Author: The Nation

Eko Electricity Distribution Company (EKEDC) has witnessed remarkable progress in the past 12 months, with major reforms in client and staff management, stakeholders’ engagement, proactive maintenance and long-term sustainability.

A one-year status report showed that over the course of one year, EKEDC has witnessed marked changes in a number of important areas. Staff training and incentives, core service delivery, client and community engagement, operational strategy, as well as strategic brand positioning have all received significant rejigging, in some cases, and complete overhaul, in others. It has been one long stretch of innovation, rethinking, and optimization of systems and processes. And the results have been remarkable.

The 12-month stretch has seen the expansion of the client base, the decentralization of districts to cope the surge of new customers and optimize service, the implementation of upward review of staff remuneration and the launch of a fast-delivery mass metering programme (Mobile MAP Initiative) which led to the delivery of over 46,000 meters in 2022 alone.

The company has also seen far-reaching and impactful corporate social responsibility (CSR) projects consistent with its four CSR pillars of health and wellness, sports, education and technology. CSR interventions have included outreaches to schools and communities, as well hosting or support of meaningful events. Analysts agreed that for EKEDC, it has been one eventful year, a year of marked progress and positioning for greater progress.

EKEDC had also partnered with the United States Agency for International Development (USAID) in the launch of the Energy Club programme in Lagos secondary schools, a STEM initiative aimed at boosting the next generation’s interest and participation in subjects related to science, technology, engineering, and mathematics. It also donated a full-range children’s playing ground to Oremeji 2 Nursery and Primary School, Tolu School Complex and Ajegunle – Apapa school. Other CSR initiatives included sponsorship of the 2022 Lagos International Polo tournament, the T20 Invitational Women’s Cricket tournament, and the Festival of Table Tennis organized by the International Table tennis Federation.

The appointment of Dr. Tinuade Sanda as Managing Director of the EKEDC in March 2022 heralded several changes that have been credited with catapulting the company to a new height. When Sanda was appointed, not many might have expected the seamless assumption of such of a lofty role, the raft of reforms that followed shortly after, and the sustained progress that has continued ever since.

But for those who have known Sanda, it couldn’t have been otherwise. As someone with in-depth domain experience and proven administrative capacity, having been a senior management staff, she was ready from day one. Her success secret has been being a team player. At the board, management and staff levels, she has continued to maintain a disposition of cooperation, constructive engagement, and eagerness to listen and learn. A fine set of attributes. All things considered, this has been a masterful control of the reins of exalted office, if ever there was one.

And what’s more, Sanda has approached the huge responsibility of high office with delicate poise, grace and humility, being so accessible that the rigid hierarchy of the conventional corporate system seems alien to her. This people-centred approach to leadership has had a one-year assessment span, and the results are in.

She clearly understood the need for a rallying philosophy, something to inspire the team and underpin every strategy. Upon assumption of office, she launched the Mission Possible catchword. It was a call to defiance against odds, resilience through and through. It challenged every team member and summoned their highest commitment. It was a clear statement of purpose— no challenge, no matter how daunting, will ever be able to prevent the attainment of EKEDC’s set goals. Success was non-negotiable.

The performance of EKEDC under Sanda’s leadership has not gone unnoticed. Customers and stakeholders have noted and commended improvements in meter distribution, energy equipment repair and replacement. EKEDC received 150 brand new transformers, which have helped in improving overall customer service. There are notable areas to improve upon but the progress has been significant, as recognised and commended by stakeholders. And the awards have been coming. EKEDC has received awards from reputable brands like the Industrial Training Fund (ITF), Nigeria Employers Consultation Association (NECA) and Afri-Safe among others.

As stakeholders reflect on EKEDC in the past one year under Sanda’s leadership, they can proudly recount corporate records of improved power supply to customers, highest collection ever, lowest ever aggregated technical commercial and collection (ATC & C) losses, substantial reduction in work-related accidents, and marked increase in staff retention. The ATC & C loss is the difference between the amount of electricity received by a distribution company from the transmission company and the amount of electricity for which it invoices its customers plus the adjusted collections loss.

