UnityKapital PAT Up 142% As Tantalizers Reports N2.35bn Losses | Independent Newspapers Limited
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UnityKapital PAT Up 142% As Tantalizers Reports N2.35bn Losses

Posted: Apr 6, 2016 at 7:58 pm   /   by   /   comments (0)


Bamidele Ogunwusi LAGOS


Despite a drop in gross premium from N3.115 billion to N2.684 billion, management of UnityKapital Assurance, has informed stockbroker and management of The Nigerian Stock Exchange (NSE) on Wednesday that its profit after tax rose by 142 percent.

The company informed in its full year financial result ended December 2015, that its net profit rose from N141.477 million reported in the corresponding period of 2014 to N340 million.

Net premium earned  dropped to N2.095 billion from N2.509 billion, underwriting profit  which was N1.385 billion in 2014 slipped to N1.043 billion, representing a drop of 25 per cent, profit before tax posted an improvement of N237.695 million or 136 per cent to close at N411.081 million from N175.024 million.

Meanwhile, fast food giant, Tantalizers Plc, reported a loss after tax of N707 million as against a loss of N784 million recorded in 2014. According to its financial statements for the year ended December 2015, revenues dropped 34 percent to N1.9 billion during the year from N2.9 billion.

Tantalizers spends about 85 percent of its N2.35 billion revenues on local materials and services, leaving it with just N286.6 million to pay for salaries, interest on loans (N208.8 million) and depreciation (N390.2 million).

This is the 4th consecutive year of losses for the company, having reported a loss after tax of N303.4 million, N564.8 million, N784.2 million and N707 million for 2012, 2013, 2014 and 2015 respectively. The losses over the years have now swelled its negative retained earnings to about N2.59 billion, indicating that dividends might not be paid in the nearest future.

Tantalizers also reported a negative cash flows of about N199 million despite selling properties worth about N339 million. It’s operating cash flows was negative as the company spent more cash on operating expenses that it earned. To remain afloat, the company had to survive on overdrafts.

Tantalizer currently has total external loans of about N1.4 billion from a trio of Nigerian banks and the IFC. The loans appear to be doubtful going by this result even though the company reported that it had restructured the loans.

The fast food giant reported that it restructured loans of about N395.5 million to 2020 and another loan of N262.1 million to 2019. Nigerian banks often restructure loans to a longer term tenor when it is obvious that the original terms of the loans might lead to a bad loan. Tantalizers also owes GTB N8 million, Bank of Industry N292.5 million (2019) and IFC N346.7 million. The tenor of the loans suggest the company must have entered a restructuring deal with all of its banks as cash flows indicates it cannot accommodate prior repayment terms.