By Taofik Salako, Deputy Group Business Editor

Dangote Cement Plc yesterday closed application for a commercial paper (CP) offer aimed at raising N50 billion in additional short-term debt capital as the Sub-Saharan Africa’s largest cement group is leveraging top-notch rating to deepen balance sheet and drive overall growth.

Dangote Cement, Nigeria’s most capitalised quoted company offered Series 17 and 18 under its N150 billion commercial paper (CP) issuance programme. Application lists for the two offers opened on Monday August 31, 2020 and closed on Thursday, September 03, 2020. Dangote Cement plans to raise N50 billion across the two series.

Dangote Cement offered 177-day CP with effective yield of 4.0000 per cent and a discount rate of 3.9240 per cent under its 17th series. The 18th series CP was a 268-day instrument with effective and discount yield of 5.0000 per cent and 4.8231per cent respectively.

Minimum subscription for the two offers was N5 million and thereafter in multiples of N1,000. The CPs, are not subjected to withholding taxes. While the allotment results were being collated as at press time, market pundits believed the offers were fully subscribed.

According to the company, the net proceeds of the new capital raising would be used to fund short-term working capital requirements and for general corporate purposes.

The new offers reflected the declining yields in the fixed income market, an attraction for companies seeking to rebalance their balance sheets. Dangote Cement had offered it 15th series, a 175-day CP, with effective yield of 5.0000 per cent and a discount rate of 4.8833 per cent. The 16th series, a 266-day CP, was also offered at effective and discount yield of 6.0000 per cent and 5.7492 per cent respectively.

With an installed capacity of 45.6 metric tonnes across its operations in 10 African countries, Dangote Cement is the largest cement company in Sub Saharan Africa (SSA). It is rated AA+ long-term rating by GCR and Aa2.ng long-term rating by Moody’s. It is one of the few companies in Nigeria with a rating of AA+.

Dangote Cement had in May 2020 raised N50 billion under series 15 and 16 of the N150 billion CP issuance programme. It had in April 2020successfully launched its debut bond issuance, a N100 billion bond. The debut bond was the first series under the company’s N300 billion shelf bond issuance programme.

Dangote Cement distributed N272.6 billion to shareholders as cash dividend for the 2019 business year.

Key extracts of the audited report and accounts for the year ended December 31, 2019 showed that turnover dropped from N901.21 billion in 2018 to N891.67 billion in 2019. Gross profit also declined marginally from N517.90 billion to N511.68 billion. Profit before tax stood at N250.48 billion in 2019 as against N300.81 billion in 2018 while profit after tax dropped from N390.33 billion to N200.52 billion.

The report meanwhile indicated that the group’s investments across Africa have started yielding desired results as Pan-African sales volume grew in the year 2019, hitting 9.6 Mt from 9.4 Mt. Dangote Cement Plant, Mtwara, Tanzania, recorded an increase of 94 percent increase in volume within the review period. Dangote Cement Plant, Pout, Senegal put up a remarkable performance with sales up more than 100 percent of rated capacity.

READ ALSO: Dangote commits $1m to renovation

Dangote Cement is Africa’s leading cement producer with nearly 46Mta capacity across Africa. it is a fully integrated quarry-to-customer producer, with a production capacity of 29.25Mta in its home market, Nigeria. Obajana plant in Kogi state, Nigeria, is the largest in Africa with 13.25Mta of capacity across four lines; Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mta and Gboko plant in Benue state has 4Mta.

In addition, Dangote Cement has  operations in Cameroon (1.5Mta clinker grinding), Congo (1.5Mta), Ghana (1.5Mta import), Ethiopia (2.5Mta), Senegal (1.5Mta), Sierra Leone (0.5Mta import), South Africa (2.8Mta), Tanzania (3.0Mta), Zambia (1.5Mta).

Nigeria’s most capitalised financial institution, Guaranty Trust Bank (GTB) Plc reported a pre-tax profit of N109.7 billion in the first half of this year.

The board of the bank has declared interim dividend of N8.83 billion or 30 kobo per share for the first half, sustaining the long-established tradition of paying dividend twice a year.

Key extracts of the audited financial results for the half year ended June 30, 2020 released yesterday at the Nigerian Stock Exchange (NSE) and London Stock Exchange (LSE) showed steady growths in key operational indices, although the bottom-line declined marginally.

Loan book grew by 8.1 per cent from N1.502 trillion recorded as at December 2019 to N1.624 trillion in June 2020. Customer deposits increased by 18.5 per cent to N3.0 trillion from N2.53 trillion in December 2019. Profit before tax closed first half 2020 at N109.7 billion, representing a decrease of 5.2 per cent from N115.8 billion recorded in the corresponding period of 2019.

Total assets stood at N4.511trillion while shareholders’ funds stood at N720.9 billion. In terms of asset quality, non-performing loan ratio and cost of risk closed at 6.8 per cent and 0.4 per cent in June 2020 from 6.5 per cent and 0.3 per cent in December 2019 respectively. Overall, asset quality remains stable with adequate coverage of 118.1 per cent while capital remains strong with capitak adequacy ratio (CAR) of 22.9 per cent.