Going forward, EKEDC appears poised for greater records. Customers and stakeholders can rest assured of better performance as the steady leadership of Sanda, with the support of the board, management and staff, continues to provide impetus for growth.

Shareholders of United Capital Plc have approved the payment of N9 billion as cash dividends for the 2022 business year.

At the annual general meeting at Transcorp Hilton Hotel, Abuja, shareholders approved the distribution of a dividend per share of N1.50 for the 2022 business year, amidst celebration of the company’s 10th year as a listed company on the Nigerian Exchange (NGX).

The audited report of the company for the year ended December 31, 2022 had shown a 13 per cent increase in profit before tax to N13.50 billion. Gross earnings rose by 49 per cent to N26.90 billion while total assets grew by 33 per cent to N601.92 billion.

Addressing the shareholders, Chairman, United Capital Plc, Prof. Chika Mordi, said despite the macroeconomic pressures of 2022, United Capital reported an outstanding financial performance with the group’s Return on Average Equity (RoAE) one of the highest among listed financial services institutions.

He said the performance of the group signified solid growth in the overall profitability of the group and its subsidiary businesses.

“We are confident in our ability to deliver consistent superior returns as we have put in place appropriate strategies to respond to possible scenarios that the year 2023 could throw at us,” Mordi said.

He outlined that in addition to its outstanding financial performance, United Capital’s subsidiaries individually recorded significant milestones during the year.

“The investment bank acted as joint issuing house to Dangote Industries Limited (DIL)’s $1 billion bond issuance, the largest bond issuance in the Nigerian debt capital market by a corporate entity. Its asset management subsidiary won the award for the fastest growing investment management company in Nigeria at the 2022 International Finance Awards and remains among the top three fund managers in Nigeria. The Trustees business cemented its industry leadership as the number one trustee business in Nigeria in terms of funds under management (FUM) and its consumer finance business disbursed over 130,000 loans totalling N21 billion,” Mordi said.

Group Chief Executive Officer, United Capital Plc, Mr. Peter Ashade, explained that this year marks the company’s 10th year as a publicly quoted company on the Nigerian Exchange, describing it as a decade of excellence and progress for both the organisation and its shareholders.

“This year, business sustainability, innovation, digitalization, and increasing global competition for talent are megatrends that will define how we operate given our long-term business objectives and goals. We will continue to position the organisation as a globally reputable financial institution with the best team of professionals creating solutions and unique experiences for our clients and delivering superior value to all stakeholders while fostering social development and promoting financial inclusion across the geo-political zones that we operate,” Ashade said.

He said that United Capital has already started plans to expand its commercial operations, noting that the group recently received a microfinance banking license from the Central Bank of Nigeria (CBN) in an effort to foster financial inclusion by offering diverse market segments access to loans, investments and capital raising solutions.

He added that the group has also expanded its global footprints by securing strategic partnership with two leading Swiss investment banks.

Increasing inflows from foreign portfolio investors (FPIs) may curb decline and boost Nigeria’s foreign exchange (forex) reserves as the country struggles with low oil production and a huge fuel subsidy.

Group Executive Director, Investment Banking, Cordros Capital, Mr. Femi Ademola, said inflows from FPIs could provide a short-term succour for Nigeria’s declining forex reserves.

Ademola spoke against the background of 10-week consecutive decline in forex reserves. The Nation had reported exclusively on Monday that Nigeria’s external reserves have lost about $1.43 billion in the past 10 weeks of sustained decline, dropping from $37.211 billion by January 16, 2023 to $35.78 billion at the weekend.

 He identified low revenue from oil, oil subsidy and the country’s import-dependent economy as major reasons for the continuous pressure on the forex reserves.

“I think the biggest culprit is the low revenue from oil due to decline in oil price. This is despite the ramping up of the country’s oil production to above 1.6m bpd from a low of 1.0m bpd by mid 2022. This prevents any sizeable accretion to the reserve from excess crude oil income.

“The growing fuel subsidy also puts a serious pressure on the reserves as the Nigeria National Petroleum Company (NNPC) makes deductions from the revenue directly at sources.  The continuous importation of major goods to the country and the unending capital flight through emigration, education and health tourisms are also causing increasing demands on forex.

