The Nation Newspaper

Category: Equities

  • Oando, WEF harps on transparency as mainstay for sustainable growth

    Oando, WEF harps on transparency as mainstay for sustainable growth

    Oando Plc and the Partnering Against Corruption Initiative (PACI) of the World Economic Forum (WEF) have stressed the importance of ethical and transparent business dealings as key elements for sustainable corporate and national growth.

    At a breakfast meeting held on the sidelines of the ongoing WEF, top executives of Oando, WEF and other stakeholders explored the theme of inclusive growth and the role business transparency has to play in achieving this.

    PACI is a global, multi-industry, multi-stakeholder anti-corruption initiative set up by the World Economic Forum (WEF) to raise business standards and to contribute to a competitive, transparent, accountable and ethical business society. Since its inception in 2004, the PACI principles have served as a call to action for businesses around the world to commit to zero tolerance of corruption in all its forms. Oando became an active member of PACI in 2008.

    Senior director and head, Centre for Global Industries, World Economic Forum (WEF), Mr. Alex Wong noted that transparency makes businesses to be more resilient and risk free.

    According to him, a community of chief executives who are committed to a business society free from corruption would give rise to sustainable growth within their companies, industries and countries.

    Group chief executive, Oando Plc, Mr. Wale Tinubu also underlined the importance of ethical business practices in the global business environment urging government to do more in creating a corrupt free business environment.

    “There’s clearly a new world order, companies need transparency to grow and raise capital, and the world demands it in everything. Corruption is no longer fashionable,” Tinubu said.

    Chief compliance officer, Oando Plc, Ms Ayotola Jagun noted that Oando’s involvement in anti-corruption initiatives has played a major role in the company’s success story.

    She pointed out that a more collaborative action is the viable means of fighting corruption and changing the business landscape in Nigeria.

    She cited Oando’s involvement in local anti-corruption initiatives and global campaign as evidence of the company’s commitment as an active member and advocate for ethical and transparent business environment.

    The breakfast meeting was also used for the soft launch of the Clean Business Practice Initiative (CBPI), an indigenous private sector-driven anti-corruption body set up to compliment government efforts in fighting corruption in Nigeria. By committing to develop and implement anti-corruption practices in institutions, systems and processes, the initiative aims to help level the playing field in trade, commerce and industry.  Jagun is a member of the board of CBPI.

  • Equities rally on oil and gas, manufacturing gains

    Equities rally on oil and gas, manufacturing gains

    The bullish rally at the Nigerian Stock Exchange (NSE) picked up yesterday as investors continued bargain-hunting in the oil and gas and manufacturing sectors.

    For the second consecutive trading session, equities sustained a cautious but positive outlook with more gainers than losers and above average turnover. The All Share Index (ASI), the benchmark index for the Nigerian stock market, rose by 0.28 per cent, underlining addition of N35 billion in capital gains to the aggregate market value of all quoted equities.

    The ASI closed higher at 38,585.99 points as against its opening index of 38,480.07 points. Aggregate market value of all quoted companies also improved from N12.668 trillion to N12.703 trillion. The modest gain yesterday reduced the negative average year-to-date return to -6.64 per cent.

    The positive market situation was driven largely by gains recorded by major companies in the oil and gas and manufacturing sectors. SEPLAT Production and Development Company led the bullish stocks with a gain of N33.13 to close at N696.12. Mobil Oil Nigeria followed with a gain of N8.50 to close at N123.50. Guinness Nigeria rose by N3.98 to close at N180. Lafarge Cement Wapco Nigeria added N1.97 to close at N111.99. Nigerian Breweries rose by N1.28 to close at N150. GlaxoSmithKline Consumer Nigeria and Total Nigeria chalked up 50 kobo each to close at N70 and N153 respectively. Zenith Bank added 40 kobo to close at N22.90. Beta Glass rose by 31 kobo to N18.90 while National Salt Company of Nigeria garnered 26 kobo to close at N12.09.

    Total turnover stood at 321.98 million shares valued at N3.24 billion in 3,959 deals. Transactions remained concentrated in the financial services sector with investors swapping 268.49 million financial shares worth N1.61 billion in 2,120 deals.

