The Nation Newspaper

Category: Equities

  • Stock Exchange expels three brokers over shares ‘fraud’

    The Nigerian Stock Exchange (NSE) Council has expelled three stockbrokers for alleged misappropriation and fraudulent sale of client’s shares.

    A March 28 circular obtained by The Nation stated that the registration of Mr. Victor Ogiemwonyi, Mr Joel Okafor and Mrs Ladi Barbara Onwordi had been revoked as authorised  dealing clerks of the Exchange. Consequently, they shall not be allowed to participate in trading or owning a trading firm at the Exchange.

    The circular said the Disciplinary Committee of the NSE, which oversees ethics and compliance, indicted them for alleged misappropriation and unauthorised sale of client’s shares.

    Okafor and Onwordi, who were members and authorised dealers on the Exchange, were stripped of their registration and trading authority for allegedly selling their clients’ shares without the mandate.

    Ogiemwonyi, who has been at the centre of an alleged multi-billion naira capital market fraud, was expelled for “misappropriation of clients” funds. Ogiemwonyi, a fellow and former council member of the Chartered Institute of Stockbrokers (CIS) and former council member of the NSE, had earlier been indicted by the Administrative Proceedings Committee (APC) – the adjudicatory arm of the Securities and Exchange Commission (SEC).

    “Note that Mr. Okafor cannot be employed in any capacity, appointed as a director or have shareholdings of 5.0 per cent and above in any dealing member firm or sub-broker,” the circular signed by Head, Broker Dealer Regulation, NSE, Olufemi Shobanjo, said.

    A compliance officer with Ogiemwonyi’s firm, Partnership Securities Limited, Mr. Fisayo Ibrahim Jassey-Jabarr, was suspended for five years for alleged failure to report regulatory breaches during his tenure.

    “Dealing members are advised not to engage in any activity with the above listed individuals,” the Exchange warned.

    With the expulsion, the indicted stockbrokers will also not be able to work in any stockbroking and investment firms in Nigeria, according to Rule 6, (12) of the NSE Rules.

    Under the rule known as “Specific Actions Requiring Prior Consent of The Exchange”, a dealing member shall not be allowed to employ some categories of persons without the prior written consent of the Exchange.

    These included directors, authorised clerks or other persons including principal officers such as the chief executive officer, chief finance officer, chief compliance officer and chief risk officer, who have been indicted by the NSE or Securities and Exchange Commission (SEC).

    Others included any person who was an officer or employee of a dealing member expelled from the Exchange, any person expelled, as an authorised clerk or its equivalent, from any other exchange, any person refused admission as a member of the Chartered Institute of Stockbrokers or any person expelled from its membership, any person expelled as a member of any professional association or institute and any person who is insolvent or has been convicted of theft, fraud, forgery, or any other crime involving dishonesty.

    As financial pressure mounts on stockbrokers and stockbroking firms due to the prolonged downtrend at the stock market, authorities at the Nigerian stock market have stepped up concerted efforts to checkmate unauthorized sales of clients’ shares.

    The Nation had reported exclusively that the Economic and Financial Crimes Commission (EFCC) was investigating 10 stockbroking firms and 12 individual stockbrokers and officials as part of a large-scale crackdown on shares fraud that had seen 31 stockbroking firms and several stockbrokers internally investigated and sanctioned by the NSE in recent years.

    Two official reports on shares fraud had indicated that the NSE had invited the EFCC to further investigate and prosecute 12 stockbroking firms and 21 stockbrokers and officials, who were primarily indicted by the internal investigations of criminal financial fraud.

     

  • FCMB Group declares N1.98b dividend

    The board of directors of FCMB Group has recommended distribution of N1.98 billion as cash dividend for the 2017 business, representing a dividend per share of 10 kobo. It had paid the same amount for the 2016 business year.

    Key extracts of the audited report and accounts of FCMB Group for the year ended December 31, 2017 released at the Nigerian Stock Exchange (NSE) indicated that the financial services holding group struggled with constrained top-line and bottom-line in 2017 but the group’s underlying fundamentals remained strong.

