Cutix Plc has posted its first annual loss in years after surging borrowing costs erased operating gains, underscoring the pressure Nigeria’s high-interest-rate environment continues to exert on manufacturers.
The electrical cables manufacturer reported a loss before tax of N47.9 million for the financial year ended April 30, 2026, a sharp reversal from the N1.62 billion profit recorded a year earlier. Profit after tax also swung to a loss of N47.9 million from N1.13 billion in the preceding year.
The unaudited group financial statements filed with the Nigerian Exchange Group (NGX) show that revenue declined 6.4 percent to N14.77 billion from N15.77 billion, weighed down primarily by lower cables and wire sales, which fell to N9.91 billion from N11.81 billion.
Armoured cable sales also contracted to N2.63 billion from N3.90 billion. Partly cushioning the decline was a notable jump in metal product sales, from N54.2 million to N1.81 billion, suggesting a deliberate push to diversify the product mix.
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Gross profit fell marginally to N2.90 billion from N3.02 billion, but gross margin improved to 19.6 percent from 19.2 percent, indicating better cost management amid challenging operating conditions.
However, finance costs emerged as the biggest drag on profitability.
Finance expenses surged to N1.04 billion, nearly tripling from N383.2 million in the previous year, driven almost entirely by interest on commercial papers. which soared to N814.7 million from N140.4 million. The company issued commercial papers to individuals and cooperative societies for 90-day periods at rates ranging from 8 percent to 26 percent, and the outstanding balance on these instruments stood at N2.27 billion at the end of the period, up from N704.3 million.
The increase more than offset the operating profit of N930.3 million, pushing the company into the red.
The results reflect the growing burden of borrowing costs on Nigerian manufacturers following aggressive monetary tightening by the Central Bank of Nigeria, which has driven lending rates to multi-year highs.
Cutix’s short-term borrowings rose to N2.77 billion from N2.11 billion a year earlier, suggesting greater reliance on working capital financing to support operations and inventory requirements. Total liabilities increased by 4 percent to N3.95 billion.
The deterioration in earnings also weakened shareholder value. Total equity fell by 28 percent to N3.52 billion from N4.90 billion, while retained earnings turned negative at N25.98 million compared with a positive balance of N1.37 billion a year earlier
Despite the headwinds, management pressed ahead with a significant capital investment cycle. Capital expenditure rose 6 percent to N1.50 billion, with the bulk, N1.38 billion, channelled into plant, machinery and equipment, pushing the gross carrying value of that asset class to N2.69 billion.
An inventory loss of N277.5 million, not present in the prior year, added further pressure to administrative expenses, which rose to N1.51 billion from N1.24 billion.
Headcount fell to 276 from 302 as of April 30, 2025, with reductions across all cadres—managerial, intermediate, and junior staff. Staff costs nonetheless rose to N931.1 million from N887.6 million.
Cutix closed its last trading day on Friday, May 29, 2026, at N3.10 per share on the NGX, recording a 0.6 percent drop from its previous closing price of N3.12.
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The company is currently the 93rd most valuable stock on the NGX with a market capitalisation of NGN 21.8 billion, which is about 0.014% of the Nigerian Stock Exchange equity market.
The board declared no dividend for the current period, compared to the 10 kobo per share paid from prior-year earnings.