The Nation Newspaper

Category: Equities

  • Equities record modest recovery on bargain-hunting

    The Nigerian stock market yesterday heaved a sigh of relief from a sustained depression that had shaken the market to new low and dropped key indices below their psychological points. Investors turned round to take advantage of the depreciation in share prices, pumping up demand that triggered modest recovery in key indices.

    The All Share Index (ASI), the value-based common index that tracks prices of all quoted companies on the Nigerian Stock Exchange (NSE), recorded a modest day-on-day gain of 0.30 per cent to close at 28,221.75 points as against its opening index of 28,137.65 points.

    Aggregate market value of all quoted equities rose marginally by N29 billion from N9.670 trillion to close at N9.699 trillion. The modest recovery moderated the negative average year-to-date return to -18.57 per cent.

    While there were still more decliners than advancers, substantial rally within the highly capitalised group buoyed the overall market position. Guinness Nigeria topped the 20-stock gainers’ list with a gain of N5.49 to close at NN115.50. Mobil Oil Nigeria rose by N4.45 to close at N147.95. Julius Berger Nigeria added N1.85 to close at N43. Dangote Cement rose by 87 kobo to close at N166.02. Guaranty Trust Bank gathered 70 kobo to close at N20.70. Vitafoam Nigeria chalked up 40 kobo to close at N6.15. Dangote Sugar Refinery rose by 26 kobo to close at N6.60. Skye Bank added 19 kobo to close at N2.13. FBN Holdings rose by 17 kobo to close at N5.40 while Diamond Bank added 13 kobo to close at N2.89 per share.

    Turnover was around average with the exchange of 333.21 million shares worth N2.81 billion in 4,449 deals. Financial services stocks accounted for 196.64 million shares worth N830.8 million in 1,719 deals. Zenith Bank was the most active stock with a turnover of 59.52 million shares valued at N824.09 million in 377 deals. United Bank for Africa followed with a turnover of 52.5 million shares worth N157.44 million in 298 deals. Skye Bank placed third with a turnover of 44.01 million shares valued at N91.14 million in 198 deals.

    “The change in the market mood today can be attributed to renewed optimism in the some largely capitalized stocks trading at attractive prices. We acknowledge that this swing in the ASI is largely driven by bargain-hunting, hence we implore investors to continue to take position on value stocks with sound fundamentals,” Afrinvest Securities stated in post trading review.

    However, the market remained with a strong negative undertone. Thirty one stocks recorded price depreciation yesterday. Total Nigeria led the losers with a loss of N4.38 to close at N142.50. Flour Mills of Nigeria lost N2.56 to close at N23.76. PZ Cussons Nigeria declined by N2.24 to close at N20.87. CAP dropped by N1.95 to close at N37.05 while International Breweries declined by 83 kobo to close at N16.17 per share.

  • Cote D’Ivoire firm completes acquisition of Equity Assurance

    Sunu Assurances Vie Cote D’Ivorie, a leading Cote D’Ivoire insurance company, has completed the acquisition process for 28.2 per cent equity stake in Equity Assurance Plc, in a deal valued at N1.25 billion.

    The transfer of the equities to Sunu Assurances was done last week at the Nigerian Stock Exchange (NSE). Sunu Assurance acquired a total of 2.497 billion ordinary shares of 50 kobo each of Equity Assurance Plc, representing 28.2 per cent of the equity stakes held by Skye Financial Services and other shareholders of Equity Assurance.

    Equity Assurance, which is quoted on the insurance sector of the NSE, currently has total issued shares of 8.847 billion ordinary shares of 50 kobo each trading at its nominal value of 50 kobo, representing total market capitalisation of N4.42 billion.

    The transactions pushed Equity Assurance up as the most active stock for the week, with a turnover of 2.53 billion shares valued at N1.26 billion in 110 deals. The council of the NSE had earlier granted its “no-objection” to the acquisition.

    Sustained depreciation of share prices of Nigerian quoted companies has made several companies targets of acquisitions. The low valuation is prominent in the insurance sector, where most companies are trading at their nominal value of 50 kobo.

    The acquisition gave the Sunu Group a foothold in the Nigerian market. The group already has operations in 10 other African countries including Benin, Burkina Faso, Cameroon, Guinea, Gabon, Mali, Senegal, Niger and Togo.