    Group deposits grew to N689.9 billion in 2017, an increase of five per cent on N657.6 billion recorded in 20167. The Group’s capital adequacy ratio also improved to 16.9 per cent in 2017 as against 16.7 per cent in 2016. Asset base also increased to N1.19 trillion in 2017 compared with N1.17 trillion in 2016. Non-interest income stood at N32 billion in 2017 while loans and advances totalled N649.8 billion during the year.

    Headline figures, however, showed a top-down decline in actual figures. Gross earnings dropped from N176.35 billion in 2016 to N169.88 billion in 2017. Profit before tax declined from N16.25 billion to N11.46 billion. Profit after tax also dropped from N14.34 billion to N9.41 billion. Consequently, earnings per share dropped from 72 kobo in 2016 to N48 kobo in 2017.

    FCMB Group said the results showed improvement in the underlying performance of the group when adjusted for non-core business income that boosted the performance in the previous year.

    According to the company, in spite of the reduction in the headline numbers, the Group’s performance for the year 2017 witnessed an improvement in core operating performance over the previous year after adjusting for the significant foreign exchange revaluation income enjoyed in 2016.

    The company noted that in line with the repositioning strategy of the Group for better performance, the key drivers of the performance include increase in income from its non-banking activities, lower impairment charges from the bank and its subsidiaries, and improved operating efficiencies through more pervasive use of technology.

    ‘’Barring any unforeseen circumstances, we see improved operating performance in 2018 based on the improving macro-economic and capital markets environment, declining cost of funds for the bank, and the growing contributions of asset and wealth management following last year’s acquisitions,’’ the Group stated.

    FCMB Group Plc’s operating companies are divided along three business groups – commercial and retail banking, which includes First City Monument Bank Limited, Credit Direct Limited, FCMB (UK) Limited and FCMB Microfinance Bank Limited; investment banking, which includes FCMB Capital Markets Limited and CSL Stockbrokers Limited; and asset & wealth management, which consists of Legacy Pension Managers Limited, First City Asset Management Limited and CSL Trustees Limited.

     

  • New core investors get board appointment at UACN

    The founder and another nominee of an investment firm that recently emerged as the single largest shareholder in UAC of Nigeria (UACN) have been appointed as a non-executive director on the board of Nigeria’s oldest surviving business and largest conglomerate.

    The board of directors of UACN appointed Mr. Folasope Aiyesimoju, the founder of Themis Capital Management, as a non-executive director. Themis Capital Management recently emerged as the largest single shareholder in UACN with 8.0 per cent equity stake consisting of 232.35 million ordinary shares of 50 kobo each. Another nominee of Themis Capital Management, Mrs Olufunke Ighodaro was also appointed as a non-executive director.  A co-founder of Themis Capital Management, Mr. Peter Mombaur,will serve as alternate director to the duo of Aiyesimoju and Ighodaro.

    Three major shareholders had emerged with more than five per cent equity stake in UACN after the conglomerate concluded its recent N15.36 billion rights issue. A regulatory filing signed by Company Secretary, UAC of Nigeria Plc, Mr. Godwin Samuel, indicated the major shareholders of the conglomerate to now include Stanbic IBTC Nominees, with 8.0 per cent equity stake consisting of 225.23 million ordinary shares of 50 kobo each; Blakeney GP 111 Ltd, with 6.0 per cent equity stake consisting of 165.79 ordinary shares of 50 kobo each and Themis Capital Management, with 8.0 per cent consisting of 232.35 million ordinary shares of 50 kobo each.

    UACN had floated a rights issue to raise N15.36 billion by offering 960.43 million ordinary shares of 50 kobo each at N16 per share to pre-qualified shareholders. The new shares were pre-allotted to shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017. The application list for the rights issue had opened on November 15, 2017.

    At the period of the rights issue, UACN was owned by some 185,000 shareholders and no shareholder held five per cent and above other than Stanbic Nominees Nigeria, which held 17.86 per cent equity stake.

    Market sources said the two new major shareholders might have purchased renounced rights by Stanbic IBTC Nominees, which diluted the latter’s shareholding and spread the major shareholdings across three separate entities.

