The Nation Newspaper

Category: Equities

  • ECOWAS Bank to raise 25b francs in Q1

    The ECOWAS Bank for Investment and Development (EBID) plans to raise 25 billion francs (FCFA 25 billion) this quarter as the regional financier continues to explore domestic and international funding opportunities.

    Speaking after the 61st meeting of the board of directors recently, President, ECOWAS Bank for Investment and Development (EBID), Mr. Bashir Ifo said the bank has a continuous process through which it raises funds from financial markets within the region, Europe and Asia to finance its projects.

    He said the bank plans to raise 25 billion francs within the UEMOA capital market this quarter.

    He noted that the bank has also been authorised to issue a Eurobond in the international capital market, adding that EBID also raises funds on a bilateral basis from Asia especially from EXIM Bank India while discussions are ongoing with China Development Bank.

    He said the board approved partial financing for a $50 million public sector road construction project, the Sasstown-Klowein-road construction project, in the Republic of Liberia which among other crucial components comprises civil works for about 50 kilometres.

    He added that the board also approved the 2018 activity report and 2018 accounts which were both recommended for the approval of the board of governors.

  • ECOWAS Bank to raise 25b francs in Q1

    The ECOWAS Bank for Investment and Development (EBID) plans to raise 25 billion francs (FCFA 25 billion) this quarter as the regional financier continues to explore domestic and international funding opportunities.

    Speaking after the 61st meeting of the board of directors recently, President, ECOWAS Bank for Investment and Development (EBID), Mr. Bashir Ifo said the bank has a continuous process through which it raises funds from financial markets within the region, Europe and Asia to finance its projects.

    He said the bank plans to raise 25 billion francs within the UEMOA capital market this quarter.

    He noted that the bank has also been authorised to issue a Eurobond in the international capital market, adding that EBID also raises funds on a bilateral basis from Asia especially from EXIM Bank India while discussions are ongoing with China Development Bank.

    He said the board approved partial financing for a $50 million public sector road construction project, the Sasstown-Klowein-road construction project, in the Republic of Liberia which among other crucial components comprises civil works for about 50 kilometres.

    He added that the board also approved the 2018 activity report and 2018 accounts which were both recommended for the approval of the board of governors.

  • Equities continue decline with N121b loss

    Nigerian equities continued on the decline yesterday, losing N121 billion in the fifth consecutive negative session. With more than three losers for every gainer, the overall market situation indicated continuing selloffs across the sectors.

    Benchmark indices at the Nigerian Stock Exchange (NSE) showed a decline of 1.02 per cent, equivalent to net capital depreciation of N121 billion in the five-hour trading session. The decline depressed the average year-to-date return to -0.37 per cent.

    The All Share Index (ASI)-the main index that tracks share prices at the Exchange, declined from its opening index of 31,636.66 points to close at 31,313.36 points. Aggregate market value of all quoted equities dropped from its opening value of N11.798 trillion to close at N11.677 trillion.

    All sectoral indices also closed negative with the exception of the NSE Industrial Goods Index, which rose by 0.24 per cent. The NSE Banking Index dropped by 2.26 per cent. The NSE Consumer Goods Index dipped by 1.26 per cent. The NSE Insurance Index dropped by 0.51 per cent while the NSE Oil & Gas Index declined by 0.37 per cent.

    There were 30 losers against eight gainers. 11, formerly Mobil Oil Nigeria, led the losers with a drop of N5.10 to close at N165. International Breweries followed with a loss of N2.65 to close at N24.05. Guaranty Trust Bank declined by N1.80 to close at N35.50. Dangote Cement and NASCON Allied Industries dropped by N1 each to close at N194 and N20.70 respectively. PZ Cussons Nigeria lost 65 kobo to close at N11 while Dangote Sugar Refinery declined by 55 kobo to close at N14.

    On the positive side, Lafarge Africa Plc led the gainers with a gain of 50 kobo to close at N13. UACN Property Development Company and United Capital followed with a gain of 13 kobo each to close at N1.95 and N3.28 respectively. Africa Prudential rallied 12 kobo to close at N4.92. Union Bank of Nigeria added 10 kobo to close at N7 while Law Union and Rock Insurance chalked up 4.0 kobo to close at 56 kobo per share.

    Total turnover stood at 219.37 million shares valued at N2.93 billion in 3,345 deals. Banking stocks dominated activities chart. FBN Holdings was the most active stock with a turnover of 60.14 million shares valued at N493.12 million. Zenith Bank followed with 46.46 million shares worth N1.05 billion while Diamond Bank placed third with 14.47 million shares valued at N35.32 million.

