Rising cost pressures NASCON’s profits by 46.5% in Q1

Nascon Allied Industries has released its unaudited financial statement for the period ended March 31, 2022, showing how rising costs caused a drop in profit by 46.5 percent, the lowest first quarter result since March 2019.

The salt maker’s profit stood at N386.4 million in March 2022, a 46.5 percent decrease from N723.2 million recorded in March 2021.

As the trading session ended on Monday, Nascon’s share price closed at N12.85.

Revenue climbed 29 percent to N10.76 billion, coming from N8.33 billion in the prior year.

However, the salt maker’s cost of sales jumped to N8 billion as against N5 billion, indicating a huge 60 percent increase year on year.

Nascon spent N7.16 billion on raw materials consumed, a 74 percent increase from N4.12 spent in the prior year.

Nascon Allied Industries stated in a disclosure, “this is to inform Nigerian Exchange Limited, shareholders of NASCON Allied industries Plc (the Company) and the investing public that the Managing Director of the Company, Paul Farrer, has given notice of his resignation as the Managing Director and Chief Executive of NASCON Allied lndustries Plc with effect from 13th March 2022.”

Other income increased to N9.8 million, a huge 161 percent from N3.75 million in the period under review.

Retained earnings jumped 13 percent to N13.26 billion in March 2022 compared to N11.68 billion in the previous year.

Distribution cost rose to N1.88 billion, a 12 percent increase from N1.68 billion in the comparable period.

Administrative expenses climbed 6 percent to N711.5 million, compared to N670.66 million in March 2021.

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Finance income reached N57.7 million from N13.72 million in the period under review.

Finance costs surged to N76.4 million from N13.34 million in the comparable period.

Nascon average number of persons employed dropped to 578 in March 2022 from 582 in the same period last year.

Cash and cash equivalent jumped a huge 184 percent to N9.66 billion from N3.4 billion in the prior year.

The salt maker was able to reduce its net debt by 53 percent to N12 million from N25.37 million. Cash generated from operations stood at N2.75 billion, a huge 109 percent from N1.31 billion.

Inventories surge 35 percent to N5.67 billion in March 2022, as against N4.2 billion in the prior year.

Operating expenses increased to N1.88 billion, 12 percent from N1.68 billion in the comparable period.

Net cash from operating activities rose by a huge 111 percent to N2.75 billion from N1.3 billion. Net cash from investing activities increased to N17 million from a loss of N346.7 million.

The salt maker’s net cash used in financial activities recorded N150.8 million from an N145 million year-on-year loss.

NASCON Allied Industries Plc was established as a salt refining establishment under the name National Salt Company (NASCON). The company has since evolved with additional business lines to include Vegetable Oil, Tomato Paste and Seasoning with production facilities in Lagos State, Ogun State and Rivers State.