Vitafoam records N159m loss in nine months

As weak revenue and hike in finance charges, Vitafoam Nigeria Plc has announced N159 million loss in nine months.

The household company in its unaudited financial statements for the period ended June 30, 2016 shows a poor state performance compared to prior nine months of 2015.

The company had announced N335 million profit after tax in nine months of 2015 following improved revenue generation and marginal growth in finance charges.

Loss before tax closed the period at N49 million compared to N521 million recorded in prior nine months of 2015.

For the period under review, the company’s revenue dropped by 21 per cent to N10.99 billion from N13.8 billion recorded in June 2015.

The company’s primary geographical segment is Nigeria and over 99.9per cent of the sales of the company were made in the country.

Also, finance cost rose by 31 per cent to N728 million from N554 million attributable to hike in foreign exchange and interest rate on banks charges.

Hitherto , the Group Managing Director and Chief Executive Officer, Vitafoam Nigeria Plc, Taiwo Adeniyi had called on the Government to ensure that genuine manufacturers have access to official foreign exchange window, to reduce cost of production.

He had expressed optimism that his company’s performance indicators would not be affected adversely by the ongoing business challenges.

He expressed concern that the government’s failure to create a special window for foreign exchange exclusively for genuine manufacturers has exposed the sector of the economy to the vagaries of the naira’s exchange rate in the parallel market.

According to him, while traders could easily pass the increasing cost of funds to the consumers, manufacturers in Nigeria could not do that.

He also decried the enormous amount being spent on power generation in the real sector, due to the current epileptic supply.

Adeniyi, who unfolded some strategies to sustain shareholder value explained that Vitafoam remained committed to value creation and delivery as one of the fundamental principles that define the company’s operations.

Commenting on the current efforts to sustain Vitafoam’s competitive edge, he noted that the company places premium on the realignment of internal processes to cut waste, development of human capital and investment in research and development, in consonance with the needs of the customers.

Adeniyi stated that the company‘s shareholder value would not be compromised, hence the need to remain innovative and competitive.

“We remain committed to our shareholders as ever before to make returns to them. They will not be disappointed because, for us as management, our responsibility is to return good dividend to our shareholders. That is our target and they will surely get good return for their investment,” Adeniyi said.