Barely one week after Neimeth International pharmaceutical, a player in the Nigerian healthcare space declared its nine month unaudited financial result showing recovery, its shares has moved up by 31 percent at the Nigerian Stock Exchange.
The firm’s share price that was trading as low as N0.42k, the lowest this year gained a 31 percent (13 kobo) rising to N0.55k at the end of trading Wednesday august 1, 2018.
Given that the firm has outstanding shares of 1.73 billion, the market cap also increased by 18.9 percent from 726 million to N863.253 million as at close of market Wednesday.
“What this signifies is that investors are beginning to react to the positive result by the firm, Dolapo Ashiru a stockbroker said, and hence they are adjusting to their predictions based on the firms result”.
The drug maker saw a positive growth reporting a profit after Tax of N31.7 million in the third quarter of 2018 after it recorded a loss of N63.4 million in the same period last year, according to figures obtained from its nine month unaudited financial statement.
Revenue generated by the company also saw a 45.2 percent increase from N314.9 million in 2017 to N457.4 million in 2018, with 99 percent of the revenue generated from pharmaceuticals, while 1 percent came from animal health. The finance cost also decreased by 45 percent to N18.9 million from as high as N35 million in 2017
Of this revenue figure, 98 percent came from its Nigeria arm, while 2 percent of the revenue generated was from the Ghana segment of the company.
The firms Earnings per share (EPS) which is seen as a portion of the company’s profit allocated to each outstanding share of common stock currently stands at -0.24
Neimeth Pharma starts a new financial year November of every year. Thus why other firms in the industry might be in their 2nd quarter or half year of operation, Neimeth books will be for a nine month or Q3 period.
The firm has a one year return of -30.38 percent, according to data compiled by Businessday, with its share price touching its peak at N0.96 around 18th January 2018, but currently trading at N0.55 yesterday.
Analysts said the recent result posted by the firm might increase investors’ appetite for the firm’s share thereby making the firm’s share price to rally.
On what could have triggered the company’s profit for the quarter, Johnson Chukwu, the MD of Cowry Asset Limited said the fall in the company’s finance cost as well as administrative expenses aside the growth in its turnover, brought about an improved performance for the company.
“The finance cost was as a result of either the company paying back its loan or the revision of their interest cost. This shows the company’s efficiency in cost. Hence, for the company to finance its debt, money was raised from the capital market but at a lower rate,”
“Furthermore, there is a high tendency for the recent profit of the company will have positive impact on their share capital.” Chukwu said in a phone response to BusinessDay.
MICHEAL ANI
