Cable Manufacturer Cutix Forecasts N221mn Profit
Cable manufacturer Cutix Plc has forecasted to see moderate profitability in the third quarter of the financial year 2023, according to a recent filing with the Nigerian Exchange.
In making its assumption, Cutix said the global market continues to experience shortages of raw materials and high inflation due to the impact of Ukraine and Russia conflict.
“We anticipated a decline in revenue to the tune of 7% in the third quarter of 2023 when compared to the second quarter due to Christmas holidays”, the company said.
For the period, the company said its profit before tax is estimated to be N221 million based on the assumptions that raw material cost to sales will be about 60% of the third quarter of 2023 revenue.
It also assumes that there may be high finance costs due to two times hike in the monetary policy rate by Central Bank, estimated that distribution cost will decrease slightly in the third quarter when compared with the second quarter due decrease in revenue.
It projected that Advert and Promo costs will increase in the period when compared to the previous quarter due to the company’s intention to go for television advert.
It said cash receipts from customers will be about 80% of its revenue, saying that there will be an increase in the cash outflow due to high raw material costs.
“We anticipate an increase in investing activities in the third quarter of 2023 for Property Plant and Equipment”, the company said in the forecast note.
The cable company also anticipate a decrease in financing activities in the third quarter of 2023, as the repayment of term loan obtained from Bank of Industry has been completed.
Net Cash and bank balances in the second quarter are expected to increase slightly when compared to the first quarter of 2023 due to its assumptions.
# Cable Manufacturer Cutix Forecasts N221mn Profit#
