Notore’s Operating Income Rises to N3.8bn

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By Oluchi Chibuzor

Notore Chemical Industries Plc has posted a six per cent revenue growth, showing gross revenue of N17.4 billion and operating income of N3.8 billion for the nine months ended June 30, 2020.

The company disclosed this in its unaudited third quarter 2020 financial results.

The company explained in a statement at the weekend that, “There has been good progress with the on-going Turn Around Maintenance (TAM) programme on the existing plant. Significant increases in production outputs and revenues are projected after TAM is completed at the end of December 2020 as expected.”

Giving further breakdown of its results, the company said, “The gross revenue stands at N17.42 billion, compared to N16.49 billion in third quarter 2019 (6% year-on-year growth), representing a modest increase in production output and sales, while operating income is N3.79 billion, compared
to N3.34 billion in Q3 2019 (an increase by 13% YoY) driven largely by increases in other income.

It noted that its debt service cost stood at N11.89 billion, compared to N10.45 billion in Q3 2019 (14% YoY growth), due to additional term borrowing to finance the TAM programme and the impact of Naira devaluation on foreign currency denominated loans.

It continued: “Notore’s gradual revenue growth is attributable to some improvements in Plant reliability derived from the on-going Turn-Around Maintenance (TAM) programme, which has begun to impact positively on Plant operations, resulting in some modest increases in production volumes and production on-stream days during the period.

“Operating expenses increased by 22 per cent to N16.24 billion during the period from N13.23 billion for the corresponding period of Q3 2019 due mainly to a combination of increases in production activities, Plant repair and maintenance expenses exacerbated by Naira devaluation.”

On the impact of the coronavirus (COVID-19) on its operations, the company said it has continued to weather the storm during the period and recorded impressive sales during its 2020 financial year, noting, “For the period under review, Notore sold all the urea that it produced in both domestic and international fertilizer markets.”

Notore’s Group Managing Director, Mr. Onajite Okoloko, said, “Having installed and commissioned a brand new 2,000 metric tons per day NPK Blending Plant with capacity to produce various crop specialty blends of NPK fertilizer, the company is consolidating customer loyalty by expanding its product offerings.

“The NPK Plant has now commenced commercial production and sale of bulk dry blended NPK fertilizer varieties. Additionally, the company entered into partnership with the NAIC-NPK LIMITED during the period for the blending, packaging, sale and distribution of NPK fertilizer for the year 2020 farming season under the Presidential Fertilizer Initiative (“PFI”).”