    Sunu Life Insurance Côte d’Ivoire is the leading life insurance in Ivory Coast, with a turnover of over 24 billion CFA francs in late 2014. With focus on corporate and enterprise segment, Sunu Ivory Coast Life Insurance provides group pension products, group benefits and retirement benefits. It has also positioned as a leader in bancassurance and micro insurance simple with innovative products and operational efficiency.

    Members of the Sunu Group included Avie and Kajas. Avie, a member since 2005, is in the top three market life insurance companies with a steady increase in sales. It was the first vendor to develop bancassurance in active partnership with the banking sector in Benin and two thirds of banks operating in the country now have at least one life insurance product managed by Avie.

    Kajas Microfinance is a social purpose private company founded in June 2008 in Senegal. Its goal is to lead a sustainable and profitable business for socio-economic development of the people by allowing them to participate in income-generating activities and offering them access to decentralized financial services.

    The reinsurers to Sunu Group included SCOR in France, Africa Reinsurance in Nigeria and CICA-Re in Togo.

    Chairman, Equity Assurance Plc, Mr. Adetutu Buraimo, had hinted about the acquisition at the company’s 28th annual general meeting in Ijebu-Ode, Ogun State

    According to him, the company plans to seek for new equity investments from strategic investors.

    Shareholders passed a resolution to increase the company’s authorised share capital from N7 billion to N10 billion.

    The acquisition comes on the heels of recent rebound in the performance of Equity Assurance, which recovered from a loss of N365 million in 2013 with a profit of N310 million in 2014.

    He said the group recorded a total premium of N4.846 billion in 2014 as against N4.616 billion in 2013 while the company’s solvency also improved as shareholders’ funds increased by four per cent to almost N4 billion.

    He reiterated the commitment of the board to delivering return on investments to shareholders, adding that the company hopes to achieve this by driving market penetration and expanding its frontiers in retail.

    “New products will be developed to serve the needs of the insuring public, while more electronic distribution channels are being opened up to make its products more accessible to prospective policyholders,” Buraimo said.

    Equity Assurance was incorporated on December 13, 1984 and was licensed to underwrite all classes of general business. The company operates with a recently increased authorized share capital of N7 billion and shareholders fund of about N5.1 billion. The company is a corporate member of the West African Insurance Company Association (WAICA) and the Nigeria Insurers’ Association (NIA), the official umbrella of registered insurance companies in Nigeria, as well as The Africa Insurance Organisation (AIO).

    Equity Assurance Plc is the parent company of Equity Assurance Limited, a Ghanaian subsidiary that started operations in Ghana in 2008.

     

  • Equities lose N283b as banks, insurers slump

    It was another major rout for Nigerian equities last week as intense selling pressure dwarfed impressive corporate earnings and bargain-hunting by long-term investors to shave off N283 billion from quoted companies’ market capitalisation.

    Both the aggregate market value of quoted equities and the All Share Index (ASI), the value-based benchmark indices that tracks prices of all quoted companies on the Nigerian Stock Exchange (NSE), indicated a week-on-week decline of 2.69 per cent last week. The market had lost 2.34 per cent in the previous week.

    The downtrend last week further depressed the negative average year-to-date return at the Nigerian stock market to -13.79 per cent. With inflation at 9.2 per cent, inflation-adjusted return opens today at -22.99 per cent. The recession has been compounded by foreign exchange crisis and high cost of funds, which have kept many foreign and domestic investors on the sideline.

    With 61 losers, 11 gainers and 118 stagnant stocks, aggregate market value of all quoted companies on the NSE nose-dived to N10.241 trillion at the weekend as against its week’s opening value of N10.524 trillion. The ASI, which doubles as Nigeria’s sovereign stock market index, closed below its 30,000 psychological point at 29,878.33 points, 827.29 points or 2.69 per cent below its week’s opening index of 30,705.62 points.

    Price trend analysis showed that financial services stocks were the worst in the market-wide depreciation, losing nearly twice the average loss for the market. In spite of half-year earnings and interim dividends by banks, including Guaranty Trust Bank and Access Bank, the NSE Banking Index indicated a week-on-week decline of 4.46 per cent, the highest by any tracked sectoral group. The NSE Insurance Index trailed with a negative return of -4.41 per cent, an unusually large discount for an industry mostly trading at nominal values.

