Fidson Healthcare Plc has reported a strong start to 2025, with profit after tax soaring 213 percent year-on-year, driven by robust revenue growth and improved operational efficiencies.
According to its unaudited financial statements for the period ended March 31, 2025, the after-tax profit for Fidson rose to N3.25 billion in Q1, compared to N1.04 billion in the same period of last year.
The company’s statement revealed that this increase was primarily driven by a significant 85 percent surge in revenue, which climbed to N35.02 billion from N18.88 billion in the corresponding period last year.
Cost of Sales grew in line with revenue, increasing by 100 percent to N22.45 billion from N11.21 billion
Administrative expenses and selling and distribution expenses rose moderately to N3.34 billion and N2.19 billion, respectively, reflecting the company’s controlled cost environment.
Finance costs nearly doubled, rising to N1.80 billion from N882.67 million in Q1 2024, signaling higher debt servicing obligations amidst Nigeria’s high-interest-rate environment.
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Despite the increase in finance costs, Fidson’s operating profit margin expanded significantly, demonstrating the strength of its core pharmaceutical manufacturing and distribution operation.
Fidson continues to battle foreign exchange volatility, recording a N449.82 million loss from exchange rate differences. While this is an improvement compared to the N2.48 billion forex loss a year earlier, currency risks remain a persistent challenge
Rising debt levels are also a concern, with interest-bearing loans and borrowings increasing substantially during the quarter to N24.08 billion from N15.99 billion.
Total assets grew by 9.5 percent to N80.50 billion from N73.49 billion as of December 2024.
Equity strengthened by 13 percent to N26.98 billion, up from N23.73 billion.
Current assets, especially inventories and trade receivables, rose sharply, with inventories hitting N25.66 billion compared to N24.18 billion in December 2024.
However, the company’s cash position deteriorated, with cash and bank balances dropping from N4.93 billion at the end of 2024 to N1.15 billion
Net cash flow from operating activities was a negative N760.5 million, primarily due to significant increases in working capital needs.
Fidson Healthcare Plc may have delivered strong profit growth in the first quarter of 2025, but its cash flow paints a more cautious picture.
The pharmaceutical giant reported a net operating cash outflow of N760.5 million, despite posting a N3.25 billion after-tax profit.
This is attributable to heavy investments in trade receivables and inventory amounting to N10.99 billion, suggesting that the company’s revenue growth was largely credit-driven.
Inventories also expanded by N1.48 billion, locking up additional cash.
Although the company partially offset this through a N4.06 billion increase in trade and other payables, it was insufficient to fully neutralise the cash drain.
Cash and cash equivalents swung from N3.65 billion at the beginning of 2025 to a negative N2.40 billion by the end of March.
This implies that Fidson is now relying on bank overdrafts and short-term funding to meet immediate obligations.