“The combination of all these ensures that the Central Bank of Nigeria (CBN) is unable to add to the currency reserves but rather takes from the reserves to meet the usual demands.

“There is however some comfort in the fact that foreign portfolio managers are now optimistic about the country’s economic prospects and may be looking for opportunities to invest in Nigeria. While this may likely be more of hot monies rather than patient capital, it would by and large help to improve the reserves in the short term while sending a more reassuring signal to the markets,” Ademola said.

Nigeria’s external reserves, which closed 2022 at about $37.08 billion, had picked at $37.211 billion on January 16, 2023. It has since been on the decline, dropping to lower level every week over the past 10 weeks.

Analysts agreed that Nigeria’s shaky forex reserves position was directly due to the CBN’s currency management stance. The apex bank’s fixed-rate, controlled exchange policy has seen the emergence of parallel markets with some 290 basis points between the official rate and the market-driven, unofficial parallel market.

Over the past 10 weeks, the naira had depreciated from N453.58 per dollar to N460.98 per dollar.

In a major recovery, Nigeria’s FPIs status had witnessed a major turnaround with annual inflows outweighing outflows for the first time in five years.

Annual trading data on FPI showed that foreign investors bought more Nigerian stocks than they sold in 2022, reversing the negative trend that started in 2018.

FPI transactions ended 2022 with a surplus of N12.29 billion, as against a deficit of N24.74 billion recorded in 2021. Nigeria recorded FPI deficit of N234.66 billion in 2020, about 125 per cent increase on N104.3 billion recorded in 2019. The country had slipped into negative with FPI deficit of N66.3 billion in 2018.

The FPI report, coordinated by the Nigerian Exchange (NGX), included transactions from nearly all custodians and capital market operators and it is widely regarded as a credible measure of FPI trend. The report uses two key indicators-inflow and outflow, to gauge foreign investors’ mood and participation in the equities market and the economy. While inflows and outflows indicate direction of portfolio transactions, total FPI measures the momentum and level of participation.

When inflows outweigh outflows, it simply means foreign investors are buying more quoted equities than they are selling and when outflows outpace inflows, it implies that foreign investors are selling more of their investments than buying more investments. Thus the position of FPI surplus or deficit.

FPI inflows closed 2022 at N195.76 billion as against outflows of N183.47 billion. FPI outflows had outweighed inflows at N229.62 billion and N204.88 billion respectively in 2021. However, total FPI transactions dropped from N434.5 billion in 2021 to N379.23 billion in 2022. The proportion of foreign transactions to total transactions declined from 22.88 per cent in 2021 to 16.32 per cent in 2022.

Total transactions at the Nigerian equities market had jumped from N1.899 trillion in 2021 to N2.324 trillion in 2022 as domestic investors defied political transition and spiraling inflation to accumulate stronger positions in quoted shares.

The 2022 FPI surplus was a major recovery for the market, although the momentum of foreign transactions remained on the decline. FPIs in Nigerian stock market had dropped consecutively to lowest levels in recent years. Active participation of foreign investors in Nigerian market declined by 11 percentage points from about 34 per cent of total market transactions in 2020 to about 23 per cent in 2021.

• Geregu Power to unlock wealth for Nigerians

Lagos businessman and Chairman, Geregu Power Plc, Mr. Femi Otedola, yesterday called on the incoming government to confront the challenges in the power sector by engaging experienced private sector investors to resolve the problems militating against the optimization of the sector.

Speaking at a closing gong ceremony to commemorate the first annual general meeting of Geregu Power at the Nigerian Exchange (NGX), Otedola said the incoming government should make the power sector one of its top priorities.

According to him, the incoming administration should do all it could  to tackle power sector challenges by prioritizing resolution of the key issues facing the sector.

He pointed out that while the power sector is faced with a lot of problems, these problems are surmountable by engaging the right approach and investors.

Otedola said the major problem facing the sector now is transmission, noting that a well-organised power sector will lead to cheaper power supply, which will have a lot of positive impact on the manufacturing sector and the entire economy as a whole.

