Wema Bank has successfully concluded the first tranche of its recapitalisation exercise having secured all relevant regulatory approvals for the allotment of its N40bn Rights Issue which was initiated in December 2023.
It may be recalled that the Central Bank of Nigeria (CBN) in March 2024, launched a recapitalisation programme requiring commercial banks to raise fresh capital in alignment with the minimum requirement for their respective banking licenses, within a 24-month timeline spanning April 1, 2024, to March 31, 2026.
The goal of this recapitalisation programme is to simultaneously boost the Nigerian economy and strengthen the financial services industry.
Consequently, Wema Bank in December 2023 launched a N40bn Rights issue which has now been approved by the CBN and the Securities and Exchange Commission (SEC).
In a statement made to the public by the Bank, Moruf Oseni, Wema Bank’s Managing Director and CEO, reiterated the Bank’s resolve in retaining its Commercial Banking license with National Authorisation, adding that the N40bn Rights Issue is a step in that direction.
“We are delighted to announce the conclusion of the 1st tranche of our Capital Raise Programme, after obtaining the relevant approvals of all regulatory authorities. Our move to commence our Capital Raise Programme very early demonstrates our push for excellence and with a strong emphasis on our digital play, we are set to amass more successes in the coming months.
“We were impressed by the vote of confidence given by our shareholders during the 1st Rights Issue exercise as our shares were fully subscribed. In addition, we obtained the approval of shareholders at our 2023 Annual General Meeting (AGM) to raise an additional N150billion to meet the capitalisation threshold set by the CBN.
“The process is expected to be completed within 12-18 months. We are committed to providing optimum returns for every stakeholder and the successful conclusion of this N40bn Rights Issue is a bold step in the right direction.”
In addition to the upward trend in the Bank’s financial performance and the success recorded so far in its recapitalisation exercise, Wema Bank’s corporate rating was recently upgraded to BBB+ by Pan African credit rating agency, Agusto and Co, and retained at BBB by international rating agency, Fitch.
Over the medium to long term, Wema Bank is positioned to not only dominate the digital Banking space but also the Nigerian financial services industry at large as it translates its industry leadership to significant market share.
Wema Bank is a leading financial services entity with banking operations across Nigeria, its leadership position in the digital banking space speaks to its aspirations to liberate Nigerian businesses and entrepreneurs by making digital platforms widely available.
The African Regional Organisation of the International Trade Union Confederation (ITUC-Africa) has called on African governments to strengthen legislative frameworks, improve enforcement mechanisms and invest in education and social services as a matter of concerted efforts to end child labour.
The regional trade union centre urged all stakeholders to take tangible actions to protect the rights and dignity of every child.
The union said this in a statement signed by the General Secretary, ITUC-AFRICA, Comrade Akhator Odigie to commemorate this year’s World Day Against Child Labour, tagged: “Let’s act on our commitments: End Child Labour!”
The union said it was sacrosanct that world leaders, especially African governments heed the “urgent and clarion call for immediate action to be taken to end the menace.
It noted that Africa has the world’s highest incidence rates of child labour.
The union added that it was a worrisome situation that reflected negatively and regularly in the annual report of the International Labour Organisation (ILO) Committee of Experts on the Application of Conventions and Recommendations (CEACR).
The statement read: “In the past ten years, the Committee on the Application of Standards (CAS), a standing committee of the International Labour Conference (ILC), has discussed at least one African country on the issue of endemic child labour.
“The African region has also been among those most affected by situations of state fragility and crisis, which in turn heightens the risk of child labour. Worldwide, the agriculture sector accounts for the largest share of child labour. In Africa, agriculture accounts for 85 per cent of all child labour and 61.4 million children in absolute terms. Many African children toil in private homes as servants, in farming, construction sites, mines, garages, shops and other enterprises in the informal sector. Some work and live in slave-like conditions, while others are forced into prostitution or end up in the streets of cities far away from their houses. Children are faced with severe threats to their health and safety, as they are exposed to biological, chemical and environmental hazards that often result in physical injury and illness.
“According to the UN children’s agency UNICEF, population growth, recurring crises, extreme poverty, COVID-19, and inadequate social protection measures have led to an additional 17 million girls and boys engaging in child labour in sub-Saharan Africa over the past four years.
“These children are deprived of their fundamental rights to education, health, and a childhood free from exploitation. As we commemorate this day, we call on all remaining member states to ratify ILO Convention No. 138, which sets the minimum age for admission to employment or work. It is imperative that all stakeholders, including governments, employers, trade unions, and civil society, effectively redouble their efforts to implement, apply and enforce the provisions of both ILO Conventions No. 182 (Worst Forms of Child Labour) and No. 138 (Minimum Age).
“ITUC-Africa reaffirms its unwavering commitment to combating child labour in all its forms. We recognise that ending child labour requires a multi-faceted approach, encompassing legislative action, robust enforcement, social protection, quality education, and the promotion of decent work for adults. It is only by addressing the root causes of child labour, such as poverty and lack of access to education, that we can create a sustainable future free from child exploitation and abuse.
