The Nation Newspaper

Category: Equities

  • Lafarge Africa admits matters delaying financial statement

    LAFARGE Africa Plc Board of Directors has admitted that unresolved major issues are the cause of the delay in the company’s submission of its audited financial statements and accounts for the 2018 business year and the first quarter of 2019.

    In a regulatory filing, the Mobolaji Balogun-led board, which had earlier sought extension at the expiration of March 31, 2019 deadline, stated that it was still unable to meet the extended deadline.

    According to the board, there was further delay due to “pending actions required for the resolution of key matters relating to the closure of the company’s annual audited financial statement for the year ended December 31, 2018”.

    External auditors usually refer key matters to “those matters that, in professional judgment, are of most significance in the financial statements and audit of a company”. These matters usually play important roles in the conclusive opinion of the external auditors on the accounts.

    The company said it had sought and received Nigerian Stock Exchange (NSE) approval for the further delay, expressing optimism that “all the issues will be fully resolved and the audited financial statements will be submitted not later than June 28, 2019”.

    Lafarge Africa had suffered a net loss of N10.37 billion by the third quarter of the 2018 business year. Key extracts of the interim report and accounts of Lafarge Africa for the nine-month period ended September 30, 2018 had shown that sales rose from N223.67 billion in third quarter 2017 to N234.30 billion in third quarter 2018. With cost of sales rising from N165.76 billion to N178.21 billion, the cement company, however, ended with a pre-tax loss of N14.36 billion in 2018 as against pre-tax profit of N1.09 billion in comparable period of 2017.

    After tax gain of N4.04 billion, net loss after tax stood at N10.37 billion in third quarter 2018 compared with net profit after tax of N937.91 million in comparable period of 2017. With these, loss per share for the nine-month period stood at N1.20 in 2018 as against positive earnings per share of 10kobo in corresponding period of 2017.

    Post-listing rules at the NSE require quoted companies to submit their earnings reports, not later than 90 calendar days after the expiration of the period. Companies are also required to submit their interim quarterly results not later than 30 days after the end of the relevant period.

    Most quoted companies, including all banks, major manufacturers, oil and gas companies, breweries and cement companies use the 12-month Gregorian calendar year as their business year. The business year thus terminates on December 31.

    NSE’s regulatory filing calendar indicated that the deadline for submission of annual report for companies with Gregorian calendar business year ended December 31, 2018 was March 31, 2019. However, March 29, 2019 was the last working day for the period, thus effectively the deadline for submission of the reports in line with the traditional practice at the Exchange. The deadline for the submission of first quarter 2019 results was April 30, 2019.

     

  • Experts meet on Islamic finance

    Experts from the private and public sectors will tomorrow meet in Lagos to discuss the progress and opportunities of Islamic finance in Nigeria.

    The inaugural edition of the IFN Nigeria Forum themed: “Harnessing the Islamic Finance Sector for Infrastructure Development and Economic Growth”, holds tomorrow at Eko Hotels and Suites, Lagos.

    The forum, being hosted by the Nigerian Stock Exchange (NSE) in partnership with REDmoney Group, is aimed at promoting the growth and development of the Nigerian Islamic finance industry and facilitate the growth of a new asset class in the capital market.

    The IFN Nigeria Forum 2019, which will be headlined by Ms Mary Uduk, Acting Director-General, Securities and Exchange Commission (SEC), will bring together a stellar line-up of speakers, comprising senior industry players, decision makers, regulators and investors, to exchange their views and experiences on opportunities in the Nigerian Islamic finance market. It will feature a mix of panel sessions, onstage interviews and interactive sessions on a number of themes in Islamic finance including, Corporate Financing and Capital Raising in Nigeria.

    Other speakers confirmed for the event include Director-General, Debt Management Office of Nigeria, Ms Patience Oniha; Acting Director-General, National Pension Commission, Hajia Aisha Dahir-Umar; Divisional Head, Trading Business, NSE, Mr Jude Chiemeka; Managing Director, Lotus Capital, Hajara Adeola; Partner, Udo Udoma & Belo Osagie, Adeola Sunmola, and Head, Debt Capital Markets, FBNQuest Merchant Bank, Oluseun Olatidoye.

  • Dangote Cement floats N50b commercial papers

    Nigeria’s most capitalised quoted company and Africa’s largest cement producer, Dangote Cement Plc, at the weekend issued new commercial papers to raise N50billion in new short-term capital.

    This is the eighth to 10th series of its N150 billion CP programme. The leading cement company will use the net proceeds to support its short-term funding.

