NGX sanctions Notore Chemical Industries as company battles to stay afloat
According to THE WITNESS, Notore Chemical Industries and 12 other businesses have received sanctions from the Nigerian Exchange Limited (NGX) for allegedly breaking the law and failing to submit their financial accounts by the deadline.
Notore and other companies received sanctions for the current financial year 2022 for failing to comply with the regulatory requirements covering the third quarter (Q3) of 2021, the full year (FY), and Q1 2022, according to the Exchange’s X-compliance report that THE WITNESS obtained.
The penalty is being imposed as Notore’s investors worry about its capacity to remain a continuing concern.
Notore is a fertiliser and agricultural-related enterprise in Nigeria that is owned by Mr. Onajite Okoloko, a billionaire from Delta. The group’s current businesses include producing fertilizer, supplying fertilizer, and trading fertilizer.
By publishing compliance-related data on all listed companies, NGX Regulation Limited (NGX RegCotransparency )’s program known as the X-Compliance Report aims to protect investors and uphold market integrity.
Companies listed on the NGX are required by listing regulations to submit annual and quarterly financial reports 30 days following the end of each quarter. Companies who violate this law are typically labeled MRF (Missed Regulatory Filing), and the omission frequently results in financial penalties.
… Notore Battles To Stay Afloat
The Notore Chemical Industries’ recent financial records, which THE WITNESS got from the NGX, show that the company is really in danger and in distress.
This is due to the fact that the Notore’s investors are still nursing their wounds from the appalling performance the firm had in 2021, when it registered a N3.27 billion post-tax loss. The agricultural-related business reported a loss of N2.88 billion in September 2020.
The company’s financial statement for the 15 months that ended in December 2021 (since it did not release its fourth quarter results in 2020) revealed that even though its revenue increased by 36.74% to N25.71 billion at the end of the previous financial year, it was offset by N28.98 billion in costs, which were 33.66% higher than the N21.68 billion it spent in September 2020, to generate this income.
Consequently, it lost N3.27 in 2021 as opposed to N2.88 billion the year before.
The Port Harcourt-based company’s operating income decreased by 19.47% to N9.96 billion at the end of 2021, while administrative costs increased by 17.10% to N6.94 billion and other income decreased by 8.29% to N17.13 billion. In spite of spending 12.89% more than the N23.41 billion in finance costs it reported in 2020, it saw a huge decline in finance income of 63.87% to N388,000.00.
In 2021, loss per share was N5.94 as opposed to N3.97 in the year prior.
The company struggled with a liquidity crunch last year since its current total assets, which were N18.96 billion, were significantly less than its current obligations, which were N101.15 billion. As a result, it found it difficult to pay its debts during this time.
This issue lasted throughout the first half of 2022r as the company’s current liabilities still outweighed its current assets by a wide margin. Total liabilities were N70.53 billion in the first half of 2022, compared to total current assets of N19.55 billion.
However, Notore appears to be gaining ground as it reported a N2.61 billion post-tax profit in the first half of 2022 as opposed to the N15.85 billion loss it reported in the same time the previous year.
With income from urea and other chemicals rising by 311.07% to N24.97 billion from N6.07 billion in H1 2020, it had an enormous increase in revenue, which increased by 178.61% to N26.29 billion from N9.43 billion.
Operating income for Notore increased to N10.85 billion in 2022 from a loss of N3.03 billion the year before, supported by administrative and selling and distribution costs that decreased by 21.54% to N3.44 billion and 34.01% to N111.58 million in H1 2022, respectively.
Financial analysts are nonetheless concerned if the corporation can maintain the trend by the conclusion of the fiscal year, despite the modest gains in H1 2022.