The trade exhibition expo of the African Organisation for Standardisation (ARSO) will officially open on Monday, in the Federal Capital Territory, Abuja, with participants expected from across the continent and other regions of the globe.
According to a statement issued on behalf of the ARSO secretariat, the week-long event which coincides with the ARSO’s 30th General Assembly will attract several participants from Nigeria and beyond, including manufacturers, producers and vendors across the key commanding heights of the economy within and across the continent.
Already, top tier manufacturers like the Dangote Group, Innoson Motors, AIG Rite Foods Limited, Nasco Foods, Ajinomoto, and others in the fast moving consumer goods segments, allied sectors, and small businesses have keyed into the programme.
Besides, it will offer a firsthand experience of the vibrant Nigerian market, with an array of local manufacturers and producers slated to participate.
According to her, the exhibition promises to be a catalyst for economic growth, both for domestic stakeholders and international visitors.
In real estate Water Fronts are usually the toast of the rich and so when in 2010 the Lagos State Government advertised its Oko-Orisan Waterfront Residential Land Scheme, many Diasporans, the wealthy and elites bought into it.
Many were said to have been excited, not only because they wanted a home in Lagos, but also the safety of dealing with the government directly to safe guard their investment by avoiding middle men and dubious Developers they are currently hunted by nightmares as their faith in the State Government has been shaken except something is done urgently.
Subscribers to the Oko-Orisan waterfront scheme are feeling victims of what they now realise as an imperfect land administration system in Lagos State. They have become distraught from the frustration brought on them by the government (LASG) which they didn’t expect.
In view of their disappointment and frustrations, in the hands of the Lagos State government officials, a number of those that had invested in the land purchase scheme including Mr. Hakeem Ibrahim have recently formed a group (Oko-Orisan Waterfront Scheme Subscribers Group), for the purpose of engaging with the state government.
In an interview with The Nation Ibrahim said: “In 2012, I purchased a piece of land in the Lagos State Government Oko-Orisan Waterfront Scheme in the Lekki area of Lagos State while others bought into the scheme as far back as 2010. The fee I paid for the plot was N3.8 million only, though I was receipted for only N3.3 million, out of the amount I paid. We were all issued original copies of allocation letters and official receipts from the Lands Bureau of the office of the Governor. My personal allocation letter was dated May 12, 2012. As a result of the delay we severally visited the appropriate offices of the government to inquire on the progress and were on each visit assured that our documentations are genuine and valid.
“The challenge today, is since our consummation of the contract with the Lagos government, we are yet to be physically allotted our plots in the scheme. The official reason the government officials have given for this is that since around 2013, the scheme had been suspended to allow for redesigning. But we learnt from an unofficial quarters that there are attempts by government to abandon the scheme and re-allocate the plots to wealthy and influential members in the society while moving the initial allottees to yet to be determined obscure location.”
On what else the Group has done to recover their land, Ibrahim responded that they have expressed their disaffection in writing to the Office of the Special Adviser on Housing, who minuted it to the Bureau’s Legal Department who advised them to see the Executive Secretary, Lands and/or Permanent Secretary, Lands to convey their dissatisfaction in person.
He also added that the hope of the group was further diminished when in response to the inquiry about their plots of land, the Lands Bureau informed them that the Orisan scheme was being redesigned and re-modelled, promising to inform the allottees of the outcome when completed, without as much as suggesting a timeline for when that would happen.
In what can be described as brand acceptability, Seaman Schnapps, one of the famous prayer drink from Grand Oak Limited, first class monarchs at the palaces of Ayangburen Ikorodu and Ebumawe Ago-Iwoye recently gave the brand royal endorsements.
During a visit led by Marketing Manager Mr. Gbemileke Lawal and Senior Brand Manager Mrs. Nnenna Uche-Onyenacho, the Seaman Schnapps team received a warm welcome from the monarchs.
At the palace of Ayangburen Ikorodu, His Royal Majesty, Oba (Engr.) Kabir Adewale Shotobi who presided over the discussions centered on the significance of cultural heritage and unity commended Seaman Schnapps for its firm dedication to upholding these values and expressed blessings for the prosperity and well-being of Lagos and Nigeria.
Similarly, the visit to the palace of Ebumawe Ago-Iwoye, under the leadership of His Royal Majesty Oba Abdul-Razaq Adesina Adenugba, was met with warm hospitality and profound appreciation.
Oba Adenugba praised Seaman Schnapps for its commitment to preserving Nigeria’s cultural heritage and fostering unity across communities. Together, they exchanged insights on the pivotal role of traditional institutions in promoting peace and prosperity in the country.