With these, return on equity (ROAE) and return on assets (ROAA) stood at 26.8 per cent and 4.6 per cent respectively.

Chief Executive Officer, Guaranty Trust Bank (GTB) Plc, Mr. Segun Agbaje, said while this period is undoubtedly tough and trying time for people, businesses and economies the world over, the bank’s financial performance in the first half of the year reflected the quality of its past decisions which have broadened its earnings and strategically positioned it to thrive, thus far, through the current global health and economic crises.

He pointed out that underpinning the financial performance iwas the bank’s commitment to being there for its customers and the communities it serves.

He noted that over the past six months, the bank has lent the full weight of its r franchise to safeguarding lives and livelihoods of staff and customers by leading from the front in the fight to curtail the COVID-19 outbreak and offering grace periods on loans to small business customers.

“Going forward, our focus is not just to survive this pandemic, but to thrive beyond it. That is why we are going ahead with our plans to reimagine how we create value for all our stakeholders. We know that making financial services work for customers goes beyond banking, and in line with our long-term strategy, we will seek to create and drive innovative financial solutions that go beyond banking,” Agbaje said.

CWG Plc has said its cloud-based ERP solution will help to address the challenges confronting small and medium enterprises (SMEs) and enhance their operations.

The solution, known as SMERP, ensures smooth functioning of daily processes, enhancement of work efficiency and substantial reduction in recurring cost.

Product Manager, SMERP, CWG Plc, Omodolapo Orogbemi said the decision to target SMEs was borne out of the fact that they are the largest segment of the economy.

According to him, the company believes the successful development and sustainability of SMEs is important as they play a major role in most economies, particularly in developing countries like Nigeria, where they contribute about 70 per cent of job creations.

He noted that most formal jobs are generated by SMEs, which create seven out of 10 jobs but are lacking the basic tools to function effectively and efficiently.

“We have seen that SMEs in Nigeria have enormous challenges of innovating, supporting their business growth and keeping the lights-on. That is why we have developed the SMERP solution to strategically address their challenges,” Orogbemi said.

He outlined that SMERP is a reliable, scalable and flexible solution that will help the SMEs to improve the Gross Domestic Products (GDP) of the Nigerian economy.

He pointed out that SMERP will provide business outcome such as smooth functioning of daily processes, enhancement of work efficiency, substantial reduction in recurring cost and improved operational efficiency for SMEs.

He added that the solution also comes with additional advantages of remote business monitoring, business intelligence and data analytics and improving the overall competitiveness in the world market through modern technologies.

“The SMERP ERP platform supports the survival and standardization of the SME sector through different modules such as invoicing, accounting, inventory, CRM, point of sale, rewards and loyalty programmes. These benefits to business owners ensure business expansion and transforming one-time customers to regulars,” Orogbemi said.

He noted that SMEs account for the majority of businesses worldwide and are important contributors to job creation and global economic development as they represent about 90 per cent of businesses and more than 50 per cent of employment worldwide.

The World Bank Group estimated that formal SMEs contribute up to 40 per cent of national income (GDP) in emerging economies.

Ellah Lakes Plc has entered into exclusive discussions to acquire an oil palm processing company.

In a regulatory filing, the board of Ellah Lakes indicated that the agricultural company plans to purchase 100 per cent equities of an oil palm processing company with substantial assets in Delta State.

“Though a binding term sheet has been agreed, the completion of the proposed transaction is subject to regulatory approvals and execution of a definitive agreement,” the company stated.

Ellah Lakes urged investors to take note of the potential transaction while dealing on its securities noting that more updates will be provided to the investing public in accordance with disclosure requirements.

Ellah Lakes, incorporated on July 2, 1980, was listed on the NSE on January 14, 1993. Originally a fish-farming company, the firm had embarked on a comprehensive restructuring and diversification of its businesses. Last year, it acquired Telluria to diversify its products in the agribusiness sector.

By Taofik Salako, Deputy Group Business Editor

Nestlé S.A., world’s largest food company, has acquired more equity stake valued at about N747.54 million in Nestle Nigeria as multinationals continued to tighten shareholding control on their Nigerian subsidiaries.

An insider transaction report on the deal indicated that Nestle acquired 636,384 ordinary shares of 50 kobo each at N1,174.67 per share. The deal increased the Swiss multinational food and drink company’s majority shareholding in Nestle by 0.08 per cent.

Nigeria is a key market for Nestle where the stock and the brands have sustained decades of market leadership. Nigeria and the rest of other Sub-Saharan Africa (SSA) recorded double-digit growth in the first half, driven by real internal growth.

Nestle’s half-year results for 2020 showed that SSA was the best-performing segment under the groups’ Asia, Oceania and sub-Saharan Africa (AOA) zone.