    All other indices showed widespread price depreciation across the sectors. The 40-stock NSE Pension Index, which has significant exposure to financial services stocks, dropped by 4.17 per cent. The NSE 30 Index, which tracks the 30 most capitalised stocks, and the NSE Industrial Domestic Index, which contains Dangote Cement, NSE’s most capitalised stock, mirrored the overall market position with average decline of 2.68 per cent and 2.69 per cent respectively. Losses by Oando and Seplat Petroleum Development Company pressured the NSE Oil and Gas Index to a negative close with average return of -2.73 per cent. The NSE Consumer Goods Index dropped by 0.39 per cent while the NSE Lotus Index, which tracks Islamic-compliant stocks, and the NSE ASem Index, which tracks second-tier stocks, declined by 0.20 per cent and 0.21 per cent respectively.

    Level of activities was above average, driven largely by acquisition trading in the insurance sub-sector and large-volume transactions in the banking sub-sector. Total turnover rose to 4.30 billion shares worth N20.05 billion in 20,219 deals last week as against a total of 1.36 billion shares valued at N12.48 billion traded in 17,867 deals two weeks ago.

    With the acquisition deal on Equity Assurance, the financial services sector accounted for 4.01 billion shares valued at N11.01 billion through 12,655 deals; representing 93.26 per cent and 54.91 per cent of the total equity turnover volume and value respectively. The conglomerates sector staged a distant second with a turnover of 106.98 million shares worth N342.65 million in 1,151 deals. The third place was occupied by the consumer goods sector with 53.38 million shares worth N4.69 billion in 2,856 deals.

    The trio of Equity Assurance Plc; Access Bank Plc, and United Bank for Africa Plc jointly accounted for 3.25 billion shares worth N4.08 billion in 2,830 deals, representing 75.53 per cent and 20.36 per cent of the total equity turnover volume and value respectively.

    The other non-ordinary shares segments continued to tag along. A total of 2,556 units of Exchange Traded Products (ETPs) valued at N981, 146 were traded in 17 deals last week compared with a total of 55,201 units valued at N2.905 million traded in 30 deals in previous week.

    At the Federal Government’s bond market, a total of 7,375 units of Federal Government’s bonds valued at N7.766 million were traded in seven deals last week in contrast with a total of 11,000 units valued at N12.346 million exchanged in four deals two weeks ago.

    Analysts at Financial Derivatives Company (FDC) said the market position had been worsened by many unimpressive corporate earnings. “The half-year 2015 earnings season commenced in the month of July and many listed companies released their corporate results for the period. In line with expectations, most results were unimpressive. Equity markets starved-off system liquidity as fixed income securities became the preferred investment instruments if investors,” FDC stated.

    Analysts at Afrinvest Securities said the market trend could remain unchanged in the meantime. “Given the sustained run of losses in the market and the absence of a catalyst to excite investors, performance is expected to be driven by speculations in the short term, thus, we advise investors to maintain medium to long term investment horizons,” Afrinvest Securities said at the weekend.

     

  • Investment One acquires new firms

    Investment One Financial Services Limited has acquired three new investment and finance firms to expand its bouquet of financial and investment products and provide investors with a one-stop investment point that caters to wealth creation and management.

    Head, Communications, Investment One Financial Services Limited, Aderayo Bankole, at the weekend said the company has recently completed three acquisitions to complement its organic growth and position the company as the fastest-growing investment company in Nigeria.

    The acquisitions included acquisition of Kakawa Asset Management Limited (KAML), a former subsidiary of Kakawa Discount House Limited. KAML is registered by Securities and Exchange Commission (SEC) as a corporate investment adviser and fund manager and it is also a dealing member and stockbroking firm at the Nigerian Stock Exchange (NSE).

    According to her, the acquisition of KAML brought its Kakawa Guaranteed Income Fund (KGIF) into the portfolio of bespoke investment products of Investment One and clients and unit holders of the company and fund will now benefit from the expertise and technical know-how of the Investment One stable.

    The acquired company and the mutual fund have both been rebranded to reflect the group; Kakawa Aseet Management Limited is now known as Investment One Funds Management Limited and the Kakawa Guaranteed Income Fund has been renamed Investment One Vantage Guaranteed Income Fund.

    Investment One Stockbrokers International Limited, a subsidiary of the Investment One Financial Services Limited acquired the stockbroking licence of KAML.