An elated Lawal described the visits as a tremendous blessing. “Seaman Schnapps was honoured to have had the opportunity to join Ayangburen Ikorodu and Ebumawe Ago-Iwoye in unlocking royal blessings. Our visit reaffirms our commitment to upholding traditional values and fostering unity in Nigeria. We eagerly anticipate continuing our partnership with these esteemed monarchs for the betterment of our communities.”
Echoing similar sentiments, Uche-Onyenacho expressed sincere appreciation on behalf of Grand Oak Limited, even as she reiterated Seaman Schnapps’ unwavering commitment to promoting cultural heritage and fostering unity.
The visit to the palaces of Ayangburen Ikorodu and Ebumawe Ago-Iwoye marks another significant milestone in Seaman Schnapps’ journey to celebrate and honour Nigeria’s rich cultural heritage. As the nation’s original No. 1 prayer drink, Seaman Schnapps remains steadfast in promoting unity and prosperity for all.
Indications are that the Nigeria Social Insurance Trust Fund (NSITF) is now high on performance and productivity in its quest to promote sustainability at the workplace by addressing the legion of challenges associated with the Employees Compensation Scheme (ECS), reports Ibrahim Apekhade Yusuf
From available information, the Fund is now living to its billing as a pro-worker organisation offering succour where and when necessary.
Investigation by The Nation revealed that between March 2023 and May 2024, a total of 20,531 workers benefited from different compensation packages, like disability payment, medical expenses refund, loss of productivity and death benefits respectively.
For instance, Salami Olayinka, Jubril Ismaila, Umoru Bala, Lamidi Oluwatobi Ismaila, Abdullahi Jamilu Garba, Godwin Lawrence, Abdul Rahman Siddik, were all employees at a construction and food companies, got disability benefits after suffering bodily harm.
Others like Samuel Sunday of Vono Furniture Products Ltd, Shedrack Ali of WoodStyles Limited, Olusesi Olalekan of Workmen & Talents Agency Ltd, Davison Aigbekaen of Xerox H.S Nigeria Ltd, Itafor Emmanuel of Vision Job 24 7 Nig Ltd,
Ekeugo Obinna of Vik Industries Ltd, Sylvester Markson of Veto Tech Company Limited, all got loss of productivity payment, just as Zakka Yusuf of A. G Ferrero and Company Limited, Wogu Ihechi Peace of Abia State College Of Health Science & Management Technology, Ugwuoke Chinedu Keneth of Abumet Nig Ltd, Momoh Victor O of Access Bank Plc, Ndifereke Monday Akpan of Ace Foot Wear Manufacturing Company Limited, Idris Abdulhamid of Adama Beverages, Giscard Stanley Norris of Adamawa Home And Savings Limited, Yisau Abayomi of Adayira Haulage Ltd, Abuh Inalegwu Of Africa Still Mills Nigeria Limited enjoyed medical expenses refund.
Among those who earned death benefits on behalf of their deceased families include dependents of Osunbade David of British American Tobacco, Bala Obadiah of 4u Supermarket Ltd, Sindama Julius of A & P Foods Ltd, Maurison Ezesinachi Caleb of ABC Transport, Augustine Akowe of Abuja Steel Mills Ltd, Abubakar Dauda of Abuja Urban Mass Transport, Nyerhovwo Tonukari of Academic Journals Limited to mention just a few.
How did the NSITF, which hitherto had suffered bashing from all quarters due to what was largely perceived as their predilection to negligence and anti-worker welfare, one may be tempted to ask?
One person who should know better offers a plausible explanation.
Barr. Maureen Allagoa, the Managing Director of the NSIFT during an interactive session said the modest success achieved by the Fund so far is all thanks to the renewed commitment of the entire team.
According to her, the Fund has achieved a milestone in the discharge of its statutory mandate of providing adequate compensation and rehabilitation to Nigerian workers and their registered beneficiaries who have sustained injuries, occupational diseases, disabilities or died in the course of work.
Although the Nigeria Social Insurance Trust Fund (NSITF) metamorphosed from the National Provident Fund (established in 1961), to a Trust Fund (in 1993, by decree No.37) and to a Social Insurance Trust Fund (Avia the enactment of the Employees’ Compensation Act (ECA) by the National Assembly, on December 17, 2010), the provision for workplace safety net and social security for workers has been a core mandate of the agency.
First, the signing of the Employees’ Compensation Act (ECA) into law by the National Assembly brought fundamental restructuring to the fund.
The Act mandates the NSITF to provide adequate compensation and rehabilitation to all employees and their registered beneficiaries in case of injuries, death, occupational diseases or disabilities that occur in the workplace or in the course of work.
The ECA further empowers the NSITF to maintain a solvent compensation fund for employees and employers and charged it to establish an efficient procedure for the enforcement of occupational safety and health standards to prevent workplace accidents. And in 2014, the amended Pension Reform Act of 2014 further directed the NSITF, in Section 84(2), to provide social security services to all eligible Nigerians.
