The Nation Newspaper

Category: Equities

  • Zenith Bank’s board meets on earnings, dividends

    Zenith Bank’s board meets on earnings, dividends

    • Joseph Sanusi retires from Lafarge Africa 

    Directors of Zenith Bank Plc are scheduled to meet tomorrow to review the financial statements of the bank for the year ended December 31, 2014.

    The board meeting is expected to consider the statement of accounts, the balance sheet, the reports of the auditors and the audit committee and other statutory reports.

    The meeting is also expected to consider the appropriate dividend to be recommended for payment to shareholders for the 2014 business year.

    Key extracts of Zenith Bank’s interim report and accounts for the nine-month ended September 30, 2014 showed that net profit rose marginally to N71.1 billion in 2014 as against N67.3 billion recorded in the comparable period of 2013. Profit before tax had however declined to N86.8 billion as against N106.2 billion recorded in the third quarter of 2013. Gross earnings stood at N273.7 billion as against N255.2 billion in comparable period of 2013. Loans and advances rose to N1.53 trillion as against N1.11 trillion while total liabilities and equity increased to N3.4 trillion in third quarter 2014 as against N2.9 trillion recorded in the corresponding period of2013. Shareholders’ funds meanwhile rose from N482.5 billion to N523.9 billion.

    Meanwhile, the former governor of Central Bank of Nigeria (CBN), Chief Joseph Sanusi has retired from the board of Lafarge Africa Plc. Sanusi’s retirement was ratified at the company’s board meeting last Thursday. The company has not made any replacement for Sanusi, who was a non-executive director.

    The Nigerian stock market closed on the upbeat yesterday as investors looked ahead to impending release of full-year earnings of quoted companies. With 27 gainers to 10 losers, aggregate market value of all quoted companies rose to N9.999 trillion as against its opening value of N9.953 trillion. The All Share Index (ASI), the common value-based index that tracks prices of all quoted companies, also trended upward to 30,018.35 points from its opening index of 29,882.28 points. The uptrend moderated the negative average year-to-date return to -13.38 per cent.

    Aggregate turnover was above average with the exchange of 396.8 million shares valued at N3.81 billion in 4,892 deals.

    Seven-Up Bottling Company recorded the highest gain of N6.50 to close at N157.20. Lafarge Africa followed with a gain of N2.01 to close at N86. Guaranty Trust Bank rose by N1.02 to close at N21.51. Nestle Nigeria added N1 to close at N805 while UACN Property Development Company rose by 86 kobo to close at N9.99.

    On the other hand, Nigerian Breweries recorded the highest loss of N3 to close at N146. Forte Oil dropped by N1.60 to close at N221.45. Dangote Cement declined by 70 kobo to close at N157. Union Dicon Salt Plc slipped by 69 kobo to close at N13.11 while Unilever Nigeria dropped by 32 kobo to close at N34.08 per share.

  • Nigerian equities open February with N106b gains

    Nigerian equities open February with N106b gains

    The Nigerian stock market opened yesterday on the upbeat as investors gained N106 billion. Aggregate market value of all quoted equities on the Nigerian Stock Exchange (NSE) recovered to N9.953 trillion in a tight trade that saw nearly as many gainers as losers. Market value of quoted companies had closed January at N9.847 trillion.

    The benchmark index at the NSE, the All Share Index (ASI), trended upward to 29,882.28 points from its opening index of 29,562.07 points. With 21 gainers to 22 losers, the overall market situation was boosted by gains by several large-cap stocks.

    Turnover was also above average as investors staked N3.25 billion on 254.84 million shares in 5,505 deals. Banking stocks dominated the activity chart with FBN Holdings leading the table with 24.04 million shares worth N170 million in 535 deals. Access Bank was the second most active stock with a turnover of 23.08 million shares worth N118.9 million in 139 deals. FCMB Group placed third with 22.71 million shares worth N45.59 million in 129 deals.

