By Taofik Salako, Deputy Group Business Editor

BUA Cement Plc grew net profit by 16.3 per cent to N70.5 billion in 2020 as sales rose by 19 per cent to N209 billion.

Unaudited report and accounts of BUA Cement for the year ended December 31, 2020 showed that Nigeria’s second largest cement company recorded growths across key performance indicators.

Gross profit rose by 16 per cent to N95.4 billion in 2020 as against N82.4 billion in 2019. The company increased its net revenues by 19 per cent to N209 billion, with sales volumes up 13 per cent by about 600,000 tons to 5.10 million tons in 2020. Operating profits increased to N82.5 billion while profit after tax rose from N60.6 billion in 20219 to N70.5 billion in 2020.

The company stated that the report further consolidated its position as one of Nigeria’s most profitable companies – a position it is expected to strengthen further with the commissioning of its new three million metric tonnes Sokoto Cement Plant in 2021 and the addition of three new lines of 9.0 million metric tonnes total capacity in Adamawa, Edo and Sokoto States by 2023 for which it recently signed an agreement with Sinoma CBMI.

The new plants are expected to bring BUA Cement’s total capacity to 20 million metric tonnes yearly upon completion.

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The company indicated that its 2020 full year unaudited results evidenced its focus on efficiency, a strong management team, excellent cost management measures and newer, technologically advanced plants.

Managing Director, BUA Cement Plc, Yusuf Binji, said  the company’s exceptional performance in the 2020 financial year was a reflection of the continued value and strength of the BUA Cement brand and product offerings.

According to him, the results also attested to the excellent implementation of the company’s business continuity plan, which ensured that BUA Cement  withstood the impact of the pandemic throughout last year.

In a recent statement, Binji noted that despite the prevailing economic conditions in 2020, BUA Cement remained quite optimistic about the future because it offers opportunity to further evolve its business model and accelerated its development.

“We will continue to push to new markets aided by a focused distribution strategy,” Binji said.

He pointed out that BUA Cement had last year entered strategic alliances for the supply of Liquefied Natural Gas (LNG) at its Kalambaina Plant, Sokoto State, and for the management of its mining operations, noting that with these deliberate and strategic choices amongst other cost management efforts, it is expected that BUA Cement will continue to combine development and innovation into its offerings and activities to drive efficiency, reduce operating costs and maximize profits.

In an interview, Chairman, BUA Cement, Abdul Samad Rabiu said despite the strides made in the industry in the past few years, there was still room for immense growth.

According to him, Nigeria with its population of about 200 million people was still  underserved by the cement industry with current consumption levels at about 130 kilogrammes per head compared to smaller African countries with consumption levels at about 180kilogrammes per head.

He said Nigeria’s cement consumption is expected to increase to about 200 kilogrammes per head in coming years which is one of the reasons BUA Cement is ramping up its investments in new plants to be able to meet this potential demand as well as take advantage of regional export opportunities through the African Continental Free Trade Area (AfCFTA) agreement which came into effect in 2021.

BUA Cement is the second largest manufacturing and cement company listed on the Nigerian Stock Exchange (NSE). The company operates four plants in Edo and Sokoto states with its key markets in the Southeast, Northwest and Northeast.

The company recently completed Nigeria’s largest corporate bond offering ever of N115 billion which was oversubscribed to the tune of N137.82 billion.

By Taofik Salako, Deputy Group Business Editor

More than two in every three transactions at the equities market ended in price appreciation as widespread bargain-hunting spurred the stock market to a rally, after losing N663 billion last week.

Benchmark indices at the Nigerian Stock Exchange (NSE) showed average gain of 0.33 per cent, equivalent to net capital gain of N69 billion. The rally moderated the negative loss so far in February to -4.3 per cent and increased the positive average year-to-date return to 0.8 per cent.

The stock market has traded largely negative in February, moderating the global-ranking performance posted in January. Nigerian equities were ranked seventh on global returns chart last month.

But several analysts expected the market to witness increasing rally as the earnings season gathers momentum. Most quoted equities are expected to submit their full-year audited results and dividend recommendations by March 31, 2021, the deadline for the 90-day submission period under the rules at the stock market.

“We believe bargain hunting would boost the performance of the market this week,” Afrinvest Securities stated.

The All Share Index (ASI)- the value-based common index that tracks all share prices at the NSE, rose from its opening index of 40,439.85 points to close at 40,571.67 points. Aggregate market value of all quoted equities also rose correspondingly from its opening value of N21.156 trillion to close at N21.225 trillion.

With 31 gainers to 13 losers, all sectoral indices closed positive, underlining the widespread positive sentiments across the sectors. The NSE Oil & Gas Index led the rally with a gain of 5.4 per cent. The NSE Banking Index appreciated by 1.8 per cent. The NSE Insurance Index rose by 1.4 per cent. The NSE Industrial Goods Index appreciated by 0.35 per cent while the NSE Consumer Goods Index inched up by 0.01 per cent.

