Caverton Posts Loss, Shareholders Fund Wipes Off

Caverton Offshore Support Group Plc.’s loss after tax widened to N12.747 billion in financial year 2023 from N5.163 billion in 2022, the company said in its audited report submitted to the Nigerian Exchange.

In the stock market, the company is now worth N5.22 billion at unit price of N1.56 on 3.350 billion shares outstanding -21.94% of this was free float available for trading as required by the market regulator.

The company earnings broke further despite surge in revenue in the period. This has wiped off its shareholders fund, kept total equity negative at about N748 million.

According to its audited report, revenue from contract that the company executed with its customers rose to N31.998 billion in 2023, up by about 10% year on year from N29.228 billion in the comparable year 2022.

On the other hand, the company’s costs of sales declined by about 3% year on year to N24.827 billion from N25.542 billion a year earlier despite inflation pressures in its local market in Nigeria.

Consequently, gross profit climbed by more than 94% year on year to N7.161 billion from N3.685 billion posted in 2022.

The feat was however damaged the Caverton’s overhead which skyrocketed. Its administrative expenses double down in addition to a significant surge in impairment charge on financial assets.

Other gains line also reversed its previous position while other income line also moderated. Details from its audited results showed that the company’s expended N10.787 billion as administrative expenses in 2023.

This translates to a 110.72% year on year growth compared with N5.119 billion spent on administrative operations in 2022. It also booked N2.378 billion as impairment loss on its financial assets in the period, a significant year on year increase from N402.3 million in the comparable period in 2023.

It also incurred N2.12 billion loss on asset revaluation compared with 927 million gain in 2022.  Its finance income was down by more than 45% in 2023 to N24.930 million from N45.381 million. In 2023, share of loss in associated went down strongly to less than N5 million from more than N240 million in the year 2022.

The company has lost more than N93 million to exchange rate movement, which has added pressures to its capital erosion. The company’s negative capital suggest financial distress.

MarketForces Africa gathered that 78.16% of the company shares are owned by two substantial shareholders –inclusive of Aderemi Makanjuola, its chief executive.  Nigeria Spends $600m Annually on Palm Oil Importation
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