    Dangote Cement offered 90-day CP with effective yield of 12.5254 per cent and a discount rate of 10.51 per cent under its 8th series. The 9th series CP was a 180-day instrument with effective and discount yield of 12.5254 per cent and 13.35 per cent respectively. The 10th series CP was a longer tenor 270-day CP with effective and discount yield of 12.6862 per cent and 14.00 per cent respectively.

    The 90-day CP is expected to mature on September 12, 2019 while the 180-day and 270-day CPs will mature on December 11, 2019 and March 10, 2020 respectively.

    Application list for the offer had closed on June 13, 2019. Minimum subscription was N5 million and thereafter in multiples of N1,000. The CPs were allotted on the closure date, but were issued on June 14, 2019. The offer opened on June 7, 2019.

    Dangote Cement has a rating of    Aaa from Moody’s and AA+ from GCR. Dangote Cement recently indicated it invested $3 billion in its Pan-African operations.

  • Fed Govt lists $5.37b Eurobonds on NSE, FMDQ

    The Federal Government at the weekend listed five tranches of Eurobonds totaling $5.37 billion on the Nigerian Stock Exchange (NSE) and the FMDQ OTC Securities Exchange, paving the way for trading on the dollar-denominated bonds.

    The Debt Management Office (DMO), which oversees government bond issues, listed the five tranches of new debt issues, including $750 million, 9.248 per cent notes due in  2049, $1.118 billion notes due in 2025, $1 billion notes due in 2031, $1.25 billion due in 2038 and $1.25 billion 7.143 per cent notes due in 2030.

    DMO Director General, Ms Patience Oniha, said the bonds were raised for refinancing of the country’s domestic debt, while the proceeds would be used to fund the fiscal deficit as well as other financing needs of the country.

    She outlined that $2.50 billion Eurobonds issued in February 2018 were meant for refinancing of domestic debt while $2.86 trillion Eurobonds issued in November 2018 were purposely for financing of the capital project of the budget.

    According to her, the Eurobonds were in line with the Federal Government’s debt management strategy aimed at achieving lower cost.

    Oniha noted that listing of  foreign currency-denominated debt securities showed government’s unrelenting commitment to supporting the growth of the debt capital market for economic development.

    She said government was committed to achieving ratio of 60-40 per cent ratio between domestic and external debts, noting that the government aims at positioning Nigeria in the global capital market through the Eurobonds pointing out that external fund raising has yielded great gains with many research analysts writing about Nigeria.

    According to her, central government’s sovereign issues have opened ways for the private sector and other tiers of government to raise funds to finance their projects.

    On plans for Eurobond upgrade to finance the 2019 budget, she said the appropriation act 2019 has a deficit.

    “A large part of it will be funded by new borrowing of N1.649 trillion and 50 per cent of that is provided as external right there in the appropriation bill act which means we will be borrowing externally. But this time around, we are trying to explore all the options, starting with those that are  cheaper, conventional, semi conventional before we now determine in a very short form the balance that we should take to the international market,” Oniha said.

    She noted that the DMO and its executives cannot undertake any borrowing on its own without legislative approval.

    “So, whatever borrowings you see here listed in whatever form are borrowings approved in one way or the other either through the budget process or a special process,” Oniha said.

     

  • UK’s CISI, CIS, NCMI sign MoU on capital market training

    The Chartered Institute for Securities and Investment (CISI) of the United Kingdom has entered into agreements with Chartered Institute of Stockbrokers (CIS) and the Nigerian Capital Market Institute (NCMI) to strengthen professional training and qualification of Nigerian capital market operators.

    A computer-based renewable integrity test is one of the components of the Memorandum of Understanding (MoU) between CISI and CIS.

    Speaking after the signing of the MoU, First Vice President, Chartered Institute of Stockbrokers (CIS), Mr Tunde Amolegbe noted that the CIS may also adopt the current practice of writing integrity test by stockbrokers that aspire to join CISI.

    According to him, the Council of CIS is considering introduction of integrity test and making such mandatory and renewable for its members.

    He pointed out that integrity matters would always remain fundamental to the success of any profession.

    By the renewed MOU, stockbrokers are eligible to become members of CISI, subject to compliance with some requirements, including participation in the global body’s Continuing Professional Development (CPD) and membership. This is in addition to CIS’s membership and CPD requirements.

    CIS’s members will also be offered access to seven professional qualifications of CISI, all of which will be examined by Computer Based Testing (CBT) in Lagos. They are Securities (Capital Markets Programme), Derivatives (Capital Markets Programme), Certificate in Corporate Finance, Risk in Financial Services, Global Financial Compliance, Combating Financial Crime and Managing Cyber Security

    In order to reinforce their technical and professional knowledge of securities markets, CIS members who join CISI can access the full range of CISI membership benefits such as over 100 e-learning modules or Professional Refreshers, the CISI TV video platform with recordings of key CISI CPD events and the CISI online magazine.