    The Nation’s check indicated that UACN has current total outstanding shareholdings of 2.881 billion ordinary shares. With this, Stanbic IBTC Nominees holds 7.82 per cent equity stake, Blakeney GP 111 Ltd holds 5.75 per cent equity stake while Themis Capital Management holds the highest equity stake of 8.06 per cent.

    Samuel confirmed the appointment of Aiyesimoju and another non-executive director, Mrs Olufunke Ighodaro.

     

  • 10 firms miss NSE’s deadline for filing audited reports

    First Bank Nigeria Holdings, Union Bank and Diamond Bank are part of the 10 companies that could not meet the March 31 deadline given by the Nigerian Stock Exchange (NSE) for filing audited financial reports.

    In statements posted on the exchange’s website, the companies notified the public of the delay and made the reasons known.

    The affected companies are FirstBank, Diamond Bank, Fidelity Bank, International Breweries, Linkage Assurance, Abbey Mortgage Bank, Guinea Insurance, Lafarge Africa Plc, Mutual Benefits and Union Bank.

    “The reason for the delay is purely due to the peculiarity of FBNH’s group structure. FBNH has subsidiary companies operating in the banking and insurance sectors as well as the capital market, all with a common financial year end of December 31 alongside the holding company.

    “Each of these subsidiaries needs to audit its financial statements and obtain the approval of its respective regulator prior to submission to FBNH for consolidation. Thereafter, FBNH is also required to obtain the approval of its primary regulator before submission and filing with the exchange,” FirstBank’s company secretary, Seye Kosoko, said.

    Fidelity Bank said the late filing was due to delay in concluding audit of the report.

    Linkage Assurance Plc said it could not secure the approval of National Insurance Commission (NAICOM), its primary regulator, before the filing deadline.

    International Breweries, which filed its audited financial statements for 2017 on April 4, said the delay was due to consolidation of the accounts of newly merged entities with that of the company.

    The company merged with Pabod Breweries and Intafact Beverages on November 13, 2017.

     

  • May & Baker increases dividend payout by 233.3%

    •Pre-tax profit rises by 75% to N605.6m

    Shareholders of May & Baker Nigeria Plc will receive a 233.3 per cent increase in cash dividend as the healthcare company sustained its improving performance with well-rounded growths in all kep performance indicators in 2017.

    The board of directors of the company has recommended distribution of N196 million as cash dividend for the 2017 business year, representing a dividend per share of 20 kobo. The recommended dividend payout for 2017 represents an increase of 233.3 per cent on the payout for the 2016 business year. May & Baker had distributed N58.8 million as cash dividend for the 2016 business year, with shareholders receiving a dividend per share of 6.0 kobo.

    Key extracts of the audited report and accounts of May & Baker Nigeria for the year ended December 31, 2017 released at the Nigerian Stock Exchange (NSE) showed that the healthcare company recorded significant growths in sales and profitability in 2017.

    The report indicated impressive improvements in the underlying fundamentals of the company as well as the actual earnings figures. The top-down improvements in margins underlined the increasing efficiency of the company’s operations and management’s commitment to cost efficiency.

    Group turnover rose by 10.39 per cent from N8.47 billion in 2016 to N9.35 billion in 2017. Gross profit grew by 29.13 per cent to N3.28 billion in 2017 as against N2.54 billion in 2016. Operating profit jumped by 51.04 per cent from N820.87 million to cross the billion Naira mark to N1.24 billion in 2017. Profit before tax leapt by 75.07 per cent from N345.94 million in 2016 to N605.62 million in 2017. After taxes, net profit stood at N370.87 million in 2017 compared with net loss after tax of N41.09 million recorded in 2016. Shareholders’ funds also rose by 10.3 per cent from N3.01 billion in 2016 to N3.32 billion in 2017.

    All key underlying performance indicators showed considerable improvements, indicating increasing profitability of the company. Gross profit margin improved by more than five percentage points to 35.08 per cent in 2017 compared with 29.99 per cent in 2016. Operating margin-which indicates the profitability of the core operations of the company, rose from 9.69 per cent in 2016 to 13.26 per cent in 2017. Pre-tax profit margin-which underlines the profitability of the company, also increased from 4.09 per cent in 2016 to 6.48 per cent in 2017.