    Many analysts however stated that recent declines in share prices have primed the market for a recovery, but many others remained cautious.

    “Despite the consecutive negative performance recorded, we expect investor bargain hunting to drive market performance over the near term,” Afrinvest Securities stated.

    Analysts at Cordros Capital noted that in the absence of a positive catalyst, as well as the still tense political milieu, investors should trade cautiously in the short term.

    “However, stable macroeconomic fundamentals and compelling valuation remains supportive of recovery in the mid-to-long term,” Cordros Capital stated.

     

     

     

  • NOVA Merchant Bank nets N1.15b in 2018

    NOVA Merchant Bank Limited grew its net profit by 125 per cent to N1.15 billion in 2018 as the wholesale banker continued to reap the benefits of its investments in its operations, technology and people.

    Key extracts of the audited report and accounts of NOVA Merchant Bank for the year ended December 31, 2018 showed that the merchant bank achieved strong growth across all parameters. The bank recorded a 54.10 per cent growth in gross earnings from N1.22 billion in 2017 to N1.88 billion in 2018. The bank further grew the total assets by 38.89 per cent from N18 billion in 2017 to N25 billion in 2018. Profit after tax rose from N510.6 million in 2017 to N1.15 billion in 2018.

    Managing Director, NOVA Merchant Bank Limited, Anya Duroha,  said the bank’s performance was a culmination of the hardwork, commitment, resilience, discipline and resourcefulness of all its  employees.

    “We have been able to drive strong customer acquisition and deploy leading edge technology whilst optimising our costs. We will continue to focus on growing our business, providing solutions tailored to our clients’ needs, building a high performance culture, motivating our employees and creating sustainable value for our shareholders,” Duroha said.

    He added that the impressive result demonstrated the bank’s growth trajectory which is expected to accelerate as it scales its business and grows its client base.

    According to him, the performance marks a very successful year for the newly licensed merchant bank which recently deployed a state of the art and fully digital core banking application. The bank also recorded remarkable growth in customer acquisition and in line with its objective to be the employer of choice, promoted about a third of its workforce.

    Chairman, NOVA Merchant Bank Limited, Remarking on the results, Phillips Oduoza, said the bank has been able to build a strong foundation as it approaches the future with confidence and optimism in its business model, value proposition, clients and employees.

    :We remain committed to the implementation of our over-arching philosophy of ‘New Thinking, New Opportunities’ to create value for all our stakeholders,” Oduoza said.

    He assured that the bank would continue to strive to deliver profitable, responsible and sustainable growth, noting that the bank remains dedicated to its core values of uniqueness, passion, leadership, integrity, fairness and teamwork as it believes these ethos will enable it to surpass the expectations of its clients and stakeholders.

  • Meristem, NSE launch two indices on investment direction

    Meristem Securities Limited and Nigerian Stock Exchange (NSE) have developed two new indices that will further enable investors and investment experts to track the performance of certain categories of stocks.

    The two new indices – NSE-Meristem Growth Index and NSE-Meristem Value Index, focus on growth and value investment strategies and enable investors to make investments in products that truly match their investment styles and objectives.

    The indices, which are calculated and maintained by the NSE, were developed on a style-focused methodology proprietary to Meristem Securities Limited.  The indices will be available real-time on the NSE’s website from tomorrow.

    There have been growing clamour for collaboration to develop customised indices to support product development and investment management at the stock market. Broadly, the latest style indices will provide a benchmark for the market to gauge the performance of value stocks and growth stocks listed on the Exchange.

    Group Head, Investment Research, Meristem Securities Limited, Mrs. Oluwakemi Akinde, said the indices will further deepen the equity capital market by providing a leverage for fund managers to build investment products.

    She noted that the new indices serve as more appropriate benchmarks for fund managers with same investment philosophies to measure effective performance, while they also facilitate better manager selection and appraisal.

    According to her, the new indices will also provide market data for academics to enrich studies on the performance of growth and value stocks in the market.

    “A multi-factor approach was considered in developing the indices to enhance the index stability and minimise turnover cost,” Akinde said.

    NSE Divisional Head, Trading Business Division, Mr. Jude Chiemeka described the  introduction of the NSE-Meristem Growth and NSE-Meristem Value Indices as a laudable and innovative effort long overdue.

    He said the indices provide products strategists and asset managers the leverage to create investment vehicles that democratise professional asset management for the benefit of investors, while still following the tenets of classic investment philosophies of growth and value.

    He urged the investing public to take advantage of the benefits from the indices to improve their asset selection and management.

