Strong Earnings put Vitafoam’s Shares on High Demand

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Strong Earnings put Vitafoam’s Shares on High Demand

Impressive corporate earnings and expectation of high return on investment have put shares of Vitafoam Nigeria Plc on the league of the most sought after by discerning investors on The Nigerian Stock Exchange as they scramble to beef up their portfolio with the stock despite the bearish trend.

Vitafoam’s impressive performance in the third quarter which ended on September 30, 2018  indicated that the its net profit stood at N601,923 million from a loss of N127, 690 in the preceding year while its basic Earnings Per Share (EPS)  hit N57 kobo in the review period as against a loss of N15 kobo in the preceding year.

As a reward for its numerous shareholders, the company announced a dividend of 25 kobo per share. This is in addition to declaration of bonus share of one for five ordinary shares.

The announcement of Vitafoam’s strong earnings prompted many investors to place buy order on the stock to take advantage of its current low price relative to the company’s intrinsic value on stock market.

On Monday, December 31st, 2018, the last trading day for the year, Vitafoam led the gainers’ chart on The Exchange, followed by Stambic IBTC  as Vitafoam’s share price appreciated by 10 percent,  from N4  to N4. 40, following transaction of 2, 687,190 shares, worth N11,823, 096 on the company’s shares.

Market watchers were quick to commend the company’s performance, saying demand for its shares may continue despite the general lull  in the market.

Network Capital’s Managing Director and Chief Executive Officer, Mr Oluropo Dada, promptly ascribed the rally created by Vitafoam’s result to the associated value for both existing and potential shareholders:

“The Stock market is information – driven. It responds to every information from quoted companies, regardless of the type of information. This is the beauty of the market in aggregating investors’ reaction to every bit of information or market hearsay. The 25k dividend and one for five bonus is the fundamental factor driving Vitafoam’s share price. This is real. Everyone knows that the company’s current performance is far better than that of last year.”, Dada said.

Vitafoam’s Group Managing Director and Chief Executive Officer, Vitafoam Nigeria Plc, Mr Taiwo Adeniyi attributed the company’s recent opportunity performance to a range of factors including access to finance and availability of raw materials and putting customers at the center of all the company’s activities among others.

“ We are enjoying Improved funding through Bank of Industry’s (BOI’s) intervention, deliberate cost management, improved efficiency, customer centric approach to selling, innnovative thinking, market differentiation, Government’s deliberate policy on forex trading and availability which has helped in sourcing of input materials at cheaper rates and also planning”, Adeniyi said.

As part of its Corporate Social Responsibility (CSR), annually, Vitafoam donates its products to Lagos Island Marternity Hospital to ensue availability of good equipment and identify with the Baby of the year. Speaking at this year’s edition in Lagos, Adeniyi said it was consistent with the company’s CSR policy as its products cut across diverse age groups and status.

“Vitafoam has been known over the years for good quality products. It believes in being part of the child’s life from cradle. We have always been known to provide for the home, every age set you find in the home. We have products that meets the needs of the baby up to when it becomes a toddler and then, when he eventually grows up to become an adult.

“ We believe that if we are part of the child’s life from cradle, there is every chance that the child will use Vitafoam’s products as he grows up. The child will recommend Vitafoam to others, then, it continues from one generation to another. We are part of the child’s life from the day the child is born, that is our motivations,” Adeniyi said.

The company’s Chairman, Dr Bamidele Makanjuola has always affirmed that Vitafoam thrives on innovation, team work among the staff and adherence to the highest standard of corporate governance at both the board and management level. Vitafoam Nigeria Plc is a foremost manufacturer of flexible, reconstituted and rigid foams with subsidiaries that specialize in various products. The company places premium on Research and Development (R and D), quality products and services. Besides, it Invests in capacity building in order to sustain its culture of creativity among the staff.

The company’s subsidiaries are Vitafoam Ghana Limited, Vitafoam Sierra Leone Limited, Vitapur Nigeria Limited, Vitablom Nigeria Limited , Vitavisco Nigeria Limited, Vono Furnitures Products Limited,  Vitagreen Nigeria Limited and Vitaparts Nigeria Limited.

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