    Continental Reinsurance was the most active stock with a turnover of N99.06 million shares worth N97.08 million in six deals. Access Bank was the second most active stock with 31.41 million shares valued at N284.05 million in 172 deals. Guaranty Trust Bank placed third with a turnover of 18.2 million shares worth N482.1 million in 230 deals.

    On the downside, CAP recorded the highest loss of N1.35 to close at N39. Dangote Cement followed with a loss of N1.28 to close at N224.64. Julius Berger Nigeria lost 90 kobo to close at N68.50. Jos International Breweries slipped by 17 kobo to N3.42. Fidson Healthcare dropped by 13 kobo to N2.36 while Dangote Sugar Refinery lost 10 kobo to close at N9.20 per share.

  • “Increase foreign investments will benefit capital market”

    The Association of Assets Custodians of Nigeria (AACON) has underlined the importance of creating conducive environment for foreign direct and portfolio investments with a view to deepening the Nigerian capital market.

    President, Association of Assets Custodians of Nigeria (AACON), Mr. Segun Sanni, said  increase in foreign investments would lead to improvements in the processes, technology and standards in the Nigerian capital market.

    According to him, it is important for Nigeria to attract more of the over $120 trillion of investment under custody globally as foreign portfolio investment is important to the economic development of all countries.

    “We have over $120 trillion under custody all over the world and we have just about $1 trillion of that invested in Africa,” Sanni said.

    He outlined several benefits of foreign investments to include cross-border experience and high corporate governance standards.

    “The first benefit is that when foreign investors invest in your market, obviously they bring in foreign exchange. The second benefit is that by their very nature, since they are foreign investors and they operate in various markets with different high standards of performance and high standards of governance, foreign investors tend to bring progress to the market because they ask for one improvement or the other in the way things are done. Therefore, when foreign investors invest in the market, they bring improvement to processes, technology and all that,” Sanni said.

    He added that foreign portfolio investors were also capable of boosting confidence in a market.

    He said the association had come up with an annual conference to give the Nigerian capital market more visibility, while also ensuring that it develops in line with the aspirations of foreign portfolio investors – which were based on international standards.

    In line with its efforts to help the country attract more foreign portfolio investment, Sanni said the third edition of the association’s annual conference, scheduled to take place in London on May 28, would involve all stakeholders in the capital market.

    According to him, the Acting Governor, Central Bank of Nigeria, Dr. Sarah Alade; and the Director-General, Securities and Exchange, Commission, Ms. Arunma Oteh, are among stakeholders that have confirmed that they will attend conference, which has the theme, ‘Nigeria: Road to emergence.’

    He said the Statistician General of the Federation and Chief Executive Officer, Nigerian Bureau of Statistics, Dr. Yemi Kale, would also be in attendance to talk about the rebasing exercise that led to Nigeria’s emergence as Africa’s largest economy and what the development portends.

    The vice president, Association of Assets Custodians of Nigeria (AACON), Mrs. Kemi  Adewole, added that the conference would also give the association and speakers from Nigeria the opportunity to talk about changes that have taken place in the market and how the investors can take advantage of them.

    She noted that the association opted to hold the conference in London because it was more accessible to foreign investors.

    “The real thought behind having this event, which investors now look forward to at least once in a year, is that there is so much negative publicity on Nigeria, but then within the capital market there are actually a lot of positive developments and if we don’t take these information to them, they may not know what we are doing,” Adewole said.

    Adewole said beyond just informing them of the development in the market, as agents to the investors, the custodians also used the event to get feedback, which has been very useful in the development of the market.

  • Peugeot share issue underway as new board meets

    Peugeot share issue underway as new board meets

    French carmaker PSA Peugeot Citroen launched the second stage of a long-awaited three billion euro, about $4.2 billion, capital increase to fund its “Back in the Race” recovery plan and tie-up with China’s Dongfeng .

    As its new board met on Tuesday, the troubled firm surprised markets by issuing more stock than expected at a larger discount to raise 1.95 billion euros from existing shareholders.

    Peugeot shares surged in afternoon trading, outpacing a broader European stock rally on hopes that recovering regional demand can help the recapitalized carmaker rebound.