Allagoa noted that the Fund, between July 2011, when the ECA came into operation and 2024, has registered over 145,000 employers and 7.4 million employees into the scheme, paid claims and compensation to over 103,000 beneficiaries, including 111 persons who received artificial limbs (prosthetics) and 11 beneficiaries who were sent abroad for further medical treatment.
Equally, she said the Fund has spent about N6.6 billion within the period and has taken occupational safety and health (OSH) training to workers in over 25,000 registered companies.
In addition, the Fund’s many successes in recent years, Allagoa said: “We are embarking on an expansion policy, adopting the branch-in-branch strategy with Lagos region as a pilot while also creating service delivery centres across the country to further bring our services to all Nigerians using Bonny Service Delivery Centre as a pilot.
“We will expand our operations and coverage into the informal sector and other unreached areas in dire need of social security services. In addition to reaching more clients, this will reduce commuting distance for staff on compliance drive.”
On challenges, the fund noted that defaulting in the payment of the mandatory one percent contribution for ECS comes top, among others. In a recent presentation in Abuja, the fund added that government MDAs are chief culprits in this regard.
The Fund stated: “There are challenges which have encumbered the fulfillment of our mandate among which is the implementation of the deduction of 40 percent of the employers’ contribution to the fund by the Ministry of Finance as an operating surplus under the premise of the implementation of the Fiscal Responsibility Act.
“N1.4bn was deducted in 2022 and paid into the Consolidated Revenue Fund (CRF) in line with the Finance Act 2020. This is notwithstanding the fact that the NSITF is not a revenue generating agency but a tripartite structure holding funds in trust for the benefit of employees under the ECS and has no operating surplus.
“The NSITF is not treasury-funded and does not draw from the Consolidated Revenue Fund of the federation. Also, ECA 2010 does not cover some areas of claims and compensation in the informal sector and these gaps in the law have variously been exploited by dubious employers to the detriment of employees. Amendment to the Act is therefore needed.
“Another hurdle is implementation of the recent FEC approval and subsequent issuance of a circular by the Office of the Secretary to the Government of the Federation for the deduction at source of the one percent ECS contributions for all workers in the public service of the federation and the retrieval of backlog from 2012 to date.
“Though the implementation of the ECS in all MDAs has received support from relevant quarters of authority, it further needs concerted efforts to ensure that contribution will begin this year. The fund needs the assistance of the Attorney General of the Federation for a fiat to prosecute some listed defaulting and recalcitrant employers as well as facilitate the gazetting of all the lawyers working with the fund to enable them appear on behalf of the NSITF in court for the recovery of outstanding monies due to the fund.
“Going forward, the NSITF needs the support of the tripartite stakeholders to build ECS into a world class social security institution capable of triggering social change and poverty reduction in Nigeria.”
“To this end, the NSITF obviously needs all the help it can get, especially from the Minister of Labour and Employment, to interface with the Ministers of Finance and that of Budget and National Planning to facilitate the payment of the ECS contribution arrears of 2012 to 2023 which runs into billions, to interface with the National Assembly for the amendment of the ECA 2010. Also, to interface with the Minister of Finance and the Accountant General of the Federation to remove NSITF from the schedule of the Fiscal responsibility Act for the deduction of 40 percent of contributions received from the private sector. Over N1.4 billion was deducted from our account in 2022 and much more may be deducted this year save for your intervention.”
Also, NSITF, as part of its efforts to spread the coverage of the Employees Compensation Scheme (ECS) across the country, expanded its branches to 56 across 12 regions in the country.
The Fund equally has two subsidiaries: a Trust Fund Pension and Pro-Health HMO. The Trust Fund manages retirement savings and pensions, while the Pro-Health HMO, a public-private-driven enterprise, provides healthcare insurance services to registered workers. It also has developed an operational plan with 50 objectives to boost ECS in line with the eight-point agenda of President Bola Tinubu’s administration in the areas of poverty alleviation and economic growth.
Meanwhile, through the efforts of the current management of the fund, the Secretary to the Government of the Federation, Senator George Akume, revealed that he has, in a circular dated September 22, 2023, directed all the Federal Government’s ministries, departments and agencies (MDAs) to commence the mandatory contributions of one percent of the emoluments of all public servants to the Employees’ Compensation Scheme of the NSITF. This is following the decision of the Extraordinary Session of the Federal Executive Council under President Buhari, which had on Monday, May 15, 2023, given the approval for the statutory one percent deduction.
In the circular, the Minister of Finance is directed to “deduct the contributions from source and remit same to the NSITF for the payment of claims and compensations to deserving beneficiaries for death, injury, disease or disability sustained in the course of duty as provided in the Employees’ Compensation Act, 2010, Act No. 13.” It further directed all MDAs to “ensure strict compliance with the circular.”
