The Nation Newspaper

Category: Equities

  • Axxela raises N12.4b in oversubscribed bond

    Axxela raises N12.4b in oversubscribed bond

    By Taofik Salako, Deputy Group Business Editor

     

    Axxela Limited’s first bond issuance recorded a total subscription of N12.4 billion, 24 per cent above the offer size of N10 billion. Under the terms of the issue, Axxela can absorb additional 15 per cent of the offer size, giving the fast-growing gas and power firm opportunity to increase its issuance to N11.5 billion.

    The Axxela Funding 1 Plc Series 1 N10 billion seven-year fixed rate senior secured bond issue was issued under the company’s N50 billion bond issuance programme. The bond was issued by Axxela Funding 1 PLC; a special purpose funding vehicle and wholly-owned subsidiary of Axxela Limited.

    Chief Executive Officer, Axxela Limited, Bolaji Osunsanya said the company’s milestone debut market entry underpins the necessary symbiosis between private entities and the debt capital markets.

    “We appreciate the support of all corporates, professional parties, and investors involved in the ratification and issuance process. The favourable response indicates the level of investor confidence in our company’s reputation, brand, and performance,” Osunsanya said.

    He noted that the funding will support the company’s multi-pronged growth strategy of optimising its operations and assets, expanding its footprint, and revolutionising the midstream sector.

    “As a prime portfolio company with demonstrated leadership within the sector, we remain uniquely positioned to satisfy the growing natural gas and energy demand across the sub-region,” Osunsanya said.

    He added that Axxela’s strategic diversification plans include a ramp up of its gas supply and trading activities across West Africa, alongside the build out of key power and virtual pipeline infrastructure.

    Chief Financial Officer, Axxela Limited, Tim Ononiwu described the bond issuance as another remarkable feat in the company’s growth story as it provided an appropriate financing mix for its enterprise.

    According to him, the oversubscription of the first capital market issuance in such a challenging market is testament to the strengths and prospects of the company.

    “This success avails us the liquidity to implement our business plans, while lowering our cost of capital. In addition, we are well positioned to access the market in the future, giving us the opportunity to continuously provide real value for our shareholders,” Ononiwu said.

    Axxela is a Helios Investment Partners LLP portfolio company, and a designated natural gas shipper on the West African Gas Pipeline (WAGP). Axxela is also the pioneering private sector-led developer of natural gas distribution in Nigeria, delivering at peak 80 million standard cubic feet per day to over 180 industrial and commercial customers through its vast network of gas infrastructure.

    In 20 years, Axxela has built over 309km in gas pipeline infrastructure, and provides unique energy solutions primarily through its subsidiaries: Gaslink Nigeria Limited, Gas Network Services Limited, Central Horizon Gas Company Limited and Transit Gas Nigeria Limited. Axxela is rated BBB+/Positive Stable by Agusto & Co and Bbb+/Stable by GCR.

  • ‘Local refining will lessen economic downturn’

    ‘Local refining will lessen economic downturn’

    By Taofik Salako, Deputy Group Business Editor

     

    Chairman, OPAC Refinery, Mr Momoh Oyarekhua, has called on the government to support increased local refining, which he said is key to alleviating the post-COVID-19 economic crisis.

    He said the sudden but sustained drop in the price of crude oil in the international market due to fall in demand following the coronavirus pandemic has necessitated the need for increased local refining.

    According to him, the demand collapse was worsened by lack of storage capacity to take up excess supply by major buyers around the world.

    Therefore, there is need for more investment in local refining as a way out of the economic conundrum and to ensure that the country remains resilient post-COVID-19 and beyond.

    By encouraging and increasing local refining, Nigeria saves itself the embarrassing situation of chasing crude buyers around the world, and can also eliminate the importation of premium motor spirit (PMS) and other refined products thereby helping the country cut its foreign exchange exposure, he added.

    Oyarekhua said: “We can save a lot of foreign exchange which will be utilised to fund other important sectors of the economy, which will mean that, as a country, we will not be heavily exposed to the international crude or currency politics.

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    More investment is needed to increase our local refining capacity and the government should provide specific ‘target framework’ to further support and encourage local investors to ensure we produce enough for our local consumption and even for export to earn more foreign currencies while creating jobs.”

    On the damage done by coronavirus and the price war between Saudi Arabia and Russia, which made oil fall as low as $10 per barrel, Oyarekhua stated that government increasing and doubling support for local refineries will further reduce the hardship faced by some of the players in the downstream sector, achieve better consumer-friendly pricing for PMS (petrol) and other refined products.

    We must boost the capacity of our local refineries and scale the modular refineries to meet the challenges of the future and also sustain the gains we have made in the oil and gas industry.

    Oyarekhua said because of Covid-19, “we have been in full lockdown for the past five weeks. The lockdown has been relaxed a bit, although we still advised our staff to remain at home. We do the best we can from home to look after our business, but the situation is not optimal. This delayed the test round for OPAC (Omsa Pillar Astex Company) modular refinery, which was scheduled for operation by the end of March.

    “We are waiting to see what measures the country is putting in place to ameliorate the current challenges and to see if those measures fit into our business model and allow us to schedule a new test round for the refinery.

    On the other hand, some other important parts of the refinery that were also meant to be integrated got delayed because the related expatriate could not travel to Nigeria due to port and airport closures.

    “As of today, the modular refinery is about 98 per cent complete. We have some of our technical staff living at the refinery in isolation and doing some work, but the automation and control system will need expatriate input to be integrated, so that could not be done yet. If the situation normalizes, we should be able to complete the installation of the refinery in no time”.