    The rights issue, in addition to a 1.05 billion stock sale to the French state and Dongfeng Motor Group, allows investors to purchase seven new shares at 6.77 euros for every 12 held, a 41 per cent discount to Monday’s comparable closing price.

    That means future dividends will be divided among 877 million outstanding shares, a greater number than many analysts had anticipated.

    “Our share price target is likely to halve on the back of this transaction,” said Mike Dean of Credit Suisse.

    The extent of existing shareholders’ dilution is “further negative news for Peugeot following an underwhelming ‘Back in the Race’ presentation,” the London-based analyst said.

    But the stock reacted positively, building on tentative morning gains to close at 12.73 euros – a 10.6 percent advance excluding the mechanical effect of a parallel warrants issue that had cut the price by 1.53 euros overnight.

    The rally was “probably a reflection of people being relieved” at the company’s refinancing progress, said Erich Hauser of ISI Group, which had trimmed its Peugeot rating to “neutral” from “strong buy” following the February 14 strategy presentation by new Chief Executive Carlos Tavares.

    The former Renault second-in-command has pledged to simplify model lineups and slash production costs in pursuit of a 2 percent operating margin goal for 2018, rising to 5 per cent by 2023.

    The capital hike will see the French government and state-owned Dongfeng each acquire 14.1 per cent of the carmaker, which posted more than seven billion euros in net losses for 2012-13, as well as take two board seats each.

    Meeting for the first time on Tuesday under new Chairman Louis Gallois, the board named his predecessor Thierry Peugeot as one of three vice-chairmen, alongside representatives of Dongfeng and the French state.

    Peugeot said the rights issue subscription period would run from May 2-14, underwritten by a syndicate led by BNP Paribas, Morgan Stanley and seven other major banks. Settlement, delivery and listing of the new shares will take place on May 23.

    The deal terms imply that Peugeot shares would be valued at seven times forecast 2015 earnings after the capital hike, compared with a multiple of 4.1 beforehand, Paris-based brokerage Exane said.

  • Violence may hamper foreign investments, says Guinness MD

    Violence may hamper foreign investments, says Guinness MD

    Managing director, Guinness Nigeria Plc, Seni Adetu, has expressed fears that a recent wave of deadly bomb attacks and kidnappings by militants may deter foreign investment in Nigeria.

    The fear is the impact on “potential foreign investors currently sitting on the fence and waiting for the right time to come to Nigeria,” Adetu said in an interview with Bloomberg in Abuja the capital, in advance of the World Economic Forum in Africa. “Its massively of concern to me, first as a Nigerian and secondly as a Nigerian businessman.”

    Executives from around the world are arriving at the forum as Africa’s biggest oil producer faces one of the worst rounds of violence in the capital in recent history. More than 90 people have been killed in separate bomb attacks in the past month just miles from where the conference is taking place, while U.S. President Barack Obama has pledged help to find more than 200 students who were abducted following a raid on an all-girls secondary school by gunmen on April 14.

    The spread of violence carried out by the militant group Boko Haram from its base in the northeast of Nigeria has raised the level of concern for local companies as well as foreign investors, according to Adetu.

    “Up until now you always thought that it was restricted to the northeastern part of the country,” he said. “From a business standpoint, you just thought you could deal with that, but I think coming closer to Abuja, as we have seen in the last two weeks, has sort of changed the perspective around the insurgency.”

    Nigeria, Africa’s most populous country with about 170 million people, has enough economic potential to continue to attract some level of foreign investment, Adetu said. Lagos-based Guinness Nigeria, a unit of London-based Diageo Plc (DGE), remains committed to the market, he said.

    “I still believe that in totality, on account of the economic opportunity in Nigeria, it’s still the right place to come and invest,” he said.

  • UBA Capital, NSE, LSE, JSE, TSX explore dual listings for oil, mining firms

    UBA Capital, NSE, LSE, JSE, TSX explore dual listings for oil, mining firms

    Major African and global stock exchanges have initiated discussions on the prospects and opportunities for Nigerian oil and gas and mining companies to list their shares on the Nigerian Stock Exchange (NSE) and other international stock exchanges.

