The board of GlaxoSmithkline Consumer Nigeria, on Tuesday presented its audited result for the year ended December 31, 2016, showing that while profit after tax for the year from continuing operations rose to N2.378bn from N873.134m, there was a loss for the year from discontinued operations of N1.406. It therefore took a profit after tax from disposal of the group’s drinks business of N3.229bn to bring total profit after tax for the period to N4.201bn, up by 335.32% from the N965.047m reported in 2015. This translated to “Earnings Per Share from continuing operation of 199 kobo from 86 kobo;” while “EPS from continuing and discontinuing operation rose to 351 kobo from 95 kobo.” The board has recommended a final dividend of 30 kobo, amounting to a payout of N359m.
Details of the result showed that sales revenue fell by about N1bn from N15.391bn to N14.384bn, of which the pharmaceuticals segment contributed the bulk N9.115bn, while consumer healthcare garnered N5.268bn, with cost of sales reducing to N5.418bn from N9.965bn, yielding a gross profit of N8.966bn, compared to the previous N5.425bn. A total 98.7% of revenue was earned in Nigeria and 1.3% in Ghana. The pharmaceuticals also accounted for N3.763bn sales cost and N1.654bn for consumer healthcare products.
Investment income rose 907.19% to N171.556m from N17.033m in 2015; just as other gains and losses rose by an equally significant 137.52% from N406.77m to N5.999bn. Selling and distribution cost dropped slightly to N2.255bn from N2.63bn; administrative expenses also dropped marginally to N1.182bn from N1.319bn. There was a royalty fee recovery of N484.861m, as against previous year’s expense of N19.638m.
Finance cost for the period dropped to N108,000 from N1.04m.
With these, profit before tax was a paltry N185.891m, compared to N1.065bn in 2015, while a N2.192bn tax credit raised profit after tax from continuing operations to N2.378bn, as against the previous N873.134m.
A breakdown of the pre-tax figures, showed that GSK suffered N1.89bn loss from the pharmaceutical business, while consumer healthcare yielded a N2.076bn profit.
Meanwhile, the auditors noted the sale of the drinks manufacturing, bottling, marketing, distribution and selling of its Lucozade and Ribena brands to Suntory Beverage & Food Nigeria Limited at their carrying amounts on September 30, 2016, as approved by the shareholders at a meeting on July 4, 2016.
The transaction, Akintola Williams Deloitte, the auditors, noted, is a key audit matter, being of significance “to the company as it reduces it operations by more than 60%.”