    Investment One stockbrokers had recently launched its “EasyTrade”, an online trading platform which facilitates access to trading on the stock market at the investing public’s fingertips. This new service allows investors place their buy and sell mandates on the go.  The subsidiary company also launched its mobile app which is available on android, and blackberry phones.

    “With the plan to optimize these recent acquisitions and the full offerings of the financial services group, Investment One is poised to provide excellent service to its current and potential customer base,” Bankole said.

    She pointed out that there is an emerging middle class segment with considerable disposable income, which is now the target of the company’s investment education activities which include free seminars for the general public.

    “We plan to extend our investment education, which currently covers the FCT, Lagos, Rivers, Kwara, Bayelsa, Imo and Oyo States, to other parts of the country. These investment education activities will inculcate investment consciousness and culture in the mind of the average Nigerian,” Bankole said.

    She noted that as a result of its innovative strategy and execution, the assets under management of the company have grown by 1145 per cent over a five-year period as the company continues to witness increasing clientele.

     

  • Dangote fails to lift market as equities lose 0.23%

    Dangote fails to lift market as equities lose 0.23%

    A last-minute rally by Dangote Cement Plc that staved off a negative market position on Tuesday failed to reenact the same scenario yesterday at the Nigerian Stock Exchange (NSE) as losses by several other highly capitalised stocks and ordinary stocks threw the market into the red.

    Dangote Cement, NSE’s most capitalised stocks had led 11 other small movers to override ostensibly negative market when 33 stocks lost relatively higher values than gainers on Tuesday.

    With 38 losers against five gainers yesterday and losses by several others highly capitalised stocks, the last-minute rally that propped Dangote Cement up by N3 failed to change the negative market position on Wednesday. Dangote Cement closed higher at N183 per share.

    The All Share Index (ASI), the benchmark index at the stock market, slipped by 0.23 per cent to close at 30,042.38 points as against its opening index of 30,112.62 points. Aggregate market value of all quoted equities also dropped from N10.321 trillion to close at N10.297 trillion, representing a loss of N24 billion.

    The downtrend yesterday further built the negative average year-to-date return at the stock market to -13.32 per cent.

    Turnover also dropped below average with the exchange of 299.7 million shares valued at N2.55 billion in 3,560 deals.

    GlaxoSmithKline Consumer Nigeria led the losers yesterday with a drop of N1.89 to close at N36.11. Cadbury Nigeria followed with a loss of N1.50 to close at N28.56. Okomu Oil Palm declined by N1.20 to close at N22.85. Forte Oil dropped by N1.08 to close at N218.90. Lafarge Africa lost 87 kobo to close at N100.63. Northern Nigeria Flour Mills dropped by 64 kobo to close at N12.19. Oando declined by 57 kobo to close at N10.83. Stanbic IBTC Holdings slipped by 42 kobo to close at N18. Guaranty Trust Bank dropped by 40 kobo to close at N22 while Union Bank of Nigeria lost 34 kobo to close at N6.95 per share.

    United Bank for Africa (UBA) was the most active stock with a turnover of 65.95 million shares with N211.86 million in 259 deals. Access Bank followed with a turnover of 39.13 million shares worth N162.9 million in 259 deals while Skye Bank placed third with a turnover of 30.42 million shares worth N53.93 million in 109 deals.

    Besides Dangote Cement, the four other gainers yesterday included Flour Mills of Nigeria, which rose by 10 kobo to close at N25.41; Paints Manufacturing Company, which added four kobo to close at N1 and Ecobank Transnational Incorporated and May & Baker Nigeria, which rose by three kobo each to close at N18.70 and N1.30 respectively.

  • Flour Mills to raise N30b from 1.1b rights shares

    •Acquires five subsidiaries

    Flour Mills of Nigeria Plc plans to raise N30.25 billion through a proposed rights issue as it moves to beef up capital base and streamline operations to mitigate macro-economic headwinds.

    The company  would be offering 1.09 billion ordinary shares of 50 kobo each to existing shareholders at N27.50 per share.

    A rights application filed by the  company at the Nigerian Stock Exchange (NSE) indicated that shareholders on register of the company as at the close of business last Wednesday would be pre-allotted five new ordinary shares of 50 kobo each for every 12 ordinary shares of 50 kobo each held.