    Chief Executive, Chartered Institute for Securities and Investment (CISI), Simon Culhane said the institute was delighted to confirm its cooperation with the CIS in the important areas of global membership reciprocity, professional qualifications, continuing professional development and ethics and integrity.

    According to him, in this era of emphasis on consumer protection, CISI looks forward to working with the CIS to further enhance Nigeria as a global capital market centre.

    The first MoU between CIS and CISI was signed in November, 2015. It is renewable every three years. Only recently, CISI announced its Council members in Nigeria in order to strengthen the global association’s presence in the country.

    CISI is also partnering with the NCMI, the educational and training arm of the Nigerian capital markets regulator, Securities and Exchange Commission (SEC).

    At the signing ceremony in Lagos, Acting Director General, Securities and Exchange Commission (SEC), Ms. Mary Uduk said SEC hopes to make NCMI a world-class training institute and the first amongst its peers.

  • Oando flays SEC over AGM suspension

    Oando Plc has decried the last-minute suspension of its scheduled annual general meeting (AGM) by Securities and Exchange Commission (SEC). SEC had on Monday ordered the suspension of Oando’s AGM, which had been scheduled for yesterday in Lagos.

    Oando’s share price depreciated by 2.60 per cent yesterday in post-announcement trading at the Nigerian Stock Exchange (NSE), representing a loss of N1.24 billion in market value. Oando’s  share price dropped by 10 kobo to close at N3.75 per share.

    In its official response to the suspension filed at the NSE, Oando stated that the cancellation of the scheduled AGM by SEC was not in the best interests of the Company and its shareholders who have travelled at great expense, from far and wide, to attend the AGM.

    “The company also stands to lose significant shareholder funds by the attendant cancellation of the AGM at such short notice,” Oando stated.

    Oando noted that it would take all legal steps to protect its business and assets whilst remaining committed to act in the best interests of all its shareholders.

    The company said it would soon announce a new date for the AGM.

    SEC had stated that the suspension was based on the Ex-parte order of the Federal High Court, Ikoyi, Lagos, which ordered status quo to remain.

    Oando disagreed with SEC’s position pointing out that it had by notice to the public and its shareholders on May 10, 2019 validly convened its 42nd AGM.

    “The actions contained in the SEC’s letter to the Company dated Friday, May 31, 2019 was effectively put in abeyance by the Ex-parte Order of the Federal High Court, which was granted on Monday, June 3, 2019,” Oando stated.

    Several shareholders have also criticized the suspension of the AGM and other actions being taken by the Commission against the indigenous oil and gas company.

    Shareholders under the auspices of Pragmatic Shareholders Association of Nigerian (PSAN) called on the Federal Government and other stakeholders to restrain SEC from creating unnecessary panic in the capital market.

    According to the shareholders, the suspension of the AGM was counterproductive as both the company and its shareholders will bear the pains and financial burden of the cancelled AGM.

    “Oando had planned and piad for this event as far back as May, what happens to all the money that was paid to the vendors to make the meeting a success? This is our hard earned money that has not been used judiciously as a result of SEC’s intervention,” PSAN stated.

    SEC stated that it suspended the AGM until further notice to allow the parties maintain status quo adding that it would update relevant stakeholders and the public on the outcome of the ongoing litigation.

    SEC had on May 31, 2019 released a statement indicting the management and board of Oando of sundry corporate governance abuses and infractions of the relevant capital market laws.

    SEC barred the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando from being directors of public companies for a period of five years. SEC also ordered certain members of board of directors of Oando to resign.

    The apex capital market regulator stated that it had concluded investigation into alleged corporate governance abuses at Oando and found that the company was guilty of serious infractions and market abuses.

    SEC also directed the payment of monetary penalties by the company and affected individuals and directors, and refund of improperly disbursed remuneration by the affected board members to the company.

    SEC also directed the convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors.

    These among others the SEC stated, are part of measures to address identified violations in the company.

    According to the SEC, following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando. Certain infractions of relevant laws were observed. The Commission further engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando.

    On June 2, 2019, SEC appointed an interim management team headed by Mr. Mutiu Sunmonu, a former Managing Director of Shell, to oversee the affairs of Oando and to conduct an extra ordinary general meeting on or before July 1, 2019 to appoint new directors to the board of the company, who would subsequently select a management team for Oando.

    Oando however described the directives from the SEC as a calculated attempt to prejudice the business of the company.

