Investors who have held John Holt shares in the last few months, have cause to smile as the stock has rallied. From a fundamental perspective, there has also been some improvement. At the core though, cash is king, and there lies an empty throne with this firm.

About the company 

In 1897, John Holt established his first venture in Lagos. Up to the Second World War, John Holt was involved mainly in the distribution and export of produce.

A fleet of ships operated fortnightly service from Liverpool to West Africa. John Holt & Company (Liverpool) Limited was incorporated in the United Kingdom. 

The firm  was incorporated in Nigeria as John Holt Limited in 1961. It became  a public company and was quoted on the Nigerian Stock Exchange in May, 1974.

The Company has business units in Engineering, Air Conditioning & Cooling systems, Fire & Safety equipment, Construction, Property development, Boat Building and has effectively developed its in-house brands called Holtstar and Holt Premier.

JOHN HOLT & COMPANY(LIVERPOOL) LIMITED is the majority shareholder with 200,244,245 shares amounting to a 51.46% stake.  

Recent rally 

In the last few weeks, the stock’s price has been on a tear. Last week, the stock gained 60.50%. Year to date, the stock is up 265.95%, outperforming the All Share Index which is up by over 30%. 

Recent financials 

Unaudited Q4 results for the period ended September 2024 (which is when its financial year ends) show the firm increased revenue by 82% from N1.8 billion in 2023 to N3.3 billion in 2024.

87.8% of its revenue comes from technical products and leasing services. It made N2.9 billion from that during the period. 

It recorded a profit after tax of N2.3 billion as against a N1 billion loss recorded in the prior year. 

If you strip away the other operating income of N3.1 billion recorded during the period, the company very likely would have recorded a loss. The financial statements do not provide details as to the source of this other income. Neither do previous quarters.

Very little cash 

Cash flow statements for the period show the firm had N39 million in cash. That’s a sharp dip from the N1 billion it had in the same period last year. Chances of a dividend payment are quite slim.

Little upside left

At its current share price, the stock is trading at less than 2 times earnings (FY 24 earnings was N6.14 Current share price is N8.49. Chances of a further upside are limited since the stock had done over 200% year to date (January 2024 till date)