Furthermore, management made further inroads recently by getting the nod of many Federal Government-owned institutions, state governments and private sector organisations and institutions that now implement ECS and Occupational Safety and Health (OSH). Notable among the states are Akwa Ibom, Kano, Lagos, Plateau, Abia, Rivers, Sokoto, Delta, and especially Bauchi, Oyo and Yobe which have enrolled. The management has also relaxed the time frame for capturing an accident victim to a reasonable period of time.
Moreover, the fund has, in the past one year, conducted 5,592 Occupational Safety and Health exercises in different workplaces across the country.
Echoing similar sentiments, the General Manager, Corporate Affairs of the Fund, Nwachukwu Godson observed that “Some of the major workplaces where the exercises were conducted are Schulmberger, Port Harcourt; Julius Berger Construction Company, Abuja; Dangote Cement Bagging and Packaging, Lokoja; Sundry Food, Rivers State; Shellberg Manufacturing, Lagos; Federal Palace Hotel, Victoria Island, Lagos State, among other hundreds in informal sector and small scale companies.”
Uzoma Emelife is the Managing Director of NNPC Properties Limited, NPL. In this interview with Funsho Kareem, she discusses the prospects and opportunities of NPL in the real estate space, as well as the business model being activated. She insists that leveraging on the brand name and its size, NPL is set to create a paradigm realignment in property and asset/facility management. Excerpts:
Many are not too aware of NNPC Properties Limited, NPL?
NNPC Properties Limited (NPL) is the real estate arm of NNPC Limited established to capitalise on the potential within the Nigerian and diasporan real estate markets, generating revenue to NNPC Ltd as a non-core business. The company aims to become a leading player in the global real estate market by reliably providing customers with the highest level of real estate solutions and optimising value for its stakeholders, thus, competing with real estate companies of other National Oil Companies (NAOCs) like Saudi Aramco and PETRONAS. By adopting a strategic commercial approach and forging strong partnerships with established real estate developers and reputable facility management companies, NPL intends to leverage the brand equity and workforce of NNPC Ltd to maximise value from real estate development both for residential and facility management in general.
What are the market opportunities for exploitation by NPL?
Quite a lot. Let’s look at residential real estate. The Nigerian real estate market presents significant opportunities for NPL: The current national housing deficit is estimated at 28 million units, with a World Bank forecast of an additional 700,000 units needed every year for the next 20 years, highlighting the vast potential of the housing market. The market volume forecast for 2024 is expected to reach $1.93 trillion, representing a significant value for NPL to exploit in this segment. NPL has demonstrated its ability to facilitate housing product sales within NNPC Ltd, with N3.2 billion worth of sales facilitated in the last five years. This success highlights the significant potential for NPL to expand its market share and increase revenue by effectively positioning its products to appeal to the broader housing market.
In terms of size, it is expected that asset and property management would weigh heavily in the business space of NPL?
We have a huge real estate stock (356 properties) within NNPC Ltd with a potential for income from lease, tenant management, and maintenance across Strategic Business Units (SBUs). There is also the growing urban population resulting in a rise in the number of both commercial and residential properties presenting opportunities for property management allowing them to provide services such as leasing, tenant management, and maintenance to a wider range of clients. We also have the potential to harness the average rental rates of 230,000/sqm for commercial spaces (offices, retail, hospitality, etc.)
The strategy is for NPL to extend its property management services beyond rental space management and collections to overseeing and maintaining properties on behalf of SBUs/BUs. The company currently manages a total of 40 rental spaces across 11 locations within NNPC Ltd. A revenue potential of N0.5 billion can be realised from property management/lease administration within NNPC. To further capitalise on the real estate market, NNPC Properties Limited (NPL) has developed commercialisation strategies for select properties, which are estimated to generate over N1.4 billion in revenue for the company. This initiative would involve identifying underutilised or nonperforming assets within NPL’s/NNPC Ltd.’s portfolio and devising strategies to maximise the value of these assets through various means such as lease, sale, or joint venture arrangements. The company intends to form strategic partnerships with real estate developers, investors, and other key stakeholders to expand its network and increase the scale of its operations in property/asset management.
What is the economic potential of the facility management ecosystem?
The Facility Management market in Nigeria presents significant growth opportunities for NPL: The current market value is estimated at $8.45 billion, with a projected Compound Annual Growth Rate (CAGR) of 5.4% from 2024-2027, indicating a significant potential for growth. NNPC Properties Limited (NPL) intends to take advantage of its relationship with NNPC Ltd, which owns 17 office locations across Nigeria with a market value exceeding N7 billion, to provide Facility Management services across the business. This offers NPL a unique entry point into the facility management market, enabling the company to leverage NNPC Ltd.’s extensive real estate assets rapidly gaining significant presence in the market.