Seplat Petroleum Development Company led the gainers with a gain of N49.50 to close at N544.50. Lafarge Africa followed with a gain of N1.25 to close at N26 while Julius Berger Nigeria rallied 50 kobo to close at N18.50 per share.

On the negative side, Conoil led the losers with a drop of N2.10 to close at N18.90. MTN Nigeria followed with a loss of N2 to close at N180 while Dangote Sugar Refinery declined by 20 kobo to close at N19 per share.

Total turnover stood at 206.243 million shares valued at N2.16 billion in 4,264 deals.  Zenith Bank was the most active stock with a turnover of 21.5 million units worth N539.6 million.

By Taofik Salako, Deputy Group Business Editor

The Corporate Affairs Commission (CAC) has reiterated its support for the ongoing demutualisation of the Nigerian Stock Exchange (NSE).

Demutualisation is the conversion of a member-owned, non-profit, mutual-based organisation to a profit-making, public limited liability company owned by shareholders.

Registrar-General and Chief Executive Officer, CAC, Alhaji Garba Abubakar gave the assurance yesterday during a digital closing gong ceremony at the NSE.

He said the CAC was excited that the demutualisation is in the final stage and coming to a close. CAC, as Nigeria’s corporate registry, has important roles to play in registering an approving the emergent companies from the demutualisation.

“We are glad that the demutualisation of the Exchange is coming to a close and we are eager to see the brand new entities that will act with different mandates to support the economy and investors,” Abubakar said.

He said the Commission has a mutually beneficial relationship with the Exchange, assuring that he would continue to honour the relationship.

He said the CAC remains committed to its responsibility of providing an enabling climate that supports the efforts of the government to improve the ease of doing business not only in registering new businesses but in fulfilling post-registration activities.

“To this end, we began the implementation of CAMA 2020 on January 1, 2021 and we have deployed a new technology solution that supports the full implementation of the law. Our enlightenment on the new CAMA is ongoing and we will continue to engage our stakeholders,” Abubakar said.

The event provided an opportunity for the CAC to intimate the capital market community on the reform initiatives of the CAC, particularly the Companies and Allied Matters Act (CAMA) 2020, which was assented to by His Excellency, President Muhammadu Buhari in August 2020.

NSE Chief Executive Officer, Mr. Oscar Onyema said the Exchange has remained a committed partner to the CAC over the years.

“We are particularly proud of our collaboration during the legislative process of the Company and Allied Matters Bill which led to the signing into law of CAMA 2020, and our recent collaboration with the CAC – along with other stakeholders – to host a public presentation of the newly upgraded CAC Online Registration Portal. We note this success and commend the CAC for its reform initiatives even in challenging times,” Onyema said.

He said the Exchange is grateful for the dedicated support of the CAC in the final stages of the ongoing demutualisation exercise.

He noted that the demutualisation would see the Exchange unfolding into a structure that takes full advantage of business opportunities in line with its growth strategy into the future.

The Exchange has been resolute in its commitment to provide issuers with a platform that allows them to meet their strategic business objectives. Facilitating the engagement with the CAC and capital market stakeholders was, therefore, both timely and strategic as the commission is a critical regulatory agency in achieving such business objectives.

Nigerian equities continued their February decline yesterday with a net loss of N75 billion in the first trading of the week, the sixth consecutive negative trading session.

Benchmark indices at the Nigerian Stock Exchange (NSE) showed average decline of 0.35 per cent, moderating the average year-to-date return to 3.2 per cent. Nigerian equities have recorded an average loss of 2.0 per cent so far this month.

Aggregate market capitalisation of all quoted equities rose dropped from its opening value of N21.819 trillion to close at N21.744 trillion. The All Share Index (ASI)- a value-based common index that tracks all share prices at the Exchange, declined from its opening index of 41,709.09 points to close at 41,564.31 points.

With 23 gainers to 16 losers, the negative overall market position was driven largely by losses recorded by mid and large-cap stocks.

Most sectoral indices closed negative. The NSE Banking Index dropped by 2.7 per cent. The NSE Insurance Index dipped by 0.8 per cent while the NSE Consumer Goods Index declined by 0.3 per cent. Meanwhile, the NSE Industrial Goods Index inched up by 0.1 per cent while the NSE Oil & Gas Index closed flat.

Total turnover stood at 340.284 million shares valued at N2.64 billion in 5,251 deals. Union Bank of Nigeria (UBN) was the most active stock with a turnover of 78.81 million shares valued at N457.06 million. It was followed by FBN Holdings with 54.2 million shares worth N396.4 million.

“In the next trading session, we expect to see slight profit taking in high-priced stocks,” Afrinvest Securities stated, referencing possible continuing decline in overall market position.

Guaranty Trust Bank led the losers with a drop of N3.15 to close at N32.85. PZ Cussons Nigeria followed with a loss of 55 kobo to close at N5.10 while Flour Mills of Nigeria dropped by 45 kobo to close at N31 per share.