    At an interactive session organized by UBA Capital, officials of three major international stock exchanges: Johannesburg Stock Exchange (JSE), London Stock Exchange (LSE), and Toronto Stock Exchange (TSX) and top management of the NSE held discussions with select companies in the oil and gas sector and mining industry on the opportunities in dual listing.

    Senior Manager, primary markets, London Stock Exchange (LSE), Darko Hajdukovic, said LSE could help African companies seeking listing to de-risk the process and enhance their valuation noting that London offers a very cost effective option among major stock exchanges.

    According to him, LSE has a long experience of listing companies from Africa with its main market currently having 42 listed African companies with total market capitalization of $239 billion.

    Business development manager, Johannesburg Stock Exchange (JSE), Tamsin Freemantle, outlined that dual listing offers companies larger and complimentary pools of capital, increased visibility, increased liquidity through two pools of liquidity on the home and secondary exchanges and access to capital from emerging market focused funds.

    She noted that 86 companies listed on the JSE have dual listings while JSE has been able to achieve average market liquidity of between 40 per cent and 50 per cent since 2010.

    In the same vein, head, business development, Europe and Africa, Toronto Stock Exchange (TSX), Graham Dallas, said TSX offers Nigerian oil and gas companies the best opportunities to have access to the largest community of listed peers.

    According to him, TSX is the number one exchange in the world by the number of listed oil and gas companies as well as listed mining companies while it also hosts the highest number of oil and gas analysts among world stock exchanges.

    He pointed out that in 2013, oil and gas companies raised $5.2 billion on the TSX with $789 million raised for oil and gas companies covering projects in Africa.

    According to him, TSX has competitive advantages in dual listing because of its superior access to capital especially for small companies, tailored listing rules for oil and gas companies, availability of TSX staff with specialized knowledge in oil and gas matters and rules to facilitate fast capital raising, strong energy trading liquidity, vibrant retail and institutional investor base and a strong equity culture among Canadians with 50 per cent of the Canadian population owning stocks.

    In her remarks, general manager, listings, sales and retention, Nigerian Stock Exchange (NSE), Taba Peterside, urged the oil and gas companies to take advantage of the increasing visibility and interest in the Nigerian economy to list their shares.

    She noted that 48 per cent of the funds raised by the Seplat dual listing were raised from local shareholders underpinning the importance of local investors when listing a Nigerian company on any exchange.

    Partners from the international law firms Jones Day and Freshfields Bruckhaus Deringer LLP however, stressed the need for appropriate corporate governance structures to be put in place well before a company approaches the international markets.

    Group chief executive officer, UBA Capital, Oluwatoyin Sanni, said UBA Capital would support capital raising aspirations of African issuers while simultaneously creating attractive and accessible investment opportunities for investors.

    According to her, UBA Capital will continue to partner with credible regional and international institutions as it pursues its strategic intent to build Africa’s leading integrated financial services group.

    Managing director, investment banking, UBA Capital, Wale Shonibare,  noted that UBA Capital Plc is well-positioned to support fast-growing mining companies and their oil and gas counterparts to raise the much needed equity capital from local and international sources.

     

  • Dangote Cement: Dangote, shareholders pocket N119b dividend

    Dangote Cement: Dangote, shareholders pocket N119b dividend

    •Dancem increases capacity, delivery to stabilize cement price

    Alhaji Aliko Dangote, the founder and owner of Dangote Industries Limited (DIL), and other minority shareholders in Dangote Cement (Dancem) Plc at the weekend shared about N119.3 billion as dividends from the N201 billion profit made by their company in 2013.

    At the annual general meeting of Dancem at the weekend, shareholders approved the annual reports and accounts for the year ended December 31, 2013 including 133 per cent increase in cash payouts to shareholders. Dangote and other shareholders are expected to receive their warrants or cheques for the dividends today.

    A breakdown of the dividend distribution indicates that Dangote would receive the largest chunk of N110.7 billion through Dangote Industries Limited, which holds 92.81 per cent equity stake in Dancem. Dangote will personally receive N193.48 million as dividends registered in his personal names. Other shareholders would share about N8.6 billion.