    Seplat Petroleum Development Company recorded the highest gain of N12.77 to close at N318. Nigerian Breweries followed with a gain of N6.98 to close at N149. Nestle Nigeria gathered N3.75 to close at N804. GlaxoSmithKline Consumer Nigeria added N2 to close at N42. Dangote Cement chalked up N1.70 to close at N157.70. Lafarge Africa rose by N1.44 to close at N83.99. Dangote Sugar Refinery added 69 kobo to close at N7.51. Guaranty Trust Bank garnered 46 kobo to close at N20.49. Oando rose by 21 kobo to close at N15.60 while Honeywell Flour Mills rose by 15 kobo to close at N3.15 per share.

    On the other hand, Forte Oil recorded the highest loss of N6.95 to close at N223.05. Seven-Up Bottling Company declined by N5.30 to close at N150.70. Presco dropped by N1.62 to close at N31.04. UAC of Nigeria slipped by 20 kobo to close at N37. Ecobank Transnational Incorporated dropped by 18 kobo to close at N16. Nigeria Aviation Handling Company lost 14 kobo to close at N4.66. Evans Medical dwindled by 11 kobo to N2.16 while Unilever Nigeria, Diamond Bank and Vitafoam Nigeria lost 10 kobo each to close at N34.40, N3.48 and N3.49 respectively.

    Meanwhile, the Securities and Exchange Commission (SEC) has alerted the investing public about the activity of an illegal fund known as “Energy Sector Credit Enhancement Fund” being promoted by Michelle-Vault Partners Limited.

    SEC yesterday stated that in order to convince unsuspecting investors of the authenticity of the purported fund, the promoters have misrepresented to the general public that the said fund is managed by major players in the Nigerian capital market.

    “The said “Energy Sector Credit Enhancement Fund” is not registered by the Commission and the promoter, Michelle-Vault Partners Limited is also not registered to perform any function in the capital market.  The purported fund therefore appears to be an outright fraud,” SEC stated.

    The apex capital market regulator warned the general investing public not to participate in the purported fund noting that any person subscribing to the purported fund or dealing with Michelle-Vault Partners Limited in any capital market related business is doing so at his own risk.

  • Stock Exchange gives deadline to brokers on VAT refund

    Stock Exchange gives deadline to brokers on VAT refund

    The Nigerian Stock Exchange (NSE) has given stockbrokers up till Friday, January 30, 2015 to submit documented evidence of refund of Value Added Tax (VAT) that were deducted between October 1 and 24, 2014 to investors.

    It should be recalled that the Federal Government had commenced the implementation of the exemption of commissions on stock market transactions from Value Added Tax (VAT) as from October 1, 2014. However, the announcement was delayed until late October.

    The exemption, which was first announced as part of measures to resuscitate the market in December 2012, was part of a basket of incentives outlined by Minister of Finance, Dr. Ngozi Okonjo-Iweala. She had on December 3, 2012, announced the exemption of stock market transactions from VAT and stamp duty. However, the implementation had dragged over the years. The stamp duty waiver, which was also announced in 2012, is yet to be implemented.

    The exemptions from VAT included commissions earned on traded values of shares, and those that are payable to the Securities and Exchange Commission (SEC), Nigerian Stock Exchange (NSE) and the Central Securities Clearing System (CSCS). The exemption is effective for a period of five years according to the Federal Government gazette on the issue.

    A circular obtained yesterday by The Nation indicated that the Exchange would commence the verification of the full refund of the VAT that were deducted within the delayed period between the announcement of the removal of VAT on Stock Exchange transactions and the release of the gazette.

    Stockbrokers had continued the deduction of VAT on transactions before the release of the gazette.

    Meanwhile, FBN Capital, the investment banking arm of FBN Holdings Plc, has predicted that the Nigerian equity market may close flat this year with average year-on-year gain of 1.0 per cent.

    Analysts’ report from FBN Capital noted that while the downtrend at the stock market has created attractive buy opportunities, investors might wait on the sideline as the macroeconomic outlook remained overshadowed by the decline in crude oil price.

    “The fall of the index in Lagos has produced buying opportunities in both banks and non-financials although we do not see a clear recovery until investors feel that the oil price has reached its floor. FBN Capital sees a 1.0 per cent gain for the index over the full year,” FBN Capital stated.