“I believe we are now in the stage that the power sector will get a lot of attention. We have new plants. Our problem is transmission, there is need to look in this direction. We are in a stage where the new government can come and tackle the challenges in the power sector and hopefully there will be positive results. So, what is needed is to seek investors who have knowledge of the private sector to work on these challenges,” Otedola said.

He outlined the trailblazing efforts of Geregu Power as the first power company to list its shares on the Exchange, the first to embark on an aggressive 300 per cent expansion drive and the first company to release its financial results.

He reiterated the commitment of the company towards delivering improved performance, assuring that all necessary steps are being taking to expand the company’s capacity in order to  maximise shareholders’ wealth.

He expressed delight at the company’s first year anniversary as a listed company, adding that for any company to sustain wealth, there is a need to list on the stock exchange.

Chief Executive Officer, Geregu Power Plc, Mr. Akin Akinfemiwa, commended the capital market community for their support in listing the company and trading on the company’s shares.

“We have come today to state our unflinching commitment towards upholding the values and ethos of the Exchange. We are doing everything within our means to expand our capacity towards maximizing shareholders’ value,”Akinfemiwa said.

Chairman, Nigerian Exchange (NGX),  Alhaji Umaru Kwairanga,  said Geregu Power had shown good example in adhering to post-listing requirements.

He urged other power companies to come on board and get listed so that they can also benefit from the capital market.

According to him, the stock market has compensated Geregu Power with price appreciation and it has shown that the market is information driven.

Chief Executive Officer, Nigerian Exchange (NGX), Mr. Temi Popoola, described Otedola as a firm believer in the capital market, noting that the Exchange was aware of Geregu Power’s  strategic ambitions to ensure more value for all stakeholders..

 “We are aware of your strategic ambitions and we assure you that the NGX can help you to raise capital. We have seen benefits of that with the public announcement of FEDA that took a five per cent on the floor of the market through those shares. So we hope that you will be using the market now and in any other strategic vehicles and companies that you may have,” Popoola said.

Geregu Power rewarded shareholders with a dividend of N8 per share for the year ended December 31, 2022. Shareholders yesterday approved the dividend at the annual general meeting in Lagos, amidst commendations for the board and management.

Shareholders assured that they would continue to support the company in order to ensure it performs better in the years ahead.

Continued investment in start-ups tackling barriers across the value chain will be critical to maximise the full potential of Africa’s e-mobility sector set to grow to $5.07billion by 2027, according to a new report.

The report, Powering Renewable Energy Opportunities (PREO) programme said electric motorcycles are set to be a dominant force in sub-Saharan Africa’s sustainable mobility transformation.

Two-wheelers are quicker and more easily manoeuvrable than four-wheeled vehicles, especially across sub-Saharan Africa, where countries often have poor-quality roads. Motorcycles also provide stable income opportunities. The Charging Ahead – Accelerating e-mobility in Africa report from PREO outlines the market opportunity for e-motorcycles to become a driving force in the African e-mobility sector as, according to analysis by Mordor Intelligence, the market for motorcycles in Africa was worth $3.65billion in 2021, and is projected to grow to $5.07billion by 2027.

However, to accelerate progress in the e-mobility sector and meet the demands of a rapidly expanding customer base for two-wheelers, there are a number of challenges that need to be addressed. These include improving the availability of durable hardware, reliable charging infrastructure and access to high-quality battery solutions.

According to industry estimates, more than 90per cent of electric motorcycles sold in sub-Saharan Africa are imported from China and India and are not built for African conditions. Poor grid infrastructure means baseline electricity access is not reliable enough to support renewable battery recharge networks, and the electricity supply is weak. In addition, high-quality battery suppliers prioritise global buyers able to order at volume, which leaves small start-ups out of the picture.

The report examined how three PREO-supported companies – Roam (previously Opibus), Mobile Power and Zembo – are successfully addressing each of these barriers, and together are providing the solutions needed to support an enabling ecosystem to accelerate progress across the entire e-mobility sector.