    The management of the company attributed the performance of the company in 2017 to the success of management’s efforts to harness the potential of recent investments and reduce related costs.

    According to the management, despite the macroeconomic challenges, the company’s sales growth has continued to improve considerably above industry average, showing continuing efforts to retain and grow market share.

    Managing Director, May & Baker Nigeria Plc, Mr Nnamdi Okafor said that the improvement in margin validated management’s tight cost control measures and continuing efforts to harness synergies within the group to reduce costs and improve shareholders’ value.

    “Our results show our main focus of satisfying our customer and enhancing our shareholders’ value. Our steady implementation of many growth initiatives are paying off as can be seen in the latest results. We are also happy that the investing public is taking note of these improvements with the performance of our stock as one of the best-performing stocks at the market,”  Okafor said.

    He noted that the recent inauguration of the board of Biovaccines Nigeria Limited has raised the prospects that the subsidiary will soon begin to impact positively on the group performance.

    He pointed out that with the company’s world-class manufacturing facility in Ota, Ogun State, growing into a hub of pharmaceutical manufacturing in West Africa, the imminent commencement of operations by Biovacccines Nigeria Limited will open up a new vast vista of growth for the group.

     

     

     

    Minister of Health, Prof. Isaac Adewole recently inaugurated the board of Biovaccines Nigeria Limited in Abuja.  May & Baker Nigeria holds the majority equity stake of 51 per cent while the government holds 49 per cent equity stake in Biovaccines Nigeria Limited, the company set up for the purpose of May and Baker Nigeria-government partnership.

    The Federal Executive Council had at its sitting on May 31, 2017 ratified a joint venture agreement (JVA) between the Federal Government and May & Baker for the formation of a private company, Biovaccines Nigeria Limited to serve as a special purpose vehicle for the production of vaccines in Nigeria.

     

  • CCNN to pay N1.57b dividend as net profit rises by 157%

    The board of directors of Cement Company of Northern Nigeria (CCNN) Plc has earmarked N1.57 billion for distribution to shareholders as cash dividend for the 2017 business year as the cement manufacturing company grew its net profit by 157 per cent.

    A breakdown of the dividend recommendation indicated that shareholders will receive a dividend per share of N1.25 for the 2017 business year. CCNN did not pay dividend for the 2016 business year.

    Key extracts of the audited report and accounts of CCNN for the year ended December 31, 2017 showed significant growths in sales and profitability. Turnover rose by 39 per cent from N14.09 billion in 2016 to N19.59 billion in 2017. Gross profit nearly doubled from N4.94 billion in 2016 to N7.61 billion in 2017, representing an increase of 94 per cent.

    Profit before tax jumped by 141 per cent from N1.74 billion in 2016 to N4.20 billion in 2017. After taxes, net profit also leapt by 157 per cent to N3.22 billion in 2017 as against N1.25 billion in 2016. Earnings per share thus improved correspondingly from N1 in 2016 to N2.57 in 2017.

    The balance sheet of the company also improved as total assets grew by 23 per cent from N20.03 billion in 2016 to N24.65 billion in 2017. Shareholders’ fund also increased from N11.49 billion to N14.41 billion, representing an increase of 25 per cent.

    The underlying fundamentals of the company also improved considerably during the year, showing that the positive overall performance was driven by improvement in the operations of the company. Gross profit margin improved from 28 per cent in 2016 to 39 per cent in 2017. Net profit margin also doubled from 9.0 per cent to 16 per cent. Return on capital employed jumped from 11 per cent in 2016 to 22 per cent in 2017.

     

  • Transcorp rebounds with N12.3b profit

    Transnational Corporation of Nigeria (Transcorp) Plc witnessed considerable growth in turnover and profitability last year, pulling back from a pre-tax loss of N5.93 billion in 2016 to a pre-tax profit of N12.31 billion in 2017.

