Caverton Offshore Support Group Plc (Caverton) has seen a 19 per cent upturn in first quarter revenue to N5 billion, with efficient cost management growing earnings by 73 per cent.
The leading provider of marine, aviation and logistics services to local and international oil and gas companies in Nigeria released its 2017 unaudited first quarter results on Friday, April 28, in Lagos, revealing that profit before tax (PBT) for the period grew to N355 million from N209 million in the first quarter of 2016.
Commenting on the results, Bode Makanjuola, Caverton’s Chief Executive Officer, said that the results further highlight the continued commitment of streamlining the company’s operations in the face of tough economic conditions and reduction of activities by International and Local Oil and Gas companies that continue to impact the service sector of the industry.
“While the marine service sector has been impacted negatively by the reduction in patronage and services, we are actively re-strategizing and positioning the company to pursue opportunities within and out of the oil and gas sector,” Makanjuola said.
The results showed that revenue climbed 16 per cent as direct operating costs improved by 19% to send earnings per share surging to N722 million, from N418 million in the corresponding quarter of 2016.
Company’s gross margin was 32 per cent, 2 percentage points drop from the levels in March 2016; EBITDA margin stood at 21 per cent.
In addition, Caverton’s ability to pay interest on its outstanding loans increased as interest coverage (defined as EBIT/Interest Expense) rose from 1.6 times as at March 2016, to 1.8 times in the quarter (ended March, 2017).
The company’s capital structure indicates an unchanged gearing levels as Net debt/equity debt to equity ratio remained at 0.73 times, the same level for March, 2016. Total debt/total capitalization stood at 3.4 compared to 3.2 in March 2016. Asset turnover, which indicates the efficiency with which the company deploys its assets in generating revenue, was 0.11 for the quarter.
The company generated 6 kobo as earnings for every one naira of investors’ money. Earnings per share jumped 100 per cent to 6 kobo, from 3 kobo in the 3rd quarter of 2016.
Makanjuola said that apart from the company’s continued focus on cost efficiency, which is evident from the decline in operating costs by 19% in the first quarter of 2017, the company is also focused on further expanding its business model and service offering.
“Our Maintenance Repair and Overhaul (MRO) facility in Lagos, when completed will herald a new age in the Nigerian aviation sector and better fortune for the company and industry at large.
Caverton Offshore Support Group Plc was formed in June 2, 2008, though a merger of Caverton Marine and Caverton Helicopters.
Caverton Marine is one of the fastest growing indigenous shipping companies in Nigeria, which commenced operations in 1999. Caverton Helicopters, established in 2002, is a helicopter charter, sales and Maintenance Company.
The group’s focus and primary business is to provide logistics and environmental support services to oil and gas fields with broader plans to support energy operations along the West African shelf as well as other ancillary support services.
Caverton has a young and growing fleet of vessels and aircraft operating out of nine locations. The company has an impressive oil and gas client base which include Shell, Total, ExxonMobil, NNPC, Aiteo, Aje-Folawiyo, and Chevron, among others.
IFEOMA OKEKE
