makanjuola said.

Ifeoma Okeke-Korieocha

Ifeoma Okeke-Korieocha is the Aviation Correspondent at BusinessDay Media Limited, publishers of BusinessDay Newspapers. She is also the Deputy Editor, BusinessDay Weekender Magazine, the Saturday Weekend edition of BusinessDay. She holds a BSC in Mass Communication from the prestigious University of Nigeria, Nsukka and a Masters degree in Marketing at the University of Lagos. As the lead writer on the aviation desk, Ifeoma is responsible and in charge of the three weekly aviation and travel pages in BusinessDay and BDSunday. She also overseas and edits all pages of BusinessDay Saturday Weekender. She has written various investigative, features and news stories in aviation and business related issues and has been severally nominated for award in the category of Aviation Writer of the Year by the Nigeria Media Nite-Out awards; one of the Nigeria’s most prestigious media awards ceremonies. Ifeoma is a one-time winner of the prestigious Nigeria Media Merit Award under the 'Aviation Writer of the Year' Category. She is the 2025 Eloy Award winner under the Print Media Journalist category. She has undergone several journalism trainings by various prestigious organisations. Ifeoma is also a fellow of the Female Reporters Leadership Fellowship of the Wole Soyinka Centre for Investigative Journalism.