Fidson Battles Rising Borrowing Costs, Declining Profit, Revenue in H1’19

By Dipo Olowookere

One of the leading pharmaceutical companies in Nigeria, Fidson Healthcare Plc, on Thursday released its financial statements for the first half of 2019 and from the brief analysis done by Business Post, the firm’s performance was not too impressive, judging by the key financial parameters.

For instance, the revenue generated in the period under consideration dropped marginally to N7.37 billion from N7.43 billion in the same period of last year.

In the same time, the cost of sales rose slightly to N4.1 billion from N4.0 billion, while the gross profit went down to N3.3 billion from N3.5 billion.

In the results, the administrative expenses went as high as N1.5 billion in H1 2019 against N1.1 billion in H1 2018, while the finance cost zoomed to N896.9 million from N483.9 million.

However, the other operating income improved to N129.5 million from N66.0 million, while the other operating expenses was pruned down to N5.4 million from N16.2 million, with the selling and distribution expenses reducing to N655.5 million in the period under review from N1.1 billion in the same time of last year. This was due to huge cut in the amount used on promotion and advertisement in the period, which significantly went down to N64.8 million from N383.5 million, while the sales expense was sliced to N353.0 million from N610.6 million. However, the logistic expenses increased in the period to N237.7 million from N147.6 million.

The operating profit posted by Fidson, which recently announced a deal with a Japanese drugs firm, marginally increased to N1.27 billion from N1.24 billion, while the finance income closed at N405.8 million as at June 30, 2019 against N766.8 million as at June 30, 2018.

For the bottom-line, the profit before tax depreciated to N405.8 million from N766.8 million, while the profit after tax went down to N275.9 million from N521.4 million.

It would be recalled that some months ago, Fidson raised fresh capital from its shareholders through rights issue. However, the exercise did not record 100 percent success as it was not fully subscribed.

Last year, the firm was picked by GlaxoSmithKline to handle its local production, which many observers expected to positively improve the performance of the drug maker.