    The company stated that the alleged infractions and penalties are unsubstantiated, ultra vires, invalid and calculated to prejudice the business of the company.

    According to the company, it has not been given the opportunity to see, review and respond to the forensic audit report and so unable to ascertain what findings were made in relation to the alleged infractions and defend itself accordingly before the SEC.

     

  • Oando exudes confidence with N2.49b gain

    Oando Plc was a major contrarian stock at the Nigerian equities market yesterday, rallying N2.49 billion in capital gains as bargain-hunters sought to lock into the indigenous oil and gas stock. Oando’s share price rose by 5.26 per cent or 20 kobo per share to close at N4, representing total capital gains of N2.49 billion.

    Oando was also the sixth most active stock during a five-hour trading session that saw investors closing 3,686 deals for a total of 217.33 million shares valued at N5.82 billion at the Nigerian Stock Exchange (NSE). The overall market position at the NSE however closed negative, with average decline of 1.30 per cent, equivalent to net capital depreciation of N178 billion.

    Normalcy returned to the corporate headoffice of Oando yesterday after policemen vacated the premises in compliance with an order of a Federal High Court, restraining the Securities and Exchange Commission (SEC) from enforcing its decisions on the company.

    Sources in the know confirmed that armed policemen that took over the high-brow office complex, which houses several other firms, vacated the premises yesterday’s evening. A source condemned the seeming delay of SEC and the Nigeria Police Force (NPF) in complying with the court order noting that Oando had lost two working days to the show of force.

    Read also: Operators seek FG intervention in SEC, Oando saga

    A Federal High Court of Lagos under presiding Judge C M A Olatoregun had on Monday granted Oando’s Group Chief Executive (GCE), Adewale Tinubu, and Deputy Group Chief Executive (DGCE), Omamofe Boyo, an injunction restraining SEC from taking any step concerning its decisions indicting the board and management of Oando of sundry corporate governance malpractices and market abuses.

    The court also restrained Mutiu Sunmonu, who was appointed by SEC, from acting as the head of the interim management of Oando. The court also ordered a stay or suspension of the enforcement of the execution of the SEC’s decisions as contained in its letter dated May 31, 2019.

    The injunction directed all parties involved to maintain the status quo pending the determination of the motion on notice. The case was adjourned till June 14, 2019.

    Sources in the know confirmed that the board and management of the company remain unchanged and Mr Wale Tinubu and Mr Omamofe Boyo continue to act as Group Chief Executive Officer and Deputy Group Chief Executive Officer respectively. “They never resigned, they have continued to be GCE and DGCE,” a source said.

    SEC had last week released a statement indicting the management and board of Oando of sundry corporate governance abuses and infractions of the relevant capital market laws.

    SEC barred the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando from being directors of public companies for a period of five years. SEC also ordered certain members of board of directors of Oando to resign.

    The apex capital market regulator stated that it had concluded investigation into alleged corporate governance abuses at Oando and found that the company was guilty of serious infractions and market abuses.

    SEC also directed the payment of monetary penalties by the company and affected individuals and directors, and refund of improperly disbursed remuneration by the affected board members to the company.

    SEC also directed the convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors.

    These among others the SEC stated, are part of measures to address identified violations in the company.

    According to the SEC, following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando. Certain infractions of relevant laws were observed. The Commission further engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando.

    On June 2, 2019, SEC appointed an interim management team headed by Mr. Mutiu Sunmonu, a former Managing Director of Shell, to oversee the affairs of Oando and to conduct an extra ordinary general meeting on or before July 1, 2019 to appoint new directors to the board of the company, who would subsequently select a management team for Oando.

    Oando however described the directives from the SEC as a calculated attempt to prejudice the business of the company.

    In a statement signed by the Company Secretary, Ayotola Jagun and Head of Corporate Communications, Alero Balogun, the company stated that the alleged infractions and penalties are unsubstantiated, ultra vires, invalid and calculated to prejudice the business of the company.

    According to the company, it has not been given the opportunity to see, review and respond to the forensic audit report and so unable to ascertain what findings were made in relation to the alleged infractions and defend itself accordingly before the SEC.

     

  • Union Bank seeks to cancel N54.5b legacy losses

    The board of directors of Union Bank of Nigeria (UBN) Plc has called an extra-ordinary general meeting of shareholders to consider cancellation of N54.46 billion accumulated permanent losses in the books of the commercial bank.

    Shareholders are scheduled to meet next week to authorise the board of directors to reduce the company’s share premium account by N54.46 billion to net off the legacy deficit, thus removing the main drawback that had disallowed the commercial bank from paying dividends from its net profit.

