Data gathered by BusinessDay shows Rokana Industries Plc is groaning under the hash and unpredictable operating environment bedeviling most firms in Africa largest economy Nigeria as the company recorded loss to end 2012 financial year.
The company which produces and markets toothbrushes, environmental and household cleaning brushes thermoforming and plastic products ended 2012 financial year with a loss of N39.40 million compared to the N43.34 million loss position of the corresponding year of December 31 (FY) 2011.
“The company’s business has not been rosy in the recent times as a result of the inter play of so many factors which include: inadequacy of working capital, high cost of raw materials and diesel,” said the directors report.
“Consequent upon this, Rokana has witnessed a downward trend in it performance over the past few years,” the report stated
Rokana’s cost margin a measure of the relationship between cost of sales and sales moved to 50.01 percent from 47.87 percent last year as huge diesel costs continues to surge production costs.
Operating expenses margin a measure of efficiency was 50.8 percent, which means for every N1 made in sales, the company spent 50K. It should be noted that the 50.80 Opex margin is lower than the 74.16 percent recorded in 2011 financial year.
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A 33.52 percent reduction in Staff costs help reduce operational expenses by 26.80 percent to N56.43 million from N77.01 million the same period of the year. Gross profits were down by 1.1 percent to N52.55 million as against N53.14 million the preceding year.
Finance expenses were up by 79.30 million in the review period to N38.10 million from N21.25 million the preceding year.
It should be noted that the savvy and astute management and boards of directors of company are working assiduously to put in place policies that will revert the company on the part of profitability.
“The management of Rokana is looking into other opportunities including restructuring the company through consultations, interactions and agreements with interested partners/shareholders, which is expected to lead to positive cash inflows and business expansion in the years ahead”, said the director’s report.
Total assets were up by 12.93 percent to N399.13 million as against N353.41 million the preceding year while total equity fell by 52.36 percent to N27.36 million due to recurring loses recorded over time.
The company’s share price closed at N0.60 on the floor of the NSE while market capitalization was N30 million.