The shares of UACN Property Development Company Plc (UPDC) has fallen by 10 percent from its 7 day high price of N15.10, following the company’s announcement on low earnings expected for the 2016 financial year.
UPDC had written to investors through the Nigerian Stock Exchange on Thursday the 16th February, stating that the company is expected to report low earnings for the 2016 financial year.
The company explained that after it had carried out a preliminary review, of the company’s Management Accounts for the year ended 31st December, 2016 , it expects to report materially lower earnings, mainly as a result of the recognition of losses on certain projects and impairment of investments in one joint venture project occasioned by significant increase in finance costs.
“The results were further worsened by foreign exchange losses and the negative performance of our hotel asset.” the company said
UPDC also noted that further details of the financial performance will be disclosed in the audited financial statements, but assured investors that despite the continued lull in the real estate sector occasioned by the headwinds of the macro-economic environment, the fundamentals of the business remain strong.
“We are restructuring and repositioning the company to better deal with the challenges of the times and explore emerging opportunities” the company said
In the first nine months of 2016, UACN Property Development Company Plc (UPDC) reported a revenue of N3.2 billion, down 28 percent from N4.1 billion in September 2015.
Gross profit stood at N904.5 million, up 8 percent from N841.1 million in September 2015 as Other operating income fell to N217.1 from previous year’s N493.4 million.
The company however recorded a Profit Before Tax of N133 million for the nine month period ended 30th September 2016, as against a loss of N109.8 million.
Profit After Tax for the review period stood at N23.8 million, as against a loss of N109.8 million recorded in the corresponding period of 2015