    The report noted that the rationale for investment remains firm household spending and the prospect of a renewed reform momentum once the electoral cycle has ended.

  • Access Bank gets SEC’s approval on N53b rights issue

    The Securities and Exchange Commission (SEC) has approved the plan by Access Bank to raise funds from existing shareholders, paving the way for the bank to open application list for the N52.6 billion rights issue.

    Access Bank Plc is offering about 7.63 billion ordinary shares of 50 kobo each at N6.90 to existing shareholders on the basis of one new share for every three shares held. Shareholders of the bank had approved the bank’s proposal to raise additional equity at an extraordinary general meeting in Lagos on October 13, 2014. Access Bank’s share price rose by 4.81 per cent to close at the Nigerian Stock Exchange (NSE) yesterday at N5.23.

    The bank said the capital raising falls in line with its five-year corporate strategy plan to be one of the top three banks in the country and the “world’s most respected African bank”. The strategy is anchored on four critical pillars including capital, human capital, governance and risk management.

    It added that the rights issue will also enable it to be more competitive and meet the funding needs of its blue chip customers that meet its credit risk criteria.

    Group managing director, Access Bank Plc, Herbert Wigwe said the proceeds from the offer will be used to upgrade the bank’s information technology platforms to enable it provide better services, upgrade the bank’s branch networks and further improve the working environment.

    “The funds raised would provide Access Bank with additional capacity to further consolidate its leading corporate banking business as well as additional capital headroom to support our increasing market share in the SME and retail segments,’” Wigwe said.

    According to him, in spite of the challenging conditions in the nation’s banking sector with regulatory changes and increased competition, Access Bank has continued to sharpen its execution skills, thereby ensuring a solid platform to build on.

    Access Bank Plc had launched a highly successful $400 million Eurobond in June 2014. The transaction followed the bank’s highly successful $350 million five-year senior debt issued in 2012. Access Bank is rated B (Fitch) and A+ Agusto & Co.

    Meanwhile, the Nigerian equity market started the week on a negative note as the benchmark index at the NSE, the All Share Index (ASI), declined by 0.11 per cent to close at 29,779.17 points. This worsened the average year-to-date return at -14.07 per cent.

  • Aiico, IFC in N3.4b convertible loan deal

    Aiico Insurance Plc and the International Finance Corporation (IFC) have opened discussions on a $20 million convertible loan deal that may see the global finance company holding substantial equity stake in the Nigeria-listed insurance company.

    Regulatory filing obtained at the weekend indicated that the IFC, the private sector arm of the World Bank, plans to extend $20 million, about N3.4 billion to Aiico Insurance.

    Under the arrangement, IFC has an option to convert any unpaid part of the convertible loan to equities in Aiico, referencing similar strategy that has seen IFC acquiring major stakes in many Nigerian financial institutions.

    Aiico’s share price rose by 4.0 per cent at the weekend to open today at 78 kobo. At current market valuation, the convertible loan deal could see IFC holding as much as one third of Aiico’s shareholding. Aiico’s issued share capital of 8.80 billion ordinary shares of 50 kobo each is valued at N6.86 billion.

    IFC had made similar arrangement to invest $12.5 million in Custodian and Allied Insurance Plc in 2012. The Custodian deal came through a 4.5 per cent convertible loan stock, an approximately N1.95 billion deal that allowed IFC to convert the debt stock into equities upon the terms of the agreement.

    IFC recently acquired additional 4.6 per cent equity stake in Ecobank Transnational Incorporated (ETI) Plc, the financial services holding group for all Ecobank banks, including Ecobank Nigeria Limited.

    ETI, which is listed on the Nigerian Stock Exchange (NSE), Ghana Stock Exchange (GSE) and the BRVM, Abidjan, issued more than 838.32 million ordinary shares of 50 kobo each to IFC, through convertible loan deals involving two funds being managed by the corporation.

    A document submitted to the NSE indicated that IFC acquired the shares through its managed funds-IFC ALAC Holding Company II and the IFC Capitalization (Equity) Fund LP.

