Caverton records N50.53bn loss in 2024

Caverton Offshore Support Group Plc has reported an N50.53bn loss for the financial year ended December 31, 2024, marking a decline from the N12.89bn loss recorded in 2023.

In the company’s unaudited financial statement filed on the Nigerian Exchange Limited on Thursday, the downturn was primarily driven by an N43.49bn net exchange loss, reflecting the impact of foreign currency translation amid Nigeria’s volatile forex market.

Despite the loss, Caverton saw a 42.7 per cent increase in revenue, reaching N45.64bn in 2024 from N31.99bn in 2023.

However, operating expenses surged by 28.6 per cent to N31.93bn from 24.82bn, while administrative expenses also increased by 12.4 per cent to N12.07bn from N10.74bn, further pressuring profitability.

The company suffered a setback from foreign exchange losses, which soared to N43.49bn from N4.65bn in the prior year, an 834.7 per cent increase.

Caverton’s finance costs rose to N8.81bn, reflecting a 51.3 per cent increase from N5.82bn in 2023, further deepening its loss position.

Consequently, profit before tax plummeted to N50.53bn, compared to N12.66bn in the previous year.

The company reported basic earnings per share of N15.08, a decline from N3.85 recorded in 2023, indicating worsening returns for shareholders. Loss attributable to owners of the company stood at N50.02bn, while non-controlling interest loss amounted to N505.3m.

Its total assets declined 30.9 per cent to N54.81bn from N79.32bn in 2023. Key drivers of the drop included a 36.3 per cent fall in current assets to N29.90bn from N46.94bn, mainly due to a reduction in cash and bank balances, which fell by 88.9 per cent to N2.27bn.

Non-current assets also dropped by 23.5 per cent to N24.31bn from N31.77bn, primarily due to a 100 per cent decrease in right-of-use assets and an 11.3 per cent reduction in property, plant, and equipment.

Total liabilities rose by 30.5 per cent to N104.50bn. Interest-bearing loans and borrowings climbed 45.6 per cent to N27.21bn, putting additional strain on cash flow.

Trade and other payables nearly doubled, surging 90.7 per cent to N47.35bn from N24.82bn, signalling increased obligations to suppliers and creditors.

Lease liabilities declined 45.5 per cent to N2.90bn, reflecting adjustments in lease commitments.

Caverton’s retained earnings fell into negative territory at (N58.91bn), worsening from (N8.93bn) in 2023. This resulted in a negative total equity of N49.68bn, signalling distress for shareholders.

Despite the steep losses, net cash flows from operating activities improved to N15.42bn, compared to a deficit of N3.98bn in 2023. However, cash and bank balances plummeted by N18.17bn to N2.27bn, raising liquidity concerns.

Commenting on the result, the group’s Chief Executive Officer, Bode Makanjuola, highlighted the company’s ability to navigate economic headwinds while maintaining a steady performance.

“Despite the unprecedented shifts in Nigeria’s economic landscape, the company achieved a positive operating profit exceeding N9bn, underscoring the strength and adaptability of its business model,” he said.

Makanjuola pointed out that Caverton’s two core operating sectors, where the company holds a dominant position, remain highly sensitive to macroeconomic pressures. These challenges have continued to exert upward pressure on operating costs and contributed to the erosion of value across the company’s industries.

“While the operating environment has been difficult, the results demonstrate the inherent resilience embedded in our business strategy,” Makanjuola added. “Despite the headwinds, we continue to focus on strengthening our operational efficiencies and capitalising on strategic opportunities to deliver value to our stakeholders.”

The CEO also reassured stakeholders of the company’s commitment to navigating these challenges and positioning itself for sustainable growth in the future while maintaining a strong presence in both the charter flight and marine operations sectors.

In June, The PUNCH reported that Caverton Offshore Support Group Plc had seen its loss after tax worsen by about 146.79 per cent to N12.75bn at the end of December 2023 from N5.17bn in the corresponding period.