On the positive side, Guinness Nigeria led the gainers with a gain of 85 kobo to close at N19.85. Africa Prudential followed with a gain of 55 kobo to close at N7.25 while UPDC REITs rose by 50 kobo to close at N6 per share.

Fitch Ratings has assigned Ecobank Nigeria Limited (ENG) a Long-Term Issuer Default Rating (IDR) of ‘B-’ with a Stable Outlook, Viability Rating (VR) of ‘b-’ and National Long-Term Rating of ‘BBB (nga)’.
The report noted that Ecobank’s IDRs are driven by its stand alone creditworthiness, as expressed by its Viability Rating (VR).
The VR reflects the constraint of Nigeria’s challenging environment and modest core capital buffers, among others.This is balanced by company profile strengths as well as a solid funding profile and good foreign-currency liquidity, which is enhanced by prudent liquidity management by the Ecobank group.
According to Fitch, “the Stable Outlook on ENG’s Long-Term IDR reflects our view that the bank has sufficient headroom at its rating to absorb moderate shocks from sustained downside risks to the operating environment, the heightened level of risk in doing banking business in Nigeria and the ensuing risks to its financial performance, particularly asset quality, over the next 18 months’’.
It added: “The Stable Outlook also reflects our expectations that capitalisation will remain resilient over this period with the bank maintaining adequate buffers over the minimum regulatory requirements.”
Fitch Rating reported that the VR benefits from ENG’s company profile strengths of being part of the leading pan-African Ecobank group. ENG is a 100 per cent owned subsidiary of Ecobank Transnational Incorporated (ETI; B-/Stable). ETI is a regional bank holding company with fully-fledged banking subsidiaries in 33 African countries.
The group also has a banking licence in France and representative offices in Addis Ababa, Johannesburg, Beijing, London, and Dubai.The group’s operations are highly integrated, with all entities connected to a common operating platform and risk management framework, and common branding.
ENG is a material subsidiary for ETI, and its largest single entity, contributing to 23 per cent of group assets at end-nine month 20. ETI continues to implement a turnaround strategy at Ecobank Nigeria, having deleveraged and de-risked the bank in recent years, although it returned to growth in 2020 and plans above-sector-average loan growth in the medium term. Fitch noted that ENG’s  management quality is a relative strength, with ETI appointing experienced bankers to Ecobank Nigeria’s  senior team.
“ENG has a solid funding profile, with low-cost current and savings accounts reaching 58 per cent of total deposits at end-nine month 20 helping the bank to reduce its cost of funding. It has achieved good deposit growth through the expansion of digital channels and its financial inclusion initiatives.
Retail and SME deposits to account for 58 per cent of total customer deposits at end-nine month 2020, which results in reasonable deposit concentration, with the top 20 customer deposits representing 29 per cent of the total.” the report stated.
Fitch Ratings also views ENG’s liquidity management as prudent with contingency plans in place. Local currency liquidity is underpinned by a high share of liquid assets (cash, interbank placements and sovereign securities), representing more than 50 per cent of total assets at end-9M20. ENG’s foreign currency funding benefits from sizeable interbank deposits, which represented about 15 per cent of total funding at end-9M20.
More than half of these deposits (about USD400 million) came from ETI’s affiliates at end-9M20. This reflects the group’s well-established inter-affiliate short-term deposit placement programme (IAP), amounting to $650 million at end-first half of 2020, which provides ENG with a significant competitive advantage compared with most other Nigerian banks, as ENG is able to rely on IAP funding when foreign currency liquidity conditions temporarily tighten in Nigeria.

By Collins Nweze

FirstBank of Nigeria Lim-ited has announced the provision of loans of up to N1 million to its agents.

This is in furtherance of the need to promote the business  of the Firstmonie agents.

The bank has over 86,300 Firstmonie Agents, spread across the country’s 772 local government areas.

With its location in every neighbourhood, Firstmonie agents have been integral to filling the financial exclusion gap, providing convenient banking services that are easily accessible, thereby saving time and travel costs for individuals in the suburbs and remote environments that have no access to financial services.

The bank’s financial inclusion activities is in line with the mandate of the Central Bank of Nigeria (CBN) to ensure the availability of affordable financial products and services to individuals and groups of people in the country; irrespective of location, literacy levels, familiarity with technology and accessibility to modern infrastructural facilities. The Firstmonie Agent channel is among the bank’s many initiatives to expand financial access in the country.

Appreciating the Firstmonie Agents, Group Executive, e-Business & Retail Products, First Bank, Chuma Ezirim,  said: “The roles played by our Firstmonie Agents in promoting businesses across the nooks and crannies of the country cannot be overemphasized as they have continued to set the pace in extending financial inclusion to communities with little or no access to financial services.

“With our Firstmonie Agents in every neighbourhood, several communities have witnessed a surge in business and financial activities, which is contributory to national growth and development. We commend our Agents and are delighted to support them with credit facilities, which they can access 24 hours a day in less than two minutes.”