    Chairman, Flour Mills of Nigeria, Mr. John Coumantaros, said the company would use the net proceeds to cushion the adverse effect of the sudden slump in global crude oil prices, which has resulted in major devaluation of the naira and caused increases in import costs and financial charges.

    Shareholders of the company last month approved resolutions authorising the company to increase its authorised share capital and raise about N40 billion new equity funds from existing shareholders.

    The extraordinary general meeting of shareholders increased the company’s authorised share capital from N2 billion to N2.5 billion through the creation of additional 1.0 billion ordinary shares of 50 kobo each. In the event of under-subscription, the board also received shareholders’ mandate to allocate unsubscribed rights’ shares to interested investors. Shareholders also empowered the board of directors to use net proceeds of the rights issue to meet the funding requirements of the company.

    In a related development, Flour Mills has received the approval-in-principle of the Securities and Exchange Commission (SEC) to acquire five of its subsidiaries in a major restructuring aimed at reducing costs.

    The five wholly-owned subsidiaries included Golden Noodles Nigeria Limited, Golden Transport Company Limited, FMN Cement Industries (Nigeria) Limited, New Horizon Flour Mills Limited and Quilvest Properties Limited. They will be merged with Flour Mills of Nigeria Plc. The restructuring is expected to be concluded in October 2015.

    Group Managing Director, Flour Mills of Nigeria, Mr. Paul Gbededo said the group was undertaking the restructuring to streamline its operations, reduce administrative costs, improve operating efficiency and derive full benefits of synergy in line with the company’s long term strategic thrust.

    According to him, after the completion of the restructuring, the enlarged company would be able to eliminate transfer costs of materials and operate at a higher level of efficiency, which will drive down costs, make product pricing more competitive, improve profitability and enhance the bottom line for the benefit of all stakeholders.

    Company Secretary, Flour Mills of Nigeria Plc, Alhaji Olalekan Saliu, said the management of the various companies had jointly obtained an order of the Federal High Court directing that a court ordered meeting of their respective shareholders be held on Wednesday, September 9, 2015 for the purpose of approving the restructuring.

    The company noted that where the shareholders give the requisite approval, the final approval of SEC would be sought and the Federal High Court will thereafter be approached to sanction the merger.

    Flour Mills distributed N5.51 billion, about 65.13 per cent of the company’s net profit, as cash dividends to shareholders for the immediate past year ended March 31, 2015. Shareholders received a dividend per share of N2.10 after proceeds from disposal of assets and tax gains helped the bottom-line to a positive close.

    Key extracts of the audited report and accounts of Flour Mills for the year ended March 31, 2015 showed visible decline in the operational performance of the company, but tax earnings boosted the net profit for the year.

    Total sales dropped to N308.76 billion in 2015 as against N325.79 billion in 2014. Gross profit also declined from N37.30 billion in 2014 to N35.37 billion in 2015. Operating profit slumped to N10.22 billion in 2015 compared with N19.38 billion in 2014. With decline in investment income from N5.03 billion to N2.3 billion and increase in interest expense from N16.10 billion to N18.70 billion, Flour Mills was primed for a loss during the year.

    However, the company’s bottom-line was mitigated by a N14.29 billion gain from disposal of investment from an associate company and a N738.3 million tax income gain. Profit before tax still closed lower at N7.72 billion in 2015 as against N8.23 billion in 2014. With the tax gain, profit after tax rose from N5.37 billion to N8.46 billion. Earnings per share thus stood at N3.47 in 2015 as against N1.93 in 2014.

    Flour Mills had recently embarked on group restructuring, strategic business acquisitions and investment in its core food business and backward integration programmes. It commissioned 750,000 metric tons per annual sugar refinery built at a cost of $250 million in April 2013.

    It has also continued to strategically invest in large scale commercial farming to support its food processing units with locally produced raw materials. The group had invested about N41 billion in capital projects in recent period including key projects such as flour capacity expansion in its Apapa mills, completion of Golden Snacks facility in Agbara, completion of Golden Sugar Refinery, establishment of new flour mill in Calabar, expansion of pasta & noodles lines and many major agro allied projects such as investments in Sunti Golden Sugar Estates and new animal feed mill and acquisition and development of large scale commercial farming.

  • Custodian and Allied pays N353m interim dividend

    Shareholders of Custodian and Allied Plc at the weekend received interim dividend of N353 million as the company’s pre-tax profit rose by 21 per cent in the first half.

