Analysts optimistic as Julius Berger beats odds with 40% revenue growth to N338.8bn

BY CHARLES ABUEDE

Analysts across the market spectrum are positively upbeat about Julius Berger Group’s performance amidst the challenges or any new or potential headwinds that may result from a combination of both ongoing supply-chain impediments arising from the COVID-19 pandemic and multiplier effects of the Russia-Ukraine conflict.

This comes after the leading Nigerian company offering holistic services covering the planning, design, engineering, construction, operation and maintenance of buildings, infrastructure and industry projects in Nigeria reported a 40 percent year on year growth in its revenue to N338.81 billion in its full-year of operation from N241.8 billion in 2020.

In its just-released financial performance for the year ended December 31, 2021, Julius Berger reported a boosted topline growth with an increase in its profit after tax (PAT) to N8.3 billion in 2021 from N1.2 billion the prior year, while the group increased its profit before taxation (PAT) from N3.9 billion in 2020 to N14.2 billion in 2021.

The company has continued to beat the odds in the face of copious challenges faced in the last financial year as regards the ongoing foreign exchange scarcity and current global supply chain constraints, both consequences of the COVID-19 pandemic and the ongoing Russia-Ukraine conflict. The favourable result includes and evidences vast improvements in terms of revenue accruals, cash flow stability and positive result for shareholders.

According to the group, “The rise in revenue underlines the strong position of Julius Berger Nigeria Plc within the construction industry and its ability to execute its projects at an excellent pace and to the satisfaction of its clients.”

It also said the net favourable effect is that 2021 was a successful business year, and the company was able to return to its 2019 growth path despite the difficulties of 2020 given the disruptions occasioned by the COVID-19 pandemic, adding that the company is well prepared for any new or potential headwinds that may result from a combination of both ongoing supply-chain impediments.

Further highlights from the consolidated audited financial statements for the year show that Julius Berger Nigeria’s operating profit rose by 81 percent to N22.67 billion. Also, the EBIT margin improved by 154 basis points resulting from positive revenue growth during the year while finance costs grew by 14 percent relative to revenue growth, just as the company’s net cash position improved by 168 percent to N41.42 billion during the review period.

As a result of the commendable financial result and positive cash status for the year ended December 31, 2021, the company’s board of directors is recommending a dividend of N2.50 per 50 kobo share, resulting in a total gross dividend pay-out of N4 billion.