    Under the deals, both funds converted convertible debts earlier granted to ETI to shares, with effect from July 1, 2014. The outstanding convertible loans of about $56.39 million for the IFC Capitalization (Equity) Fund LP and $18.10 million for the IFC ALAC Holding Company II were converted to some 628.74 million and 209.58 million ordinary shares of ETI respectively.

    Consequently, ETI issued 838.32 million additional shares, increasing its outstanding shares by 4.9 per cent from 17.21 billion ordinary shares of 50 kobo each to 18.05 billion ordinary shares of 50 kobo each. The conversions automatically reduced ETI’s convertible debts by $75.180 million.

    It should be recalled that IFC had in 2012, through these two managed funds and another fund-Africa Capitalisation Fund Limited, acquired 8.63 per cent equity stake in ETI. It had acquired 1.25 billion ordinary shares at agreed price of 8.0 cents per share, totaling $100 million, about N15.6 billion. ETI then had 13.24 billion ordinary shares outstanding. The supplementary listing of the additional shares issued to IFC increased total outstanding shares to 14.49 billion shares, giving IFC 8.63 per cent post listing.

  • Seplat gets new deadline on Afren acquisition

    Seplat Petroleum Development Company Plc has up till this weekend to make formal acquisition offer to Afren Plc, according to the latest update on the ongoing business combination between the two oil companies.

    The acquisition will consolidate the listing of Seplat on the Nigerian Stock Exchange (NSE) and indirectly brought the London-listed Afren to the Nigerian stock market.

    Regulatory filing at the NSE obtained by The Nation indicated that Seplat and Afren has started exploratory talks on possible merger and acquisition, although the deal is still at a very early stage and shroud in uncertainties.

    According to Rule 2.6(a) of the UK City Code on Takeovers and Mergers, Seplat was initially expected to make a firm offer for Afren on January 19, 2015 but it was unable to conclude the talks.

    Regulatory filing obtained at the weekend indicated that the board of Afren has received the consent of the UK Takeover Panel for an extension of the offer deadline up till 5.00 pm on January 30, 2015 to enable the parties to continue their ongoing discussions.

    By the weekend, Seplat must either announce a firm intention to make an offer for Afren or announce that it does not intend to make an offer for Afren, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies.

    However, the parties can still extend the new deadline with the consent of the Panel in accordance with Rule 2.6(c) of the Code.

    Seplat confirmed that it has made a highly preliminary approach regarding a possible combination with Afren. However, the company stated that there can be no certainty that an offer will be made or as to the terms of any offer.

    Afren, an international independent exploration and production company, has a premium listing on the London Stock Exchange (LSE) and it is ranked within the FTSE 250 Index. Seplat has dual listing on the NSE and LSE.

    Afren prides itself as a dynamic, entrepreneurial organisation with a portfolio of world-class assets located in many world’s most prolific and fast-emerging hydrocarbon basins in Africa and the Middle East. It has substantial operations in Nigeria.

    Afren’s activities span the full-cycle value chain of exploration, appraisal, development and production. It divides its operations into three core business units, Nigeria and other West Africa, Afren East Africa Exploration and the Kurdistan region of Iraq.

    In 2013, Afren’s exploration and appraisal campaign yielded remarkable results, with the play-opening discovery in OPL 310, offshore Nigeria, one of the largest discoveries in the world during the year.

  • Samuel Oni joins UBA board

    Samuel Oni joins UBA board

    The board of directors of United Bank for Africa (UBA) Plc has appointed former Central Bank of Nigeria (CBN’s) director, High Chief Samuel Oni, as a non-executive director of the bank.

    The appointment was made at the board’s meeting held on Friday, January 16, 2015. However, the appointment is still subject to the approval of the CBN.

    Oni joined the CBN as an Assistant Director in 1993 and rose to the position of Director, Banking Supervision in 2011.

     

  • We are focused on vibrant stock market, says Stanbic IBTC

    We are focused on vibrant stock market, says Stanbic IBTC

    The Stanbic IBTC Group is focused on helping to unearth the potential of the Nigerian capital market and building it into a vibrant and strong market.