    “We are pleased to collaborate with Meristem Securities in the development of the first style-focused indices to be publicly launched in Nigeria,” Chiemeka said.

    He added that the NSE-Meristem Growth and Value indices, as with all other NSE indices, will align with the index committee’s governance standards, noting that guidelines and methodologies for the indices are publicly available on the NSE and Meristem’s websites.

    Meristem Securities Limited for the past 15 years has led remarkable innovation within the capital market ecosystem to create value for investors. In 2014, Meristem was recognised as the first capital market operator to introduce a digital trading platform, and in 2017, it handled the single largest trade in the history of the NSE.

     

  • 100 shareholders’ associations in stock market

    There are more than 100 registered shareholders’ associations in the stock market.

    Former Commissioner and Acting Director-General, Securities and Exchange Commission (SEC) Ms Daisy Ekineh said the Commission had recorded more than 100 shareholders’ associations registered with the Corporate Affairs Commission (CAC) by 2017.

    She decried the proliferation of shareholders’ associations and their activities noting that shareholder associations are neither effective nor respected and therefore, not taken seriously by stakeholders including public companies.

    “They are perceived as often seeking pecuniary benefits from companies as against ensuring good governance. The associations are also perceived as disruptive rather than disciplined at Annual General Meetings. Besides, there are too many shareholders associations, making it difficult for regulators and others to effectively engage with them,” Ekineh said.

    She noted that in order to mitigate the negative activities of the associations, SEC had issued the Code of Conduct for Shareholders Associations which should strengthen the associations, if embraced by them.

    Ekineh was the guest speaker at the maiden forum of Issuers & Investors Alternative Dispute Resolution Initiative (IIADRI) held in Lagos

    She pointed out that shareholder associations can only ensure required governance on companies, if they themselves act responsibly and with integrity.

    “Shareholder activism in Nigeria should not be synonymous with confrontation and intimidation but effective engagement. To do so requires knowledge of their companies and understanding of the subject matter. Effective shareholder activism complements regulators in investor protection, promotes good corporate governance and could enhance shareholder value,” Ekineh said.

    Also , SEC Acting Director-General Mary Uduk assured investors of its readiness to ensure that disputes arising from capital market activities are resolved amicably and in a timely manner.

    Uduk, represented by Mrs. Olubukanla Rufai, a director at the Commission, noted that the complaint management framework, issued by SEC, spells out the procedures for resolution of disputes and encourages the first line resolution of disputes between investors, capital market operators and public companies before escalation to relevant authorities.

    “Without investors, there can be no capital formation. Investors are thus, the life wire of any capital market and as such, must be protected. The Commission takes investor protection seriously, as it is one of its core mandates,” Uduk said.

    She noted that shareholders’ associations were borne out of the need to promote good governance of public companies, influence corporate and government policies that seek to encourage investment, advance the interest of shareholders, especially the minority shareholders, and optimise shareholders’ value.

    According to her, shareholders’ associations, should ideally, provide a platform for networking and exchange of ideas among shareholders and give minority shareholders greater access to knowledge and increased awareness on the financial and operational activities of companies.

    She assured shareholders of the readiness of the Commission to resolve capital market disputes timely and amicably.

    “Disputes arise in everyday life. As such, the capital market has also witnessed its share of disputes over the years. The Commission is committed to ensuring that disputes are resolved amicably and in a timely manner,” Uduk said.

  • Nestle to pay N46.4b above-profit dividend

    The Board of Directors of Nestle Nigeria Plc has recommended distribution of N30.52 billion as final dividend for the 2018 business year, bringing total dividend payout for the year to N46.42 billion. The company had in November 2018 paid N15.9 billion as interim dividend.

    Shareholders will receive a final dividend per share of N38.50 in addition to interim dividend per share of N20, bringing total dividend per share for the year to N58.50.

    With the dividend payout above the N43.01 billion net profit recorded in 2018, the company explained that the total payout of N46.42 billion included net profit for the year and part of the net profit for the 2019 business year.

    According to the company, the final dividend of N38.50 per share comprised of N34.20 from the profit for the 2018 business year and N4.30 from the net profit for the 2019 business year.

    Key extracts of the audited report and accounts of Nestle Nigeria for the year ended December 31, 2018 showed that the company rode on the back of improved operating efficiency and finance cost management to optimise its bottom-line performance in 2018, growing net profit by 27.5 per cent to N43.01 billion.