    Key extracts of the audited report and accounts of Transcorp for the year ended December 31, 2017 released at the weekend showed that turnover rose by 35 per cent from N59.42 billion in 2016 to N80.28 billion in 2017. Gross profit increased by 21 per cent to N36.42 billion in 2017 compared with N30.17 billion in 2016. Operating profit increased by 25 per cent from N20.72 billion in 2016 to N26.03 billion in 2017.

    Foreign exchange loss reduced to N4.55 billion in 2017 as against N18.7 billion in 2016 while net finance cost also improved from N26.64 billion to N13.73 billion. The company made provisions for N1.7 billion taxes in 2017 compared with tax credit of N4.80 billion received in 2016. With these, it reversed from a loss before tax of N5.93 billion in 2016 to profit before tax of N12.3 billion in 2017. After, taxes, net profit stood at N10.61 billion in 2017 as against net loss of N1.13 billion in 2016.

    The balance sheet position of the conglomerate also improved in 2017 as total assets rose by 23 per cent to N285.52 billion in 2017 as against N232.16 billion in 2016. Shareholders’ funds rose by 11 per cent from N86.45 billion in 2016 to N95.71 billion in 2017.

    Transcorp Chief Executive Officer, Mr. Adim Jibunoh said the profit was largely as a result of increase in power generation by Transcorp Power Limited due to improved gas supply and increased generation capacity.

    According to him, capacity increased from 505 megawatts to 701 megawatts during the year as capacity increase was achieved through carefully planned maintenance programme for power generation assets and tactical engagement with stakeholders.

    He added that the group’s hospitality business remained resilient, posting stronger year-on-year performance as it continued to maintain market leadership with occupancy levels that were way ahead of competition.

    He pointed out that the group’s second hotel, Transcorp Hotel, Calabar continued its strong performance, achieving profitability for two consecutive years.

    “We are confident of improved fundamentals going forward, as we increase our available generation capacity to above 800 megawatts by year-end taking advantage of improving gas situation. We expect to benefit from the upside of the new improved infrastructure upon completion of our upgrade project in Transcorp Hilton Abuja. The upgrade project is currently on track,” Jibunoh said.

    Transcorp’s group strategic investments include power, hospitality, agribusiness and oil and gas sectors.

    The group’s notable businesses are Transcorp Hilton Hotel, Abuja; Transcorp Hotels, Calabar; Transcorp Power Plc, Teragro Commodities Limitedand Transcorp Energy Limited.

     

  • Morison Industries lists 836.9m rights shares

    Morison Industries Plc has listed the supplementary shares that were allotted during its recent rights issue, rounding off the offer process for the N502.2 million rights issue.

    A total of 836.98 million ordinary shares of 50 kobo each were added to the shares outstanding in the name of Morison Industries. With the supplementary listing of 836.98 million ordinary shares of 50 kobo each, the total issued and fully paid up shares of Morison Industries has now increased from 152.18 million to 989.16 million ordinary shares of 50 kobo each.

    Morison Industries had raised N502.2 million new equity funds, providing the 63 years old health care company with the much-needed boost to reposition its operations.

    Morison Industries had late last year floated a new capital raising for about N502.2 million in new equity funds through new share sale to its shareholders. The company offered a rights issue of 836.98 million ordinary shares of 50 Kobo each at 60 Kobo per share on the basis of 11 new ordinary shares for every two ordinary shares of 50 Kobo held as at last August 25.

    GTI Securities Limited acted as the stockbroker to the supplementary share issuance while GTI Capital Limited was the issuing house. Both GTI Securities and GTI Capital are members of the GTI Group – a leading financial services group that owns the largest private trading floor in Sub-Saharan Africa (SSA).

    The allotment results for the rights issue approved by the Securities and Exchange Commission (SEC) showed that the rights issue was oversubscribed by 1.12 million ordinary shares as shareholders took up their rights and demanded for additional shares. As against 836.98 million shares placed on offer, shareholders placed orders for 838.11 million ordinary shares.

    GTI Capital Chief Operating Officer, Mr. Kehinde Hassan said the success of the rights issue had further confirmed GTI Capital’s pedigree of packaging companies to raise capital, irrespective of the macroeconomic and market conditions.