“We expect full-year organic sales growth between two per cent and three per cent. The underlying trading operating profit margin is expected to improve. Underlying earnings per share in constant currency and capital efficiency are expected to increase. This guidance is based on our current knowledge of COVID-19 developments and assumes no material deterioration versus present conditions,” Nestle SA stated in the group’s six-month report.

Key extracts of the interim report and accounts of Nestle Nigeria for the half year ended June 30, 2020 showed that turnover was steady at N141 billion in first half 2020 as against N141.9 billion in comparable period of 2019. Profit after tax stood at N21.8 billion in first half 2020.

READ ALSO: Nestlé Nigeria appoints new MD

Managing Director, Nestlé Nigeria Plc, Mauricio Alarcon, said the results illustrated the resilience of the company.

According to him, amid the on-going COVID-19 pandemic, Nestlé Nigeria has delivered consistent results in terms of revenue while exchange rate variations and increase in the price of some key materials have affected profitability.

“While it is still early to assess the impact of this crisis, we are fully confident in our people’s agility and deep commitment to overcome challenges and continue to deliver value for our shareholders and for society. Going forward, we will remain focused on three key priorities which include safeguarding the health and wellbeing of our people, ensuring business continuity to meet consumer needs and supporting our communities,’’ Mauricio said.

By Taofik Salako Deputy Group Business Editor

Nigerian equities remained on the upswing yesterday as increased buy orders for large and mid-cap stocks rallied the market to net capital gain of N32.7 billion.

The benchmark index for the Nigerian Stock Exchange (NSE), the All Share Index (ASI), posted average gain of 0.3 per cent to close at 25,291.73 points. Aggregate market value of all quoted equities also increased to N13.2 trillion.

With this, the month-to-date return rose to 2.4 per cent while the negative average year-to-date return was moderated to -5.8 per cent.

Sectoral indices showed mixed performance, underlining the general sell pressure amid bargain-hunting for some large-cap stocks. The NSE Insurance Index rose by 1.62 per cent while the NSE Industrial Goods Index appreciated by 1.10 per cent. However, the NSE Banking Index dropped by 0.22 per cent. The NSE Consumer Goods Index dipped by 0.07 per cent while the NSE Oil and Gas Index closed flat.

Read Also: Foreign investors rekindle interest in Nigerian stocks

Total turnover rose marginally to 251.34 million shares valued at N1.17 billion in 3,713 deals. Transnational Corporation of Nigeria was the most active stock with a turnover of 94.88 million shares.  United Bank for Africa followed with 33.2 million shares while Wema Bank placed third with 14.6 million shares.

There were 15 gainers to 20 losers. NEM Insurance led the gainers, in percentage terms, with a gain of 9.6 per cent. WAPIC Insurance followed with 6.3 per cent while Japaul rose by 4.8 per cent.

Beta Glass led the decliners dropping by 10 per cent. May and Baker Nigeria trailed with a drop of 9.9 per cent while Arbico declined by 9.5 per cent.

“Given the gaining streak, we expect investors to take profit in subsequent trading days,” Afrinvest Securities stated.

By Taofik Salako, Deputy Group Business Editor

Infinity Trust Mortgage Bank (ITMB) Plc has secured a N2.7 billion loan from the Development Bank of Nigeria (DBN) for lending to further deepen mortgage penetration and inclusion.

ITMB Managing Director Dr. Olabanjo Obaleye said the facility demonstrated ITMB’s strong financial capacity and rating,

He said the cash would help the mortgage bank to further expand its product offerings to operators in the micro, small and medium enterprises (MSMEs) sector, particularly as they constitute more than 90 per cent of enterprises in the country.

“It will help us reach many more customers that are self-employed and those in the Micro, Small and Medium-sized Enterprises (MSMEs) space that want to purchase commercial properties like shop and offices. This will also improve financial inclusion for mortgage products,” Obaleye said.

He urged those in the MSMEs sector and small corporates who are interested in accessing a mortgage loans to build and purchase residential or commercial properties to visit any of ITMB’s office locations for thorough guidance and necessary approval.

“Shelter is one of the basic human needs, this is why we are passionate about providing needed mortgage loan to deserving Nigerians, particularly those in the MSMEs sector to purchase properties. This will further broaden the mortgage penetration depth in the market.

‘’We have simplified our processes in such a way that a mortgage loan can be disbursed within three days to an individual, giving that the applicant meets all the mandatory requirements.

We have streamlined our processes and incorporate the use of technology which has made the disbursement of loan to individuals so fast, making us the leading primary mortgage bank in Nigeria which is reflected in our financial results,” Obaleye said.

He added that the bank has consistently demonstrated strong brand by maintaining consistent profitability over the years and operating resilience through strong regulatory entity and service ratings.

He noted that the bank’s results are also indicative of the proactive leadership and versatile management of the bank in maintaining key performance indicators despite the global impact of the pandemic.

According to him, Infinity Trust is one of the leading and most capitalized primary mortgage banks in Nigeria having significantly increased its shareholders’ funds from less than N50 million in 2003 to more than N6 billion while maintaining an unbroken record in terms of consistency in dividend payment to shareholders for 14 years running.