    Shareholders on the register of the company as at the close of business last Friday, would receive interim dividend per share of 6.0 kobo.

    The dividend recommendation came on the heels of the company’s half-year results, which showed that profit before tax of N3.34 billion and profit after tax of N2.62 billion for the period ended June 30, 2015.

    Similarly, shareholders’ funds grew to N24.42 billion from N22.49 billion as at 31 December 2014, while total assets exceeded N54 billion as at 30 June 2015.

    The board of the company expressed optimism that the company would sustain the positive trend for the rest of the year, barring any unforeseen circumstances.

    Custodian is a leading non-bank financial institution with investments in life and non-life insurance, pension fund administration, trusteeship and property holding businesses. The Custodian Group consists of Custodian and Allied Plc-the holding company, Custodian and Allied Insurance Limited, Custodian Life Assurance Limited, Custodian Trustees Limited and Crusader Sterling Pensions Limited.

     

  • Fidson Healthcare records N477m profit in H1

    Fidson Healthcare Plc braced industry and macroeconomic headwinds to grow pre-tax profit to N477 million in the first half of 2015.

    Key extracts of the six-month report for the period ended June 30, 2015 showed that the company recorded a pre-tax profit of N477 million in 2015 as against N456 million recorded in comparable period of 2013. The report showed that turnover dropped by 12 per cent to N4.034 billion compared with N4.573 billion in the corresponding period of 2014. Earnings per share improved to 22 kobo as against 21 kobo in comparable period of 2014.

    The report meanwhile showed that a quarter-on-quarter growth in revenue of 128 per cent as sales returned to normal levels post-elections.

    The company noted that despite the year-on-year slowdown in sales, which was largely due to the prolonged general elections and transition period, margins improved over the first six months, driven by the company’s cost optimisation drive.

    Operating expenses dropped by 67 per cent from N150 million in 2014 to N49 million in first half 2015, with selling and distribution expenses also decreasing from N605 million to N325 million, a decline of 46 per cent.

    Fidson, which recently emerged as the recipient of the Frost & Sullivan 2014 Growth Excellence Leadership Award in the Nigerian pharmaceutical industry, continues to gear up for the commissioning of its World Health Organisation (WHO) Good Manufacturing Practice (GMP) compliant plant, where it would manufacture IV fluids in addition to existing product offerings. The new plant is scheduled to be operational before the end of 2015 and is expected to broaden Fidson’s product base and increase its capacity.

    Fidson’s growth opportunities have also recently been enhanced by the announcement of its partnership with Immune Therapeutics Inc, a United States (US) public company to market “LodonalTM” in Nigeria. “LodonalTM” is a patent-protected product that is indicated for the management of patients with immune-compromise.

     

  • Berger Paints’ new CEO unfolds growth plan

    Berger Paints’ new CEO unfolds growth plan

    THE new Managing Director  of Berger Paints Nigeria, Peter Folikwe, has outlined the company’s strategic growth plan aimed at enhancing shareholders’ value.

    Folikwe, who assumed office in March, said Berger Paints has modernised and upgraded its production with the acquisition of new machinery that will position the Nigerian company as one of the best paints manufacturers in Sub-Sahara Africa.

    He said recent investments in new production facilities, human resources and innovation were all aimed at enhancing the company’s earnings and shareholders’ value.

    According to him, the new production facility is designed to produce top quality and innovative products at reasonable prices, which will help the company to reduce inefficiency and increase the company’s turnover and market share.

    “Specifically, we are on the track to build the first automated paint manufacturing plant in the Sub-Sahara Africa. When completed, it will revolutionise our production and distribution processes, enhance product quality and delivery and reinforce our competitive edge,” Folikwe said.

    He assured that Berger Paints would continue to uphold the sanctity of the post listing requirements of the NSE, which place premium on full disclosure at all times, adding the management of the company is committed to creating better returns for shareholders.

    In his remarks, Chief Executive Officer, Nigerian Stock Exchange (NSE), Mr Oscar Onyema commended the board and management of Berger Paints for sustaining a long legacy of corporate excellence.

    He urged the company’s management to uphold the highest standard of corporate governance in order to be on the Exchange’s Premium Board Index for companies that excel in corporate governance.

    Folikwe spoke during a visit to the NSE, during which he also performed the ceremonial ringing of closing bell for the stock market.

