May & Baker Recovers, Records N101m Profit Before Tax
Goddy Egene and Eromosele Abiodun
May & Baker Nigeria Plc said it last year overcame the challenges associated with building and depreciating its world pharmaceutical plant and bounced into profitability. The audited results of the company for year ended December 31, 2014, showed that May & Baker posted pre-tax profit of N101.1 million, compared with a loss of N11.4 million in 2013. The company recorded a profit after tax of N63 million, up from loss of N103 million in 2013. This was achieved on a group turnover of N7 billion, against N6.3 billion in 2013, a growth of 10.2 per cent.
According to the company, cost containment and efficient resource utilisation were responsible for the positive performance in form of reduced financing charges, distribution, sales and marketing expenses.
May & Baker had come under pressure from financing charges and depreciation allowances as a result of its new pharmaceutical manufacturing plant, which was financed largely by loans during the 2008-2009 capital market recession. Finance costs rose by 34.3 per cent to N630.71 million in 2013 compared with N469.63 million in 2012, while the company provided about N240 million annually in 2013 and 2014 out of its gross profit for the depreciation of the new pharmaceutical facility with monthly depreciation average of N19.8 million.
However, with the new plant which is located in Ota, Ogun State, has increased its capacity to produce more products. Specifically, the company raised Its production capacity by over 60 per cent. The new plant, also known as PharmaCentre is a mega investment in the pharmaceutical sector targeted at making
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Nigeria one of the leading producers of quality medicines in the world. It is one of the few Nigerian pharmaceutical facilities that were recently certified by the World Health Organisation (WHO) on Good Manufacturing Practice (GMP). The PharmaCentre is currently undergoing the process of WHO pre-qualification for its specific products.