     

  • MRS Oil declares 20% bonus shares on N2.38b tax credit

    MRS Oil Nigeria Plc shareholders will receive a 20 per cent increase in their shareholdings after the board of the oil-marketing company decided to distribute bonus shares on the back of a N2.38 billion tax gain.

    The firm’s board stated that it had recommended the distribution of a bonus issue of one new ordinary share for every five ordinary shares held by shareholders as at the close of business on July 6.

    This implies distribution of 50.8 million ordinary shares to shareholders. After the listing, the bonus issue will increase MRS Oil Nigeria’s issued share capital from 253.99 million ordinary shares of 50 kobo each to 304.789 million ordinary shares of 50 kobo each.

    Key extracts of the audited report and accounts of MRS Oil Nigeria for the year ended December 31, 2017 showed that the company struggled with poor sales and declining margin during the year, ending the year with a pre-tax loss of N996.61 million. However, a tax write-back or gain of N2.38 billion in 2017 boosted the company’s net profit to N1.39 billion.

    The report showed that turnover dropped marginally from N109.64 billion in 2016 to N107.09 billion in 2017. Profit before tax reversed from N2.29 billion in 2016 to a loss of N996.61 million in 2017. Tax gain stood at N2.38 billion in 2017 as against tax provisions of N821.44 million in 2016. With these, net profit stood at N1.39 billion in 2017 as against N1.47 billion in 2016. Earnings per share stood at N5.45 in 2017 compared with N5.77 in 2016.

    Formerly known as Chevron Oil Nigeria Plc, MRS Oil Nigeria is owned by more than 24,000 shareholders. One of the major downstream oil companies, MRS Africa Holdings Limited (Bermuda) holds 60 per cent majority equity stake in MRS Oil Nigeria while Asset Management Corporation of Nigeria holds 10.47 per cent. Sundry Nigerian individuals and institutions hold the remaining 29.53 per cent equities.

     

  • CWG relapses with N1.58b loss

    CWG Plc recorded a net loss of N1.58 billion in 2017, relapsing into a losing streak that had seen the technological company with a pre-tax loss of N1.75 billion in 2015. Amid assurances of a sustainable rebound, CWG improved from a pre-tax loss of N1.75 billion in 2015 to profit before tax of N142 million in 2016.

    Key extracts of audited report and accounts of CWG for the year ended December 31, 2017 released at the weekend showed that turnover dropped from N10.166 billion in 2016 to N8.827 billion in 2017. The company recorded pre and post tax losses of N1.511 billion and N1.576 billion in 2017 compared with profit before tax of N142.04 million and profit after tax of N127.68 million in 2016.

    The board of directors of CWG, formerly Computer Warehouse Group, had earlier alerted the investing public that the technological company had suffered decline in performance and its earnings might be significantly lower than the previous reports.

    “The reduction in earnings is predominantly a result of losses incurred due to the financial cost implications of non-actualised projects which have adversely affected the company’s estimated earnings and year end projections,” the company stated.

    The company however assured that its profit margin has continued to remain stable , despite the decline in earnings.

    Chief Executive Officer, CWG Plc, Mr. James Agada, had assured that the company would build on its 2016 performance in 2017 as many initiatives would be activated to support the steady growth of the Company.

    He said the 2016 results reflected the continuing focus of the company on sustainable income streams, cost management and extraction of best value for the shareholders.

    According to him, in the face of the tough operating environment, the Group made a strategic decision to focus on profitable IT Solutions with less exposure to foreign exchange fluctuations and with predictable recurrent revenues.

    Agada said CWG was at the frontier of deployment of IT solutions adding that the company would continue to benefit as Nigerian public and private sector stakeholders adopt cutting-edge technologies.

    He noted that CWG has been working in partnerships with banks in deploying innovative technology-based products that enable customers’ access financial and other value added services through various mobile platforms while furthering the national goal of financial inclusion.

    He assured shareholders that the directors of the company would continue to chart the course of steady and sustainable growth with a view to ensuring good returns to Shareholders.