Berger Paints Nigeria Plc, a prominent Nigerian paint manufacturer, has announced a remarkable surge in profits for the initial six months of 2023.
The company’s profit skyrocketed by an impressive 136.5 percent, reaching N299 million in contrast to the N126.4 million reported during the same period in 2022.
Berger paint profit growth achieved by 98 per cent decrease in finance costs
This substantial growth was chiefly fueled by a significant 98.36 percent decrease in finance costs, plummeting from N10.9 million in the first half of 2022 to just N667,000 in the same timeframe this year.
This drastic reduction in finance costs was primarily attributed to a decline in interest expenses on borrowings, which plunged from N8.139 million in the first half of 2022 to a mere N667,000 this year.
This indicates that Berger Paints has effectively managed to curtail its borrowing expenses, demonstrating its ability to generate ample cash flow and income to efficiently manage its debts and fulfill its financial obligations.
Moreover, the company witnessed a commendable 16 percent upswing in revenue, reaching N3.5 billion in the initial half of 2023, in comparison to N3 billion recorded during the corresponding period in 2022.
However, a notable portion of this revenue growth was absorbed by the cost of sales, accounting for 66.6 percent of revenue, which surged from N2.08 billion in the first half of 2022 to N2.36 billion this year.
While operating expenses experienced a slight uptick of 3.6 percent, escalating to N794.6 million in the first half of 2023 from N767 million in the same period in 2022, the company managed to bolster its other income, which climbed from N26 million to N49.7 million in the respective timeframes.
In terms of cash flow, the net cash generated from operating activities escalated significantly, from N195.9 million in the initial half of 2022 to N313.6 million in the comparable period of 2023.
Meanwhile, net cash utilized in investing activities decreased by a substantial 84.5 percent, shrinking from N251.1 million in the first half of 2022 to N39 million this year. This decline is primarily attributed to decreased investments in financial assets.
Nonetheless, the net cash utilized in financing activities exhibited a loss of N229.8 million during the initial half of 2023, in contrast to a loss of N196.9 million reported during the same timeframe in 2022, primarily due to higher dividend payouts.
As of June 30, 2023, Berger Paints Nigeria Plc’s cash and cash equivalents stood at N618.6 million, marking a noteworthy surge from N467.9 million during the corresponding period in 2022. Earnings per share also witnessed a substantial surge, ascending to N103 for the first half of 2023, in contrast to N44 in the same period in 2022.
