Veritas Kapital Assurance Plc: Huge profit declined

By Philemon Adedeji

INTRODUCTION

Unaudited results for the first quarter ended 31, March 2022, of Veritas kapital Assurance plc was not showing any impression in its profit position recorded. Rather, it recorded higher profit in 2021, while in 2022 the profit declined marginally by 68 per cent.

For the first quarter unaudited results in 2022, all profitability ratios were dropped than the previous years and these include profit margin, return on assets, return on equity, profit after tax, per employee and operating margin.

GROWTH INDICES

Unaudited results for the first quarter 2022 released, reveals that the company recorded a 22.7 per cent decline rate in its turnover (This indicated that the sales figure depreciated instead to grow from 2021 to 2022). Such turnover depreciated marginally to N1.863 billion dropped from N1.44 billion in the preceding year.

At a glance 22.7 per cent decrease in the company’s ability to moved higher was worse than the growth rate achieved in the corresponding period and also was not good when comparing with the industry average for the same period under review.

Profit before tax growth rate followed towards the same position, as the company yet recorded a lower profit in 2022 than it recorded in 2021. Profit before tax for year stood at N126 million in the preceding year worse than a profit of N394 million in the previous year and thereby translating into a decline of 68 per cent rate.

This 68 per cent decline rate is as compared to another decline rate in the preceding year.

The only area of top line performance in the unaudited financial results for the first quarter ended March 31, 2022 recorded was fee and commission income which rose to N179.5 million from N41.8 million in the corresponding period of 2020, this representing a 330 per cent increased.

Vertas kapital Assurance deployed Total assets for 2022 unaudited results for the first quarter grew just a bit by N16.960 billion, representing an increase of 3.36 per cent more than the N16.408 billion assets deployed in 2021, while shareholder fund stood at N11.311 billion in 2022, 16.4 per cent more than the N9.717 billion recorded in the corresponding year.

PROFITABILITY RATIO

Profitability ratio for the 2022 unaudited financial results released was not showing impressive performance, Veritas Kapital Assurance plc, as all the parameters were dropped below the preceding year.

To firstly achieve a decline the profit margin of the company standing at 12 per cent in 2022 as compared to 29 per cent in 2021. What this mean for every N100 earned by the company in the course of the year, N12 of it translated into profit.

Also, to record a regression was return on assets (ROA) standing at 1 per cent in 2022, as compared to 3.2 per cent in 2021.