NNPC Properties Limited (NPL) aims to capitalise on its relations with NNPC Ltd to deploy Facility Management (FM) services across NNPC Locations nationwide. The FM market is estimated to be worth over N7 billion. The proposed strategy is for NPL to enter a joint venture (JV) or Special Purpose Vehicle (SPV) partnership with reputable FM companies to deliver this service within the next 5 years. NNPC Ltd will significantly benefit from cost savings across its 17 office locations through the proposed optimisation of FM services by NPL. An estimated N5 billion in cost savings can be achieved via project planning improvement and execution efficiency, allowing NPL to generate a revenue of about N3bn annually. The proposed strategy is expected to position NNPC Properties Limited (NPL) as a significant player in the FM space, enhancing the company’s presence in the market, and paving the way for future growth and expansion.
What type of business model are you adopting?
NPL’s business model is designed for full operation across the real estate value chain providing and sustaining value to shareholders in real estate development, asset/property management, and facility management; through a partnership model that requires minimal investment capital with partners providing equity in the form of technical know-how and counterpart funding. The real estate development strategy focuses on the acquisition and development of a varied mix of property types to create a balanced portfolio anticipated to generate sustainable returns in the short to medium-term through capital appreciation and sale of development units. This strategy, upon implementation, could unlock over N50 billion in value from proposed investments in the Lagos and Abuja real estate space over the next five years. NNPC Properties Limited (NPL) has initiated the implementation of its strategy by conducting an internal housing market survey (NNPC Ltd) in March 2024, where a significant 88% of the respondents expressed a desire to participate in real estate development projects led by NPL. This level of interest from within NNPC Ltd alone suggests that the NPL brand is trusted and accepted. This is an encouraging indicator for the success of the proposed strategy.
Do you foresee a positive outlook for the real estate investment market?
While the outlined strategies present a compelling opportunity for NPL to capitalise on the real estate market, it is critical to note that several factors are vital in ensuring the successful implementation of the plan. The company will require support in areas such as funding, inter-departmental collaboration, human capital development, and change management to effectively achieve its objectives and realize the full potential of the proposed strategy.
Many businesses suffered the fallout of the economic headwinds which adversely impacted their profitability as clearly indicated in their year end results.
Like most businesses, the MultiChoice Group also had its own fair share of economic woes, albeit minimally.
In the executive summary of the Group FY24 annual results for the year ended March 2024 by Calvo Mawela, the Group CEO, he admitted that the past financial year, which ended in March 2024, has been like no other in terms of economic turmoil.
But thankfully, he said the company showed resilience and navigated significant headwinds – managing its business with focus, dedication, and tenacity.
According to him, the business model adopted by the company helped to deliver on its strategic objectives. “This involved shifting our focus from subscriber growth to preserving profitability and cash flows, including the implementation of retention and cost-saving initiatives. We executed well, and I would like to thank each of you for your efforts, your continued passion and your hard work!”
Going down memory lane, Mawela recalled that four years ago the company embarked on a transformative journey to become Africa’s entertainment platform of choice. “We developed a strategy to expand beyond video entertainment to offer a broader selection of entertainment and scalable tech-based consumer services, so we could cater for our customers’ evolving needs and generate new revenue streams in the process. Today our business comprised of three core segments that are fully operational: video entertainment, interactive entertainment, and fintech.”
He was however quick to admit that volatile and weaker local currencies, power challenges in markets like South Africa, and a weak consumer environment due to rising inflation and high interest rates, created an extremely challenging environment for the group’s customers and operating segments. Nonetheless, MultiChoice South Africa, he stressed, achieved a trading profit margin of 26%, while MultiChoice Africa increased trading profit by 48%.
“We also successfully launched Showmax 2.0, SuperSportBet and Moment, all of which are now generating revenues and supporting our future growth prospects. I was particularly impressed by your contribution to our cost-saving drive. We delivered ZAR1.9bn in cost savings, significantly exceeding our initial target of ZAR0.8bn for the year. I appreciate your help on making our business more efficient, something we will continue doing in the year ahead.”
Interestingly, the outlook for Nigeria and the Rest of Africa was not altogether cherry news. Specifically, the MultiChoice boss said “the FY24 presented the toughest set of macro-economic conditions for the Rest of Africa business since 2016. The official and parallel naira exchange rates reached peaks of N1600:1 USD and N1900:USD respectively in February 2024, with several other African markets also experiencing extreme foreign exchange depreciation. This resulted in a translation impact for the segment’s USD revenues of 32%.”
High double-digit inflation in many of the group’s core markets, he noted, led to immense pressure on customer spending power.
“This, combined with the benefit of the FIFA World Cup and Nigerian elections in the FY23 base, resulted in the active subscriber base falling by 1.2m to 8.1m at end FY24.
“Pressure at the bottom end of the market, where subscribers have been most affected by the negative macro conditions, contributed to an improved subscriber mix in FY24, with the premium tier down 9%, the mid-market tier up 13% on the back of focused retention activities and the mass-market down 20%. Sub-Saharan Africa SVOD (Showmax) FY24 represented a pivotal year for Showmax. Having officially concluded the partnership with Comcast in April 2023, the long-awaited relaunch took place in February 2024.”
