Caverton Offshore Support Group at the weekend presented its unaudited half-year ended June 30, 2019, to the Nigerian Stock Exchange (NSE), showing that profit before and after-tax rose at a faster pace than revenue, helped by jump in other operating income, in what may ensure shareholders get higher dividends at year-end, if the management and board sustain the current tempo.
Revenue for the period rose by N2.681bn or 18.85% from the N14.222bn reported in the corresponding period of 2018 to N16.904bn, with helicopter and airplane contract remaining the group’s cash-cow, contributing N15.989bn, representing an otherwise unhealthy 94.59% of the total, compared with the previous N13.827bn or 97.22% of the previous total. Helicopter charter pooled N803.384m, up from N310.922m previously; followed by N54.181m from vessel agency services, up from N28.852m; the N51.64m earned from vessel time charter and boat income, as against the previous N49.85m; and the N5.469m earnings from helicopter maintenance, up from N4.673m.
Operating expenses inched by N1.443bn or 15.26%; following which operating profit stood at N6.004bn from N4.766bn, representing an increase of N1.238bn or 25.94%, the biggest of which was the N4.404bn spent on aviation fuel and spare parts, from N3.038bn; followed by N3.621bn in crew salaries, an increase from N2.698bn; even as right to use-aircraft depreciation cost N2.395bn, soaring from N645.002m. Aircraft insurance premium accounted for N374.283m, compared to N352.261m; landing and navigational expenses dropped from N122.081m to N43.094m. The group also did not incur expenses by way of aircraft rentals during the review period, compared to N2.587bn last year.
Administrative expenses rose by N781.654m or 39.18% to N2.776bn from N1.994bn, principally the N1.147bn employee benefits expense, which rose from N568.901m; other expenses and overheads dropped marginally to N534.254m from N573.04m; transport and travels slipped to N256.801m from N265.927m; even as management expenses rose from N188.035m in 2018 to N294.33m.
Other operating income however soared by N432.792m or 823.52% from N52.554m in 2018 to N485.346m, swelled by ‘others,’ which climbed to N371.643m, compared to N17.335m in the 2018 half-year; N92.356m grant income, which rose from N24.872m; just as interest income rose from N10.347m to N20.558. This resulted in a total operating profit of N3.713bn, compared to the N2.824bn in the prior half-year.
Finance cost, which was entirely the interest on debts and borrowings, dropped from N1.267bn to N1.088bn; profit before tax rose to N2.625bn, N750.119m or 77.92% up from N1.556bn. Income tax expense jumped by N318.916m or 53.67% to N913.103m from N594.187m; leaving a net profit of N1.712bn, an improvement of N750.119m or77.93% from N962.451m. which translated to Earnings Per Share of 51 kobo from 29 kobo in the similar period of 2018.