Skyway Aviation Handling suffers 25% decline in profit over hike in finance cost

Skyway Aviation Handling Company (SAHCO) Plc has reported 25 per cent drop in profit after tax to N310.23million in half year (H1) unaudited financial statement period ended June 30, 2022 from N411.78million reported in half year (H1) unaudited financial ended June 30, 2021.

The airport and aviation service providing company also suffered 12.7per cent drop in profit before tax to N507.4million in H1 2022 from N580.95million reported in H1 2021.

Contributing factor to SAHCO’s poor performance in H1 2022 can be linked to 242.5 per cent increase in finance cost to N52.69million from N15.34million reported in H1 2021.

The company’s foreign exchange loss of about N52.69million compounded its finance charges woes in the period under review.

Other contributing factors include 46 per cent increase in cost of sales to N3.34billion in H1 2022 from N2.28billion in H1 2021, while administrative expenses grew by 29.6 per cent to N1.82billion in H1 2022 from N1.4billion in H1 2021.

SAHCO also reported 36.6 per cent increase in revenue to N5.68billion in H1 2022 from N4.15billion in H1 2021, driven by foreign and domestic handling of major service lines.

Foreign handling business line grew by 92 per cent to N1.16billion in H1 2022 from N605.49million in H1 2021, while domestic handling rose significantly by 245 per cent to N1.13billion from N326.7million reported in H1 2021.

Foreign and domestic handling income are from aircraft handling raised for Ramp Services, passenger profiling, security and baggage handling (Loading and offloading).

The challenges for the company reflect the difficulties facing the business sector, which has cut down business travels as well as security challenges that have held back tourists.

This year therefore looks like one of the worst performances for the company going by the H1 2022 performance. 

The stock price of SAHCO traded flat at N6.85kobo per share as of July 26, 2022.