Besides, MultiChoice declared that the decline in Nigeria affected its overall subscriber database, leading to a 9 per cent decline for the year.
While the total subscription figure for Nigeria was not stated as it was lumped with other operating units outside South Africa tagged ‘Rest of Africa’ (RoA), it reported that the 18% decline in Nigeria brought the RoA’s total active subscribers down by 13% to 8.1 million from 9.3 million in 2023.
“The group’s 9% decline in active subscribers was mainly due to a 13% decline in the Rest of Africa business as mass-market customers in countries like Nigeria had to prioritise basic necessities over entertainment, while the South African business showed more resilience with a 5% decline.
“The Nigerian economy and consumers faced persistent challenges through FY24. The removal of fuel subsidies, sharp currency depreciation with the official naira halving in value, inflation climbing to over 30%, and higher emigration of the middle and upper class drove an 18% YoY decline in active subscribers,” the company said, adding that this also reduced Nigeria’s contribution to the Rest of Africa revenues from 44% to 35%.
It noted, however, that Ghana saw a similar subscriber trend given an inflation rate that is still above 20 per cent.
Despite a disciplined approach by the group towards inflation-led pricing, the combination of foreign exchange headwinds and a lower subscriber base resulted in a net decline in group revenues of 5% to ZAR56.0bn (+3% organic). Subscription revenues were 7% lower (+2% organic) and advertising revenues followed a similar trend (-7% reported, +3% organic), both impacted by the weaker naira.
Weaker subscriber trends and foreign exchange pressures flowed through to group trading profit which was down 21% to ZAR7.9bn (+24% organic). The commencement of the Showmax investment cycle reduced the group’s trading profit by ZAR1.4bn. Nonetheless, the group was able to generate positive operating leverage on the back of a 3% organic increase in revenues against a 1% organic decrease in operating expenses.
Multichoice further stated that due to the challenging market dynamics, the short-term focus of its RoA (Nigeria, Angola, Kenya, Ghana, and Zimbabwe) business was shifted from subscriber growth to safeguard profitability and cash flows.
“Several cost-saving initiatives were implemented, including scaling back significantly on decoder subsidies (-46% YoY or ZAR1.3 billion), and reducing selling, general, and administrative (SG&A) costs by ZAR500 million. These interventions enabled the Rest of Africa business to increase trading profit by 48% YoY to ZAR1.3 billion, it added.
In 1993, when Cowbell entered the Nigerian market by Promasidor Nigeria Ltd, it was the first milk powder brand sold in economy pack or sachet sizes at affordable prices. The company targeted the low income earners who could not afford to buy the regular big packs. Other brands followed suit and began to sell in small affordable packs.
As it was in 1993, so it is now in 2024 where consumers are now opting to buy staple food stuffs in small packs and wait for this: yams!
Yam is one of the popular food products in Nigeria. However, with the soaring prices of yams, not many people can afford to buy a tuber for as high as N5,000-N6,000. Earlier in the year, about January, the same size of yam sold for about N2,500. Although the increment in prices cut across all sectors of the economy, food produce is the worst hit.
Investigations across major yam markets like Mile 12 market along Ikorodu Road, Ille-epo market in Alimosho Local Government, revealed that the average price of yam is as high as N5000-N6000. During the first two months of this year, consumers were still buying small tubers of yams for between N1000-N1500 but the story unfortunately is different now.
The sight of yams cut in halves in the market was hitherto a rarity but not anymore as consumers are jostled to get a bargain.
Justifying the latest development, Alhaji Aliyu Mohammed one of the big dealers of yams at Mile 12 market recalled that hitherto yams were halved purely by the seller to forestall wear and tear but not anymore.
“We only cut up yams in the market when we see signs that the yam is about to decay. In such instances we remove the rotten part so that it will not affect the entire tuber. Most times we take such yams home to eat or sell it at a very low price.
“However that is not the case now. Some buyers come to market requesting for yams of N500 or N1,000 and we will have no option other than to cut the tuber of yam as you cannot get a whole tuber that will sell for that low amount,” explained Mohammed.
Moving around the markets, cut up yams were conspicuously displayed in small portions by the side of the traders unlike before.
Speaking with a buyer who would not be named, she said she was buying full tubers before but because of the high price of yams now she can only afford to buy the cut up ones. “I have only N1000 to buy yam and there is no tuber of yam for that amount. I appealed to my customer and he agreed to cut the tuber and give me a portion for N1,000.”
Mr Ahmed Danjuma, a yam seller in Iyana-Ipaja, said: “Many people no longer buy yam because of the cost. We now cut the yams in pieces and rearrange broken ones to sell at the rate of N500 to N1,000, depending on the size. People buy them a lot more than the tubers.