    According to the breakdown, shareholders would receive a dividend of N7 on every share. Dancem has 17.04 billion ordinary shares of 50 kobo each with DIL holding about 15.816 billion ordinary shares of 50 kobo each. Dangote personally holds 27.64 million ordinary shares of 50 kobo each.

    The increased dividend came as the company witnessed impressive growths in sales and profit in 2013. Key extracts of the audited report and accounts of Dancem for 2013 showed that group turnover rose by 29.4 per cent from N298.45 billion in 2012 to N386.18 billion in 2013. Pre-tax profit rose by 40.6 per cent from N180.15 billion to N243.66 billion. Profit after tax rode on the back of tax credits to N201.2 billion in 2013 as against N145.02 billion in 2012.

    Addressing shareholders at the meeting, Dangote assured that the company’s prospects remains robust citing increasing domestic demand and opportunities for exports to other African countries.

    He said the company plans to add 9.0 million metric tonnes to its capacity by the end of 2014 to increase cement supply and saturate the market in order to stop activities of profiteers who allegedly are behind cement price increase.

    He said Dancem would intensify direct-to-consumer deliveries as a means of stabilizing the price of cement noting that Dancem sold 13.3 million tonnes of cement in Nigeria within the financial year representing an increase of 28.2 per cent over sales recorded in 2012

    Dangote insisted that Dancem has not increased the price of its cement in spite of increase in prices of most inputs into cement production in demonstration of the company’s commitment to making cement available to Nigerians at reasonable price.

    “Trading remains robust in Nigeria and we have experienced a solid start to the year with demand up in all regions,” Dangote said on the outlook of the company in 2014.

    According to him, the company had recently introduced 52.5 strength cement, which is appropriate for heavy load-bearing structures such as bridges and flyovers, through which it hopes to increase its market share in the short-term by increasing the level of direct-to-customers deliveries and competing on product superiority.

    Dangote also informed the shareholders the status of the company’s various African projects as the shareholders one after another shower commendations on the management of the cement company.

    “In Ethopia, work is well underway, to build 2.5m mtpa plant at Mugher with production expected late in 2014. In Tanzania, we have begun work on a 3m mtpa plant at Mtwara and would be fully operational in 2015. In Zambia, work is underway on a 1.5m mtpa at Ndola with cement production expected in second half of 2014. “We are reviewing plans for Kenya with a view to increasing the scale of our proposed factory from 1.5 to 3.0m tpa, because we are confident there will be sufficient demand both in Kenya and neighbouring countries, “ Dangote said.

    Group managing director, Dangote Cement Plc, Devakumar Edwin, attributed the impressive results of the company to focused and strategic management.

    He outlined that the company’s direct-delivery strategy is proving very popular with customers with this initiative now accounting for more than half of total sales.

    “We increased our margins despite continuing disruption to our gas supply and believe that the gas distribution infrastructure will be more robust in 2014, enabling us to improve our margins even further. At the same time we are looking at ways to diversify our fuel supplies to mitigate the impact of any future disruption and reduce the cost of using alternative fuels to gas,” Edwin said.

    He added that the company would next year open many of its factories across Africa to further realize its aim of being Africa’s leading cement producer and generate strong and sustainable returns for shareholders.

  • NSE promotes corporate ethics

    NSE promotes corporate ethics

    The Nigerian Stock Exchange (NSE) in partnership with key publicly quoted companies will be holding the 1st NSE Corporate Challenge. The one-day event which is scheduled to take place in Lagos on Saturday, May 17, 2014 will be a highly competitive and fun-filled five kilometre walk, run or jog competition to promote and support teamwork, company pride and corporate wellness. The competition is open to the broker dealer community and companies listed on the NSE.

    Head, corporate services, Nigerian Stock Exchange (NSE), Mr Bola Adeeko, in a statement, stated that the idea behind the corporate challenge is for responsible organisations and their employees to take part in the initiative as a way of enhancing employee-employer relations and boost goodwill by bringing all together for fun, fitness and fellowship.