    Chief Executive Officer, Stanbic IBTC Stockbrokers Limited, Oladele Sotubo, gave this assurance while commenting on the emergence of his company as the best stockbroker at the Nigerian Stock Exchange (NSE) in 2014.

    The NSE had named Stanbic IBTC Stockbrokers Limited, a member of the Stanbic IBTC Group, as the leading market operator in the Nigerian capital market. The stockbrokerage firm won the NSE Chief Executive Award as the best dealing member firm on the Exchange in 2014.

    The NSE CEO Award is an annual capital market award, in three sub-categories, that recognizes excellence and exceptional performance by market operators in a given year. The awards seek to reward outstanding contributions to the growth and development of the capital market and the Exchange.

    The award was based on Stanbic IBTC Stockbrokers’ trading activity during the year. Market data for 2014 showed that Stanbic IBTC Stockbrokers Limited achieved a turnover in excess of 24 billion shares, which represented 11.42 per cent of turnover volume at the NSE. The shares were valued at over N472 billion or 17.55 per cent of aggregate turnover value. IBTC Stockbrokers was also the largest stockbroking house in Nigeria in 2013.

    Sotubo said the Stanbic IBTC Group is committed to delivering innovative and timely financial solutions to the Nigerian and foreign investors.

    According to him, the award validates the appetite and growing capacity of the stockbroking firm, which is leveraging on the expertise of the Stanbic IBTC Group, to provide robust services in the capital market.

    He noted that the award and the recent listing on the Exchange of Stanbic IBTC Exchange Traded Fund (Stanbic IBTC ETF 30), are clear indications of the Stanbic IBTC Group’s focus on building a strong and vibrant stock market.

    “We are delighted to be recognized for our efforts and credible performances in the Nigerian capital market. The award reflects our strong commitment to consistently deliver relevant, innovative and timely solutions to our ever growing local and foreign clientele,” Sotubo said.

    He added that the increase in the broker’s market share is a bold statement that gives its  present and prospective clients more confidence to do business with it, assuring that the company will work harder to maintain that position as competition will continue to strive to take the lead from it.

    He said the award speaks to the company’s consistent performance and efforts to remain the best-in-class capital market operator pointing out the rich heritage of the Stanbic IBTC Group, a member of the Standard Bank Group, to which it belongs.

     

  • Oando extends N48.8b rights issue

    Oando extends N48.8b rights issue

    Oando Plc has secured a two-week extension for its ongoing rights issue as the Nigerian Stock Exchange (NSE) indicated that it would continue to offer the secondary trading platform for other investors that may want to buy into the rights issue.

    Oando is raising about N48.8 billion from existing shareholders through a rights issue of 2.217 billion ordinary shares of 50 kobo each at N22 per share.

    The offer, which was scheduled to close on Wednesday January 14, 2015, has now been extended till Wednesday January 28, 2015. The extension followed approval by the Securities and Exchange Commission (SEC).

    SEC had considered the public holidays during the offer period and decided to provide the investors with more working days to enable them participate fully in the rights issue.

    With the extension of the offer period, the management of the NSE yesterday stated that it would similarly continue trading on the Oando’s rights until January 28, providing investors with opportunity to buy the rights’ shares at the secondary market.

    Rights’ shares are usually pre-allotted to shareholders in the register of the company at a particular period. But both investors who are not pre-qualified for the rights issue can buy the renounced rights shares at the Exchange. Also, pre-qualified shareholders can demand for additional shares through their rights’ offer acceptance form.

    In similar issuance, Oando had in 2013 raised about N55.2 billion from a rights issue, slightly above the initial target of N54.6 billion. Allotment approved by SEC however showed that Oando succeeded in raising N55.2 billion, which many had said indicated the high level of investors’ confidence in the company.

    Third quarter report of Oando indicated that the company optimized its bottom-line performance as significant improvements in top and midline costs moderated decline in turnover and returned higher earnings to shareholders.

