Courteville Business Solutions Plc, the e-business solutions and business process outsourcing company, sustained its momentum in the first six months of the year despite a dip in the macroeconomic situation. The company posted revenues of N822.2 million for the half year ended June 30, showing an increase of 1.9 percent over last year. Impressively, the company’s cost of sales also fell to N308.2 million, a drop of 21 percent from the same period in 2014. This, however, was muted by rising operating costs, which climbed 25 percent to N248 million.
The company declared pre-tax profit of N250.6 million against N256.8 million in the first six months of last year. Profit after tax stood at N210.5 million in comparison with N215.7 million reported in the second quarter of 2014. Earnings per share came in at 5.94 kobo, off 2.3 percent from last year. Speaking on the results, the company’s Group Managing Director, Mr. Adebola Akindele, said the results writing essay services were ‘proof that Courteville’s demand environment is resilient through the business cycle.’
‘Courteville Business Solutions delivered consistent financial performance in our business process outsourcing platforms such as AutoReg, which handles registration for eight out of every tenvehicles on Nigerian roads. We also recorded over 30 percent growth on Egole, our ecommerce portal. The results were achieved in a difficult and volatile economic environment driven by the drop in oil prices, a depreciating naira, and uncertainty in the run-up to the general elections. In consequence, consumer spending dampened, and business confidence declined, while government budgets underwent deep cuts.’
Courteville recently announced that in line with its 5-year strategy (2013-18) centred on diversification, and international expansion, it had acquired Priority Loss Adjusters Limited (PLA), a market leader in motor vehicle administration and testing in Jamaica. The company will also begin operations next month in Zimbabwe, where it introduce its Insurance Policies’ Database solution in partnership with the Insurance Council of Zimbabwe. This solution is already in use in Nigeria by the Nigerian Insurance Association.
Describing the company’s winning formula, he said clients recognize Courteville’s ability to ‘help them simplify, optimize and automate their operations. This empowers them to ‘bring digital solutions faster to the market, so that they can maximize their opportunities. He gave assurances that the company would stay focused on further differentiating its‘proprietary capabilities, capturing new growth opportunities, and delivering sustainable value to our clients and our shareholders.
Akindele gave further insight into the 2015 half-year results of the company. Excerpts
What’s the context to the company’s performance over the last 6 months?
The bottom-line is that since the beginning of the year the economic environment has been very challenging in Nigeria, and indeed around the world. In Nigeria, companies faced peculiar difficulties emanating from tensions and uncertainty in the pre-election period, as well as the sharp drop in oil prices, Nigeria’s main foreign exchange earner. These drained business confidence and shrunk consumer spending.
With the inauguration of the new administration at the end of May, an uptick has been observed but its impact has not moved the needle yet. Cash flow around the economy remains very tight. As the APC-led Federal Government settles down, I expect that budgets will be freer and the trickle-down effects felt across board. Notwithstanding the turbulent conditions, the company delivered results commensurate with its performance for the same period last year.
A majority of the quoted companies are reporting a decline in earnings. Courteville’s superior execution, and disciplined resource management helped us weather the storm. My expectation for the second half of the year is for improved performance and expanded market opportunities.
With the plans of Honda and other car makers to start manufacturing cars in Nigeria, do you think they can meet demand from Nigeria’s rising middle class?
When speaking of local automobile manufacture, there are two sides to the demand equation. A lot of the debate has focused on how quickly car manufacturers establishing in Nigeria can ramp up production. What has not received adequate attention is the price appeal of brand new locally manufactured vehicles versus fairly-used imported ones.
Through the AutoReg platform, which manages motor vehicle administration in 22 of the 36 states of the federation and Federal Capital Territory, I have the most accurate and comprehensive database on car registrations in Nigeria. In the last few years, about a million new cars are added to the AutoReg database every year. I am not referring to renewals, but vehicles being captured for the first time.
If one puts Honda’s planned production of 1,000 per annum beside that figure it is a drop in the ocean. Honda’s entry is a good start and a vote of confidence in the sustainable buying power of Nigerians but it will not make a dent any time soon. For the near future, the needs of the majority of car buyers in Nigeria can only be met by imports because these manufacturers’ efforts are mere drops in the ocean.
Beyond the issue of plant capacity, another issue that must be considered is how these car makers price their output to reflect the purchasing power of the Nigerian car buyers. Their prices must match or, in fact, be lower than what it costs to bring in a fairly used vehicle into the country. The last thing the buyers want is monopolistic pricing due to any tariff disadvantages that imported cars may come against.
VANGUARD JULY 27TH 2015