    According to him, the inaugural NSE Corporate Challenge is a professionally organised and volunteer-driven initiative involving over 350 companies listed on the Exchange and support organisations from the capital market community.

    He said the NSE would be working in close partnership with public and private sector organisations such as the Lagos Island Central Business District, First Bank of Nigeria, Unilever, Unity Bank, Nestle Nigeria, Malta Guinness and First City Monument Bank among others.

    “The Corporate Challenge is a corporate social responsibility (CSR) initiative of the Exchange, aimed at promoting the health and wellbeing of our operating community which will also present a platform for teamwork and networking. The initiative will enhance the concept of volunteerism within participating companies,” Adeeko said.

    Though the challenge will be primarily open to teams of employees from companies listed on the Nigerian Stock Exchange, non-commercial organizations such as Federal, State and Local Governments, quasi-governmental organizations, educational institutions and non-governmental organisations (NGOs) will be invited to compete as well.

     

  • Fidson grows sales by 28%

    Fidson grows sales by 28%

    Fidson Healthcare Plc grew its top-line by 28 per cent in 2013 as the healthcare company increased its market share.

    Key extracts of the audited report and accounts of Fidson for the year ended December 31, 2013 showed that total sales rose from N7.2 billion in 2012 to N9.2 billion in 2013. Gross profit also rose by 25 per cent from N4 billion in 202 to N5 billion in 2013.

    The increase in sales and better management of operational costs led to higher gross margins, which saw operating profit rising from N854 million to N1.3 billion

    However, profit before tax dropped considerably from N540 million in 2012 to N250 million in 2013. Profit after tax also followed the downtrend, dropping from N207 million to N155 million.

    Management of the company indicated that the decline in pre and post tax profits was due to impairment loss incurred on Fidson Products Limited, an associate company that was adversely affected by the ban on importation of diapers, the major product of the company.

    However, other comprehensive income majorly from actuarial gains at N42 million against a loss of N19 million the previous year moderated total comprehensive income for the year to N197 million, up from N188m in 2012.

    Fidson’s balance sheet grew by 15 per cent from N10.8 billion in 2012 to N12.4 billion, mainly resulting from the company’s investment in the Biotech plant.

    Management of the company said they expected better performance this year citing increase in pre-tax profit in the first quarter. Profit before tax for the first quarter stood at N283 million as against N269.6 million recorded in corresponding period of 2013.

    Fidson recently said it was rounding off pre-offer process to issue a N2 billion bond to partly refinance its new multi-billion Naira World Health Organisation (WHO)-standards manufacturing complex.

    Operations Director, Fidson Healthcare Plc, Mr. Biola Adebayo, said the company is concluding arrangements for the bond issue noting that the bond may hit the capital market next month.

    According to him, the net proceeds of the bond issue would be used to refinance some existing bank loans with a view to consolidate the bank loans into a more amenable medium term bond issue. This is part of the company’s financing mix strategy to ensure that the benefits of its expansion impact on shareholders’ returns.

     

     

    Adebayo said the company has spent N7 billion on the new manufacturing plant and all the equipment and machines are currently on site. The company has so far financed the new 7.5 acres-manufacturing plant with internally generated revenue and loans from banks.

    He said the new manufacturing plant, which will aggregate the existing manufacturing lines from other existing plant and add a new line for intravenous products, will likely be commissioned in the third quarter of 2014.

    He projected that the new business line of intravenous add between N3 billion and N4 billion to the company’s turnover in 2015.

    He said the new manufacturing plant is a game-changing investment that will further enhance Fidson’s leadership position in the healthcare industry and position it in good stead to compete for global healthcare funds and orders.

    He said the new plant would further enhance the local manufacturing capacity noting that the company’s current product profile of 60-40 importation/manufacturing ratio to 40-60, shifting the company’s operations towards local manufacturing.

    He added that the new manufacturing plant, which is being built to WHO standards and certification, will enable Fidson to engage in contract or tall manufacturing for many global pharmaceutical companies, which want to manufacture their products in Nigeria but do not want to establish full-fledged manufacturing plants.

    Adebayo noted that the prospects for the company’s growth is huge pointing out that there are no more than three companies manufacturing its new line of intravenous products and the volume needed by the country is so huge.