    Key extracts of the interim report and accounts of Oando for the nine-month period ended September 30, 2014 showed that while turnover dropped by 12.5 per cent, the group drew on improved input and marketing costs to grow gross profit and operating profit by 70.4 per cent and 97.3 per cent respectively. Net profit after tax rose by 75.7 per cent.

    Group turnover stood at N338.11 billion in third quarter 2014 compared with N386.25 billion in corresponding period of 2013. Gross profit meanwhile rose from N70.4 billion in 2013 to N79.60 billion in 2014. Operating profit also nearly doubled at N36.25 billion in 2014 as against N18.37 billion in 2013. Profit before tax rose marginally from N9.76 billion in third quarter 2013 to N10.18 billion in third quarter 2014.

    With tax gain of N523.4 million, group net profit rose to N10.70 billion in 2014 as against N6.09 billion in comparable period of 2013. Earnings per share meanwhile improved from 93 kobo to N1.26.

    Oando recently distributed a total of N2.4 billion as cash dividends to shareholders, consisting of a final dividend of 30 kobo per share for the 2013 business year financial year and an interim dividend of 70 Kobo per share for the six-month period ended June 30, 2014, bringing total dividend per share to N1.

  • NSE delists N18.8b Cappa & D’Alberto Nigeria

    After nearly six years of stalemate between the management of the Nigerian Stock Exchange (NSE) and Cappa & D’Alberto Nigeria Plc, the NSE at the weekend finally delisted the construction company from the its official list. Five companies were delisted from the NSE in 2014.

    With the delisting, shareholders of Cappa & D’Alberto will not be able to trade their shares on the NSE. However, they may trade their shares on the NASD, the over-the-counter (OTC) market for unlisted securities.

    The board of directors of Cappa & D’Alberto had in 2009 decided on the delisting of the company from the NSE pursuant to resolutions passed at an Extraordinary General Meeting of the Company held on 24 March 2009.

    The management of the NSE had kicked that Cappa & D’Alberto’s purported delisting violated laid-down procedures as the company failed to comply with the obligations inherent of a listed company with regards to the voluntary delisting process.

    According to the Exchange, Cappa & D’Alberto failed to make such provision for paying off dissenting shareholders who opted to exit the company following the resolution to delist passed by the majority shareholders on March 24, 2009.

    “The resolution passed by the majority shareholders at the Extra Ordinary General Meeting of March 24, 2009, does not exempt Cappa & D’Alberto Nigeria Plc from complying with regulatory obligations. The Exchange will take appropriate legal steps to enforce its rules and protect the interest of Investors,” the NSE had stated.

    But the management of the NSE at the weekend stated that it has agreed to delist the shares of Cappa & D’Alberto from the official list. Cappa & D’Alberto’s 198.875 million ordinary shares of 50 kobo each valued at N18.8 billion were delisted.

    “Henceforth, shareholders wishing to exit the company on account of its unlisted status may contact the company, which has undertaken not to unduly hinder such exits. Exiting shareholders may consider exiting through the over the counter market,” the NSE stated at the weekend.

    The NASD OTC was formally launched on July 1 and opened for trading on July 2, 2013. Formerly known as the National Association of Securities Dealers, NASD OTC is registered with Securities and Exchange Commission (SEC) as an over-the-counter (OTC) trading platform for unquoted securities; including equities and bonds.

    Major companies on the NASD included Dufil Prima Foods Plc, the manufacturer of Indomie Noodles; Friesland Campina Wamco Nigeria Plc, manufacturer of Peak Milk brand; Industrial & General Insurance Plc, Central Securities Clearing System Plc, the clearing and depository arm of the Nigerian Stock Exchange and Jaiz Bank Plc, the Islamic bank.

    Other stocks included Acorn Petroleum Plc, Arm Life Plc, Afriland Properties Plc, BGL Plc, Consolidated Breweries Plc, Food Concepts Plc, Geo-Fluids Plc, Golden Capital Plc, Niger Delta Exploration & Production Plc, Partnership Investment Company Plc, Resourcery Plc, Riggs Ventures West Africa Plc, Swap Technologies & Telecomms Plc and Trustbond Mortgage Bank Plc.