    The report showed that turnover rose to N266.27 billion in 2018 as against N244.15 billion in 2017, representing an increase of 9.06 per cent. Cost of sales increased by 6.33 per cent from N143.28 billion in 2017 to N152.35 billion in 2018. Gross profit thus rose faster by 12.94 per cent to N113.92 billion in 2018 compared with N100.87 billion in 2017.

    Marketing and distribution expenses increased to N43.49 billion from N35.16 billion while administrative expenses dropped from N10.02  billion to N9.79 billion. Operating profit consequently improved from N55.7 billion in 2017 to N60.64 billion in 2018. Finance costs dropped by 82.75 per cent from N15.109 billion to N2.606 billion. Profit after tax grew by 27.53 per cent from N33.72 billion in 2017 to N43.01 billion in 2018. With these, earnings per share rose by 27.52 per cent to N54.26 in 2018 as against N42.55 in 2017. Total assets increased by 10.58 per cent to N162.34 billion in 2018 as against N146.80 billion in 2017. Shareholders’ equity also improved from N44.88 billion to N50.22 billion.

    Nestle Nigeria Plc Managing Director Mr. Mauricio Alarcon said the 2018 results were commendable in the light of the increasingly competitive business environment.

    According to him, the growth was driven by the continued loyalty of consumers as the company focused on consistently delivering high quality, tasty and nutritious food products adapted to their preferences.

    He said the company has continued to invest in innovation to keep delighting consumers with its iconic brands noting that the multi-cereal Nestlé Golden Morn Puffs fortified with iron was introduced during the year.

    “We look forward with cautious optimism in view of the challenging business environment.  We will focus on leveraging our capabilities to deliver value to our consumers and our shareholders as we contribute to the growth of the local economy and to improving livelihoods within our communities,” Alarcon added.

     

  • Continental Reinsurance awaits SEC’s final approval on acquisition

    Securities and Exchange Commission (SEC), Nigeria’s apex capital market regulator, is considering the propriety of giving its final nod to the ongoing bid by majority core investor in Continental Reinsurance Plc to buy out other minority shareholders.

    Continental Reinsurance Company Secretary Ms Patricia Ifewulu at the weekend confirmed that the reinsurance company had submitted application for the final approval of the scheme for the consummation of the acquisition.

    She said the apex capital market regulator has continued to engage with the reinsurance company as the application undergoes the final approval process.

    “The SEC is still reviewing the transaction file and is engaging with the company in that process. The company expects to receive the final approval in the coming weeks and will thereafter apply to the Federal High Court for the approval of the scheme,” Ifewulu stated in a regulatory filing at the weekend.

    Shareholders on December 20, 2018 at a court-ordered meeting approved a takeover bid launched by the majority core investor in the reinsurance company to buy out retail minority shareholders and turn Continental Reinsurance into a wholly-owned subsidiary.

    The board of Continental Reinsurance had announced that it had received an offer from CRe African Investments Limited (CRe Investments), a major investor in the Nigerian company, to acquire all the outstanding and issued shares of Continental Reinsurance.

    According to the board, CRe Investments was making the offer in order to initiate a much needed restructuring exercise for Continental Reinsurance, with a view to consolidating its operations and repositioning it for enhanced competitiveness in the global insurance market.

    The acquisition is being executed through a Scheme of Arrangement under Section 539 of the Companies & Allied Matters Act Cap C20 Laws of the Federation of Nigeria 2004 and other applicable rules and regulations.

    CRe Investments had offered N2.04 per share for the 10,372,744,314 ordinary shares of 50 kobo each or one ordinary shares of $1 each in the capital of CRe Investments for every 176 ordinary share of 50 kobo each held in Continental Reinsurance.

    However, the scheme consideration was revised upwards from N2.04 to N2.10 per share, with the new price representing 51.08 per cent premium on the share price of Continental Reinsurance as at the close of trading on October 5, 2018 which was the last business day prior to the date on which the proposal was received from CRe African Investments Limited.

     

  • Seplat grows profit by 499% to N80.6b

    Seplat Petroleum Development Company Plc recorded strong growths in sales and profitability in 2018 as pre-tax profit quadrupled to N80.6 billion.

    Key extracts of the audited report and accounts of Seplat for the year ended December 31, 2018 showed that turnover rose by 65 per cent from N138.28 billion in 2017 to N228.39 billion in 2018. Profit before tax jumped by 499.4 per cent to N80.62 billion in 2018 compared with N13.45 billion recorded in 2017. However, with taxes of N35.75 billion paid in 2018 as against tax gain of N67.66 billion in 2017, profit after tax dropped to N44.87 billion in 2018 compared with N81.11 billion in 2017. Earnings per share thus dropped from N143.96 in 2017 to N79.04 in 2018.

