Vitafoam net profit up by 72% despite COVID-19


A diversified manufacturer of foams and other household equipment, Vitafoam Nigeria Plc has posted a net profit growth of 72 per cent for its financial year ended September 30, 2020.

The company ascribed its current stellar performance despite the inclement operating environment, to innovation and expansion.

The audited results released on the Nigerian Stock Exchange (NSE) showed that net profit soared by 72 per cent from N2.39 billion to N4.11 billion. Basic earnings per share increased from N1.82 to N3.05 and Net assets per share hit N7.25 in 2020, 54.3 per cent above N4.70 recorded in 2019.

On the strength of the company’s outstanding performance, board has recommended a cash dividend of N979.4 million for 2020, 64.5 per cent above N595.4 million paid in 2019. The current dividend translates into 70 kobo per share as against 42 kobo paid in the preceding year.

Speaking on the results, the group managing director and chief executive of Vitafoam Nigeria, Mr Taiwo Adeniyi, said: “Innovation is the drive. As a matter of corporate policy, we do continuous improvement on our products. We sell high margin products. We are highly connected with our customers. We know their different needs and as such our products always gain acceptance in the market. Our foams and other products meet specific needs.”

He noted that, “our investment in the subsidiaries as a growth strategy is beginning to pay off. All of them have turned profitable. We are not insulated from the tough operating environment as all the indices that should drive growth in the manufacturing sector are weak. But due to our innovative efforts, our balance sheet today is one of the strongest in the industry. We have capacity to sustain the trajectory and we shall continue to reward our shareholders accordingly.”

Despite the adverse impact of COVID-19 pandemic, the company’s turnover rose by 5.2 per cent from N22.28 billion to N23.44 billion. Cost of sales dropped by 8.1 per cent from N13.52 billion to N12.43 billion. Gross profit thus rose by 25.7 per cent from N8.76 billion to N11.01 billion.

Also, the managing director and CEO, Network Capital, Mr Oluropo Dada said, “It was a remarkable improvement on all the quantitative and qualitative parameters of the company which expectedly translated to better results with a bountiful reward to all the stakeholders. Shareholders are going home with higher dividend while the performance translates into higher valuations of investment for analysts and traders.

The announcement of the results has attracted investors to Vitafoam’s shares on the Exchange and positioned it as one of the most stabled stocks. With its current net assets per share of N7.25, market watchers believe that Vitafoam’s share price is due for re-pricing on the Nigerian Stock Exchange.


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