    He had earlier assured shareholders of Berger Paints that the company would sustain its profitability, noting that the performance of the company in the first half of 2015 indicates that the company has been waxing stronger despite the harsh operating environment for manufactures in Nigeria.

    He pointed out that the company is setting up a multi-billion Naira factory to expand its operations while working on innovative products that would not only appeal to Nigerian consumers, but the entire global markets.

    Folikwe reiterated that his pre-occupation is to drive Berger Paints as a brand whose products would continue to define quality and acceptability in Nigeria.

    In a related development, Folikwe called on the government to support the development of the Nigerian real sector by providing enabling environment for manufacturing companies to thrive.

    He said Nigerian manufacturers are contending with several obstacles, which have reduced their competitiveness and limit their growth potential.

    Folikwe urged the Federal Government to address the issues of foreign exchange rate, infrastructural deficit, multiple taxation and enforcement of enabling rules by the Standard Organisation of Nigeria (SON) in order to create the much-needed enabling environment for businesses to thrive.

    “The real sector is the major sector that can drive economic growth and development. But in Nigeria, the sector has consistently suffered a setback in the scheme of things.

     

     

    The sector is bedeviled with myriad of issues which include infrastructural deficits such as bad road, epileptic power supply, multiple taxation, Naira exchange rate volatility and the extent to which the Standard Organisation of Nigeria (SON) is actually tracking and sanctioning those who compromise standard in their product quality. All these increase production cost and force producers to pass the cost to consumers who are already struggling with weak purchasing power. Government should address these issues without further delay,” Folikwe said.

    He added that efforts should also be geared towards instituting a virile consumer advocacy framework in order to promote culture of quality products among manufacturers.

    According to him, quality products are necessary condition for competitiveness in the global market and it enhances consumers’ loyalty and higher turnover.

    He said Nigeria would compete more favourably in the global market if the country leverage on consumer advocacy approach through which consumers of products are made to know that while inferior products appear cheap, they are actually more expensive than quality products in the area of durability and utilitarian value.

     

     

  • Zenith Bank declares N7.85b interim dividend

    Zenith Bank declares N7.85b interim dividend

    The board of Zenith Bank Plc has recommended distribution of about N7.85 billion as interim dividend to shareholders of the bank, setting a new path with its first-ever interim dividend.

    A dividend recommendation released yesterday at the Nigerian Stock Exchange (NSE) indicated that shareholders would receive an interim dividend of 25 kobo per share. The qualifying date for the dividend is August 21, 2015 while the register will close on August 24, 2015.

    The first-ever interim dividend highlighted considerable improvements in the earnings of the bank in the first half. Zenith Bank recently adopted a new financial reporting policy of publishing audited half-yearly results.

    Key extracts of the six-month audited report and accounts for the period ended June 30, 2015 showed that gross earnings rose by 24 per cent from N184.4 billion in June 2014 to N229.08 billion in 2015. Net interest income grew by 14 per cent from N98.6 billion in 2004 to N112.6 billion for the period ended June 30, 2015.

    Group profit before tax increased by 24 per cent from N58 billion to N72 billion while profit after tax rose to N53 billion as against N47 billion in 2014. Customers’ confidence in the Zenith Bank increased during the period under review as deposits rose from N2.5 trillion to N2.6 trillion, just as total assets stood at N3.8 trillion in 2015 as against N3.7trillion in 2014. Gross loans and advances grew by 10.4 percent without compromising the asset quality as evidenced by a best-in-class low cost rate of 0.8 percent, which is below industry average non-performing loan (npl) ratio of 1.44 percent.

    The bank’s outstanding service delivery has won numerous international endorsements and awards, including Best Bank in Corporate Governance in Nigeria by Global Banking and Finance (2015), Best Customer Service Bank in Nigeria by Global Banking and Finance (2014) and the Most Customer-Focused Bank in Nigeria by KPMG (2014).

    The bank only recently scored another first, becoming the first Nigerian institution to be awarded a triple ISO certification by the British Standards International (BSI): the ISO 22301, 27001 and 20000 standards.

    The bank had stated that the three standards, which require the bank to subscribe to internationally accepted principles and standards, will deepen customer experience through greater information security and information technology management system that emphasize the protection of the customers and their investments in an increasingly unpredictable business environment.