    According to the resolution, subject to the confirmation of the court, the bank’s issued share capital, including for this purpose its share premium account, be reduced by the sum of N54.458 billion which has been lost or is otherwise unrepresented by available assets and that the credit arising from the reduction be used to eliminate the retained loss in the company’s audited financial statements as at December 31, 2018.

    The bank stated that a review of its financial position as at December 31, 2018 established a deficit of N54.46 billion as accumulated permanent losses from legacy transactions, in addition to the N247.87 billion, which had been approved by shareholders in 2017.

    The bank explained that the proposed balance sheet restructuring will not affect its authorised or issued share capital or regulatory capital but should result in a reduction of the credit balance in the bank’s share premium account, while leaving the aggregate shareholders’ funds unchanged.

    “It would have no impact on the bank’s creditors but rather, pave the way for the bank’s investors to receive dividends out of the bank’s future profits,” UBN stated.

    The board of directors is proposing a reduction of N54.46 billion from the bank’s share premium account of N187.09 billion, pursuant to sections 106 and 107 of Companies and Allied Matters Act (CAMA). The reserve arising from the reduction of capital would be used to eliminate the negative retained earnings as at December 31, 2018.

    UBN had grown its net profit by 39 per cent to N18.1 billion in 2018 but the bank could not declare dividend due to extant rules that disallow companies with retained deficit from dividend payment. Key extracts of the audited report and accounts of Union Bank for the year ended December 31, 2018 showed that gross earnings dropped by 11 per cent from N163.8 billion in 2017 to N145.5 billion in 2018. Net interest income declined by 17 per cent from N66.7 billion to N55.4 billion while non-interest income also dropped from N39.3 billion to N35.2 billion.

    With 113 per cent reduction in credit impairment, net income after impairments increased by 16 per cent from N80.64 billion to N93.5 billion. Profit before tax thus increased by 33 per cent from N13.9 billion to N18.5 billion. Profit after tax also rose from N13 billion to N18.1 billion. Earnings per share however declined by 11 per cent from 72 kobo in 2017 to 61 kobo in 2018.

  • Group supports cocoa farmers

    Olakoko Sustainability Project is supporting cocoa farmers with funding, training and quality crop protection insecticides for improved output and support for the economy.

    The project manager of the Olakoko Sustainability Project, Mrs Mopelola Fabunmi said the cardinal point of the project is to improve the lives of cocoa farmers in their host communities.

    She spoke at the third edition of Olakoko Farmers’ Day held at Igbara-Oke, Ondo State. According to her, the total wellbeing and welfare of cocoa farmers is key in ensuring that they produce improved cocoa products. She said: “We train and encourage our farmers to diversify so as to have something to lean on during the cocoa off-season. We have also added nutritional and health benefits of food to our training pack.”

    She noted that since its commencement in 2016, the Olakoko Sustainability Project which now operates in 17 local government areas of Ondo, Osun, Ogun and Edo states, have certified over 8,000 farmers on Good Agricultural Practices. She said that the project is keen on ensuring that cocoa farmers take good care of their farms in order to get good quality cocoa beans; therefore the Project links farmers with sources of good crop protection products such as fungicide, insecticide, and herbicides which are approved by authorised bodies such as Cocoa Research Institute of Nigeria (CRIN).

    She enumerated achievements of the project to include rebuilding four classrooms at Oke-Osin community in Atakumosa West Local Government Area (LGA) of Osun state to help children of cocoa farmers get good education in a conducive environment; providing school learning materials to children of cocoa farmers; renovating an abandoned borehole water project in Ifedore LGA of Ondo State, and organizing free medical medical checkup for cocoa farmers. She assured that

  • Ecobank CEO reiterates commitment to Africa

    The Managing Director, Ecobank Nigeria, Patrick Akinwuntan has stated that Africa is the strategy of Ecobank. Akinwuntan who was speaking in commemoration of Africa Day 2019 noted that Ecobank’s “approach to doing business in Africa is to create a united and integrated brand and platform that reflects the values of Africa as a whole whilst leveraging its diverse talents and resources to tackle its common challenges and realize its immense opportunities as one market”.

    “With a larger African footprint than any other bank in the world operating in West, Central East and Southern Africa, we are the only bank that spans 36 African countries, but operates a truly integrated African network.

    That is One unified integrated Ecobank Mobile Banking App, that works seamlessly across all 33 operating countries in Africa; One Ecobank Omni and Omnilite serving all Multinationals and SMEs in Africa; One Rapidtransfer app that breaks down country borders and allows the diaspora community send money directly to their loved ones, instantly and affordably across Africa; One Ecobank Online Banking platform that you can access easily whether you are in Abuja or Kinshasha.” He stated.