     

     

  • Chams outlines growth strategy to sustain profitability

    Chams outlines growth strategy to sustain profitability

    After posting a net profit of N188 million in 2013, Chams Plc has outlined its growth strategy and priorities in 2014 and beyond with a reassurance that ongoing initiatives would surmount industry challenges and stabilize the profitability of the information and communication technology company.

    Addressing shareholders at the annual general meeting of the company in Lagos, directors of Chams said the company was poised for stable growth with several initiatives, partnerships and restructuring expected to impact positively on performance in the years ahead.

    Chairman, Chams Plc, Very Revd Ayodeji  Richards, said the industry outlook and the corporate strategy indicate a robust future for the company.

    According to him, the information and communication technology (ICT) sector has now become a key driver of economic activity in Nigeria and other developing markets with myriad of ICT solutions now required to support business in various sectors of the economy, including financial services sector, telecommunications sector and trade.

    “The ICT business is so huge and indefinite in many respects. Our focus therefore will be on the identity management and payment industries. The structure and nature of economies in this part of the world leaves a huge gap to fill, given that there is an absence of core identity infrastructure, which also makes it difficult for the payment system to thrive,” Richards said.

    He outlined that Chams has maintained leadership in the identity management industry with several significant projects undertaken with various public and private institutions.

    “We have implemented and are working on projects that include: Biometric Matching Solution project led by CBN Banker’s committee, National Identity project led by NIMC, Identity Management project for the State of Osun, Identity Management project for Anambra State, You-WIN biometric data capture project, PHCN biometric data capture project, Call Centre project for Telcos and banks in partnership with Tech Mahindra, Payroll Automation project for the State of Osun, Osun State Residency Card, Internal Generated Revenue project for Anambra State and Internally Generated Revenue project for Abia State,” Richards said.

    He pointed out that the demand for identity management and transaction payments solutions is likely to continue growing at a compound annual growth rate (CAGR) of 5.0 per cent until 2018 with the likelihood of demand growth arising from the ongoing implementation of the Central Bank of Nigeria’s cashlite policy; increasing financial inclusion and the digitization of commerce.

    According to him, while there are challenges in the short term, the board of directors is confident that the outlook for the identity management and payments industry in general and Chams specifically is positive over the medium to long term.

    He added that the company has been investing in far reaching development programmes aimed at strengthening its structure to provide cushion for any shock or disruption that may arise from the competitive operating environment that is fast becoming more global than local.

    Group managing director, Chams Plc, Demola Aladekomo, said the performance of the company in 2013 confirmed that the various initiatives that had been put in place have started bearing fruit.

    “To consolidate on our performance in the last financial year and maintain our profitability is quite commendable and we are confident that things can only become better for us. More gratifying is the fact that we have sustained our topline growth trajectory, an indication that we have continued to increase our market share and remain competitive. We have entered into some partnership agreements that will have positive impact on our performance in the coming years,” Aladekomo said.

    According to him, the priorities of the company in 2014 include completion of the ongoing restructuring across the group and dedication of its energy towards delivering value to all stakeholders;  upgrading of its card personalization bureau to EMV-certified standard and fostering strategic alliance with its partners based in South Africa and Israel.

    He added that the company would also strive to launch new card products and solutions into the market; sustain growth in its market share; achieve a profit growth of 300 per cent while continuing to engage the investment community and keep them abreast of developments in the company.

    In the 2014, Chams will also drive the implementation of the Bank Verification Number project initiated by the Central Bank of Nigeria (CBN) and the Bankers’ Committee. It is implementing the one-year project in partnership with Dermalog Identification Systems, a leading global company in the field of bio-payment. Chams and its technical partner, Dermalog, will work for five years on the Bank Biometric Matching Solution Project, which is expected to create 1000 new jobs for young professionals.

    Apart from its benefits to the national economy, which is bridging the formal and informal economy, the Bankers Biometric Matching Solution project and the increasing uptake of identity management products and services by private and public enterprises are expected to usher Chams into a new era of strength, financial stability, improved cash flow and profitability beyond the 2014 financial year