Unilever Ghana Limited [UNIL] achieved success after implementing its revenue growth strategy for Q1-2017 at the start of this year. The company churned out an impressive 8.76% growth in revenue for Q1-2017which was above the industry average of 4.3% for the period. Total Revenue increased to GHS 138,284,000 in Q1-2017 from GHS 127,143,000 same period in the prior year. Operating Profit for Q1-2017 however fell by 50.09%; from GHS 18,776,000 in Q1-2016 to GHS 9,372,000. The dip in Operating profit for the period has been attributed to increases in the price of raw materials, restructuring costs as well as brand & marketing costs.
Finance income for Q1-2017 also fell by 85% while Finance cost increased by 540% compared to Q1-2016. At the close of the first Quarter of 2017, Profit before Tax stood at GHS 8,492,000 representing 54.90% dip from the GHS 18,829,000 recorded in the same period in prior year. Profit after Tax equally fell from GHS 14,032,000 in Q1-2016 to GHS 6,438,000 representing a decline of 54.11% in after tax Profit. Earnings per share [EPS] was GHS 0.4121 for Q1-2017 compared to GHS 0.8980 reported in Q1-2016 earnings report.
Total Assets value of UNIL stood at GHS 428,640,000 in Q1-2017; representing an increase of 28.65% from GHS 333,177,000 in Q1-2016. Net Asset Per share increased to GHS 1.31 in Q1-2017 compared to GHS 1.25 same period last year. Return on Assets [ROA] fell from 4.21% in Q1-2016 to GHS 1.50% in Q1-2017. The dip in ROA is a clear indication that management was inefficient in generating returns on company’s assets deployed for production. Return on Equity also fell from 17.99% in Q1-2016 to 7.85% in Q1-2017. This represents a fall in the returns on shareholders’ net worth with regards to their investments in UNIL.
GN Analysts estimate that the dip in the profits of the company could negatively impact the share performance of UNIL in the short term. UNIL currently records YTD capital gains of 6.35% on the bourse. GN Analysts also estimate some positive earnings projections in the upcoming quarterly performance of the company on the back of anticipated growth in the agric sector, relative fall in the price of raw materials and the support of UNIL in the implementation of the One District-One Factory government initiative for the industrialization.
Trading activity on the bourse ended with 1 gainer [GOIL] and 1 loser [GGBL] yesterday. GGBL topped the trading chart in terms of volume as 2,023,700 shares worth GHS 3,035,556.00 changed hands. Returns on the Composite and Financial Stock Index pegged at 12.24% and 16.36% respectively.
Trading activity on the Alternative market was hushed as no shares changed hands.
HORDS currently lead record capital gains on the GAX, appreciating by 25% from 2016 year open.
The Cedi LOST marginally to the Dollar and Euro but GAINED to the British Pound yesterday.
The local currency exchanged at a mid-rate of GHS 4.1887 to the USD, GHS 5.4117 to the GBP and GHS 4.5673 to the EURO.
The GCFM Cedi index, a measure of the holistic performance of the Cedi on the inter-bank market now records a year-to-date depreciation of 1.45%.
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