Roam is a Swedish-Kenyan company that manufactures robust electric motorcycles in Kenya. The company is demonstrating that with the support of local manufacturing and assembly, the final price of electric motorcycles can be lowered to compete with ICE (internal combustion engine) vehicles while also customising the product to local conditions. Roam has now acquired the capacity to fully design the vehicles and manufacture 35per cent of them in-house with a goal to reach 70per cent in the next three to five years.

The company plans to expand beyond Kenya to other African markets through strategic partnerships, raise $17.5 million in equity and debt for working capital and hopes to supply Uber with 3,000 electric motorcycles for its delivery services across sub-Saharan Africa.

Ugandan company Zembo has developed a solution to enable the roll-out of e-motorcycles in areas with weak and unreliable access to electricity by using solar energy to charge the batteries.

In Uganda, Zembo operates 27 battery-swap stations for electric motorcycles, considered one of the largest networks in the region. It sells motorcycles to taxi operators on a pay-as-you-go basis and provides batteries-as-a-service through its battery-swap network. 73per cent (personnel cost – 55per cent, rent – 18per cent) of the monthly cost of operating a swap station is fixed cost in nature, delaying profitability and slowing down expansion.

Zembo’s scale-up strategy involves expanding its network using risk-sharing mechanisms such as franchisee models, and reducing personnel costs by deploying automatic swap cabinets. The company is also installing solar power solutions for off-grid areas and hybrid power for on-grid areas with weak or unreliable grids. This will enable batteries to be charged even in areas that are not on the grid and during grid blackouts. Zembo plans to expand its fleet to more than 2 000 motorcycles and 60 swap stations by 2025.

Mobile Power operates in Sierra Leone, Liberia, the Democratic Republic of Congo and Nigeria and is tackling the scarcity of high-quality battery technologies for small-scale businesses. The company has developed clean energy storage products (lithium-ion batteries) that it offers to businesses and individuals through a rental model. Since 2017, Mobile Power has grown its rental business to 500,000 rentals every month and is gaining 2,000 new customers every week at its peak growth periods.

Mobile Power is now replicating its rental model in the mobility sector and generator replacement sector by leveraging the same technology components: batteries, battery management systems and battery charging hubs. The company has now reached a stage whereby it can manufacture robust batteries tailored to African conditions at scale for its in-house use and satisfy the demand of its electric mobility peers. Mobile Power’s pay-per-use battery-swap model enables customers to access the service based on their needs.

Jon Lane, PREO Programme Director, comments: “Investing in e-motorcycles provides a path to more sustainable and equitable growth across African communities and addresses the urgent issue of climate change. Through our work with several start-ups, we have identified opportunities for a full ecosystem of solutions that address challenges across the value chain. We hope this report demonstrates the impressive progress being made by companies in the e-mobility sector and will act as a call for investors, policymakers and partners to engage and collaborate to help meet the scale of the challenge.”

PREO is funded by the IKEA Foundation and UK aid (via the Transforming Energy Access platform), and is delivered by the Carbon Trust and Energy 4 Impact  To date, it has supported 27 productive-use-of-energy enterprises across 11 countries in sub-Saharan Africa, four of which are in the e-mobility sector.

Jono West, co-founder and Chair of Mobile Power: “PREO’s support has been incredibly valuable to us for de-risking our battery technology and business model. It has enabled us to grow and increase the rate of scale for the e-mobility business and capture learnings that now form the basis of future technology solutions we have in the pipeline, even beyond e-mobility. As a result of this PREO project, we are now in discussions with several new partners across the value chain, which will be announced in due course.”

Étienne Saint-Sernin, co-founder of Zembo: “We’ve already proved that our business model is profitable in urban on-grid areas. Now, this PREO-co-funded project will give us the opportunity to prove that our solar-powered solution is viable and replicable in off-grid areas as well. We’ll then be in a strong position to unlock private investments to expand to other African countries.”

Filip Lövström, co-founder and Chief Executive Officer of Roam: “With the support from PREO we were able to accelerate and validate our product-market fit, refine our business models and design our next-generation electric motorcycle that is now ready to scale. PREO’s grant subsidised our early-stage production costs for pilots, and ultimately helped us reach commercialisation of a product that puts more earnings into end-users’ pockets and creates a positive environmental impact.”