    The board of the company has recommended a dividend per share of $0.05, the same payout for 2017 year.

    Chief Executive Officer< Seplat Petroleum Development Company Plc, Mr. Austin Avuru said the company has delivered an excellent operational and financial performance resulting in robust profitability and cash flow generation that provide it with an extremely solid foundation for growth in the coming years.

    He said the company’s core assets in the West, OMLs 4, 38 and 41, the extension of the license to 2038 means that the company can confidently plan and invest long into the future to realise the full potential of those blocks.

    “As we continue to enhance production and revenue diversification with new wells scheduled at OML 53 in the East, the board took the final investment decision to invest in the large scale ANOH gas and condensate development which will form the next phase of transformational growth for our gas business,” Avuru said.

    He noted that disciplined capital allocation continues to remain at the core of activities evidenced by continual deleveraging of debt levels to the current balance of $350 million.

    According to him, during the immediate past year, the company reinstated the dividend, increased capital investments and with the resources and headroom in its capital structure, it has been equipped to capitalise on organic and inorganic growth opportunities as they may arise.

    He said the company will, going forward, retain its price disciplined approach to only allocating capital to the highest cash returning organic and value accretive acquisition growth opportunities.

    He assured that with a robust dividend yield,  Seplat will become the investment of choice in Nigeria to access sub-Sahara Africa’s most prolific oil and gas opportunities.

     

     

  • Vitafoam Nigeria assures of better returns

    •Shareholders get dividend, bonus

    Shareholders of Vitafoam Nigeria Plc yesterday approved the payment of N260.51 million as cash dividend and a scrip dividend of one share for five shares as the directors of the company assured that it would sustain the current growth trajectory.

    At the annual general meeting in Lagos, shareholders commended the company for what they described as impressive results in 2018. They approved the distribution of N260.51 million, representing a dividend per share of 25 kobo, in addition to bonus share of one new ordinary share of 50 kobo each for every five ordinary shares of 50 kobo each.

    Key extracts of the audited report and accounts for the year ended September 30, 2018 showed that Vitafoam Nigeria recorded impressive growths in sales and profitability. Group turnover rose from N17.69 billion in 2017 to N19.53 billion in 2018. Profit before tax jumped from N18.13 million in 2017 to N793.85 million in 2018. After taxes, the company reversed net loss of N127.69 million recorded in 2017 with a net profit of N601.92 million in 2018. Earnings per share thus improved from a loss of 15 kobo in 2017 to a gain of 57 kobo in 2018.

    Group Managing Director, Vitafoam Nigeria Plc, Mr Taiwo Adeniyi, said consistent growths in key performance indicators in successive results provide basis for assurance that the company will be able to surpass its previous performance in the current business year.

    He noted that the first quarter results for the current business year had shown the direction of the group’s business, adding that the second quarter results, which will be released in the next few weeks, further consolidated the performance of the company.

    Key extracts of the interim report and accounts of Vitafoam Nigeria for the three-month period ended December 31, 2018 had shown that turnover rose by 26.3 per cent while profits before and after tax doubled by 98.48 per cent and 123.14 per cent respectively. Group turnover stood at N6.38 billion in December 2018 as against N5.05 billion recorded in comparable period of 2017. Profit before tax rose from N258.53 million to N513.12 million while profit after tax jumped from N162.17 million to N361.87 million. Earnings per share also increased from 13 kobo by December 2017 to 33 kobo in December 2018.

    Adeniyi said the group’s Nigerian businesses are on a stronger footing while three of its seven subsidiaries have started to generate profit.

    He said the company will continue to innovate and develop products that will keep it ahead of competition and enable it to grow its turnover while extracting better values for shareholders.

    Chairman, Vitafoam Nigeria Plc, Dr Bamidele Makanjuola, said the growth in turnover and profitability reflected the robustness and fundamental strength of the group’s business.

    According to him, the company had taken strategic decision and reengineered its business with special focus on products quality, innovation, market differentiation, customer service and consumer education.

    “These efforts underscored our long-term priorities of growing revenue, controlling operating costs, and driving higher gross margins. I am pleased to report that we made great strides in cost containment and sustained positive trends in gross margins,” Makanjuola said.

    He said the dividend payout and bonus shares were rewards to shareholders for their unwavering support and commitment to the cause of the company.

    “We will continue to champion investment in people, processes and technology in a bid to grow revenue and consolidate the strategic transformation of our company,” Makanjuola assured.