“It also helps us increase sales because not everyone can afford a medium-sized tuber of yam for N3,000 to N3,500. Some food vendors also go for it.”
Danjuma further noted that “Apart from the lack of money, some people are afraid of buying a big tuber and at the end of the day discover that almost half of the yam is bad. It will be very painful to experience such a waste. That is why many now buy pieces of yam.”
For Mrs. Iyabo Majekodunmi, a wholesale yam seller in Iyana-Iba market, the high cost of yams is driving many consumers to resort to buying yams in halves. “A small tuber of yam from the farm is N1,200. When it gets here it is sold for N1,400 or N1,500 when you add logistics. When it gets to the hands of retail traders, they sell by adding N100 or N200. As you can see, we are not in the yam season.”
Mrs. Janet Omoriege, a retail yam seller in Agbara said, “The smallest size of yam here is N1,800 which can hardly feed a family of three. The medium-sized yam tuber is N3,000 while the biggest tuber is N5,000. The prices also differ depending on the type of yam whether it is Abuja, Benue and so on.”
“Seeing that people always retreat whenever they hear the price of yam, I decided to cut it into pieces, especially those with broken parts.This has improved sales and helped retain my customers,” explained Omoriege.
Mrs. Lydia Eket, a customer patronising Omoriege said: “The pieces of yams are the best to buy this season. I prefer buying it because it’s less expensive and you can know if it is bad or not especially this season when a lot of yams are bad. “Where is the money to buy a big size tuber of yam for N5,000 for a family of five. It is only God that is seeing some families in our country today.We are just spending money but not seeing the value of what we are spending.”
In its latest Selected Food Price Watch report, the National Bureau of Statistics, NBS said that, the average price of 1 kilogram of yam tuber rose by 141.25 per cent on a year-on-year basis from N443.02 in March 2023 to N1,068.78 in March 2024.
“On a month-on-month basis, it increased by 5.8 per cent from N1,009.56 in February 2024 to N1,068. in March 2024,” it added.
Just last week, the chairman of Mile 12 international market Alhaji Shehu Usmam Jibril said that only 30per percent of Farmers now bring food products to the market warning that unless the issue of banditry and insecurity is resolved and farmers allowed to go back to their farms, prices of food items will continue to escalate and Nigeria will remain in hunger.
The Advertisers Association of Nigeria (ADVAN) has put Nigeria on the global map after clinching the Presidential Award of the World Federation of Advertisers (WFA) emerging top 6 out of 100 entries from 60 countries to win the coveted global recognition.
Excited about the win, the association also unveiled a 6-point Roadmap of its newly elected executive plans to embark on for the next two years. This was revealed during the press conference held recently at its secretariat in Lagos.
Speaking on the awards, the President of ADVAN, Osamede Uwubanmwen said the award is evidence of the association’s contributions to the global advertising and marketing communications landscape through its advocacy, innovative programmes, and initiatives.
He explained that ADVAN was given a special award for seeking to tackle one of the most persistent challenges facing marketing around the world, the poor briefing that leads directly to less effective creative output. He pointed out that agencies complain that poor briefs from brands impact the outcome of their creative and campaigns so they proffer solutions to the challenge.
“Our entry that won is on our training on brief writing. The reason for this is that some of the things we get as a response in marketing are that agencies always complain that the kind of briefs that advertisers send to them are the reasons they do not get the required result. We see brief writing and training as something we needed to do, so we gathered young brand and marketing managers, we trained them and we also gave the outstanding ones award.”
He added “This award is for Nigeria and we are happy that as an Exco we are able to put Nigeria on the global map and this is the first time we will receive such an award. We hope to receive another one next year. We understand that the reward of good work is more work and we are pledging to do more.”
Launched in 2010, the annual Presidents Awards of WFA recognises initiatives run by national industry associations that help advance the marketer’s agenda and contribute to positive change in the marketing industry and society.
In a statement issued by WFA, the WFA President and Chief Marketing and Communications Officer at Mastercard, Raja Rajamannar disclosed that “Each of these six local initiatives exemplifies the power of collaboration to tackle big issues facing our industry and establish best practices for marketers everywhere. A sincere congratulations to this year’s winners”.
Reeling out the plans of the new ADVAN executives, Akinrimisi Olabode Samuel, Treasurer ADVAN, said the association is set to make more impact and build on the achievement of successive administrations with its 6-point plans.
The plans include providing specialised support for marketing professionals, including resources to all members, which will include information on marketing effectiveness, and real-time answers to on-the-job issues via a website poll from members and the WFA network.
Recall that the association elected new executives during its Annual General Meeting (AGM) held recently. The new executives are Osamede Uwubanmwen, Commercial Director, Biogenerics Nigeria Limited who returned as President for a second term; Yusuf Murtala, Marketing Director, Coca-cola was elected 1st Vice President; OTega Ogra, SSA Digital Engagement, Communications & New Media Strategy emerged 2nd Vice President and the others.