  • AKK Pipeline: OILSERV begins massive project

    AKK Pipeline: OILSERV begins massive project

    By Taofik Salako, Deputy Group Business Editor

     

    Nigeria is finally on the verge of unlocking huge economic benefits arising from its natural gas endowment as OILSERV Limited starts of the construction Ajaokuta–Kaduna–Kano (AKK) Gas Pipeline project.

    For many years, the country had been hindered by absence of gas transmission pipelines in her bid to harness its abundant gas reserves for provision of gas to generate electricity, and stimulate rapid industrialization using gas as feedstock for fertilisers, ammonia and other petrochemical applications.

    The commencement of the, Nigerian National Petroleum Corporation, NNPC-sponsored Ajaokuta–Kaduna–Kano (AKK) Gas Pipeline project by leading indigenous EPC giant – OILSERV Limited, is the cause for this renewed optimism.

    OILSERV had been awarded the engineering, procurement, construction, installation, testing, and commissioning of the first segment of the 614 km x 40-Inch Gas pipeline, which is from Ajaokuta to mid-way between Abuja and Kaduna. The second segment has been awarded to another company.

    The Nation gathered that OILSERV has achieved significant progress in a short spate of time including the ongoing detailed engineering design, topographical and geotechnical surveys, haulage and stacking of line pipes in preparation to commence construction activities.

    Read Also: Amaechi charges NIMASA on completion of deep blue project

     

    Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mallam Melle Kolo Kyari, said the AKK project is central to resolving the power deficit challenge of the country.

    “Its multiplier effect on the economy and provisions of jobs will be unprecedented. NNPC will give all necessary support to the Contractors to enable them deliver the project within time and within budget,” Kyari said.

    Chairman, OILSERV Limited,  Emeka Okwuosa, gave a pledge that EPC Company will leave no stone unturned to partner with NNPC and make the dreams of 200 million Nigerians come true by delivering the AKK project to global quality and standards.

    He said the capability of OILSERV has been honed in the course of successful delivery of landmark EPC contracts such as lot B of the 48inch OB3 gas pipeline system that is being inaugurated.

    “The optimism and hope that this development represents is a clear elixir that is surely needed by the entire nation at this time. We wish OILSERV, NNPC and everyone else involved in this endeavour, success,” Okwuosa said.

  • Fed Govt’s N150b Sukuk is high-grade investment, say stockbrokers

    Fed Govt’s N150b Sukuk is high-grade investment, say stockbrokers

    By Taofik Salako, Deputy Group Business Editor

     

    The N150 billion Sukuk being issued by the Federal Government is a high-grade investment with high return and almost zero risk, the Chartered Institute of Stockbrokers (CIS) has said.

    The CIS, which regulates the practice of stockbroking in Nigeria, said the ongoing Sukuk issuance is a wealth-creating opportunity for Nigerians, especially in this period of COVID-19 pandemic.

    In a statement jointly signed by its President, Mr Tunde Amolegbe and Chief Executive Officer, Mr Adedeji Ajadi, the CIS urged investors to partner with stockbrokers for investment advice on the processes and procedures for investing in the Sukuk, which application list is scheduled to close on Tuesday, June 2, 2020.

    According to stockbrokers, Sukuk Ijarah is a fixed income security backed by the Federal Government, which makes it an investment without risk as repayment of investors is guaranteed by the full faith and credit of the Federal Government of Nigeria, hence, the instrument is regarded as a gild hedge.

    They noted that Sukuk is highly sought after by ethical Investors as it provides a regular bi-annual tax-free payment for the period of the instrument while principal will be paid at the end of maturity period which is seven years.

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    “The profit to investors is pre-determined at regular interval to enable them enjoy steady cash flow. Sukuk helps in redistribution of wealth. It is a risk management instrument which is ideal for both speculators and investors. Speculators can sell before maturity. The instrument will help the government to finance large projects,” CIS stated.

    Stockbrokers pointed out that the Federal Government has promised to invest the proceeds in specific road projects across the six geo-political zones of the country for the benefit of the citizens as a whole.

    The institute urged investors to approach their stockbrokers to learn more about this instrument prior to making their investment decision, noting that stockbrokers are very accessible and they are professionals equipped with skills and competencies in evaluating the risk and returns associated with such an  instrument and will be able to guide investors accordingly.

    “Stockbrokers will assist investors to open accounts at the Nigerian Stock Exchange’s clearing house, Central Securities Clearing System (CSCS) to keep their investments with opportunities to track it on the NSE and FMDQ in case they decide to sell before maturity,” CIS stated.

     

  • CSCS’ shareholders approve N4.3b dividend

    CSCS’ shareholders approve N4.3b dividend

    By Taofik Salako, Deputy Business Editor

    Shareholders of Central Securities Clearing System (CSCS) Plc at the weekend approved the payment of N4.3 billion as cash dividends for the 2019 business year.

    At the 26th annual general meeting (AGM) held by proxy at the Nigerian Stock Exchange (NSE) Event Centre in Lagos, shareholders approved 22.8 per cent increase in cash payouts. Shareholders will receive 86 kobo dividend per share for the 2019 business year as against 70 kobo per share or N3.5 billion paid for the 2018 business year.

    Chairman, Central Securities Clearing System (CSCS) Plc, Mr. Oscar Onyema, said the 2019 performance of the company showed its resilience amidst market volatility and waning transaction volumes during the year.

    “This set of results and impressive returns to shareholders are commendable, particularly when put in the perspective of the relatively weak liquidity in the market in 2019. This feat reflects the tenacity of the management in diversifying the business and commitment to cost efficiency. Whilst transaction fees waned, it is satisfying that CSCS sustained both top and bottom-line growths, with revenue and profit before tax of N9.1 billion and N6.3 billion respectively,” Onyema said.

    Managing Director, Central Securities Clearing System (CSCS) Plc , Mr. Haruna Jalo-Waziri said the company remains committed to earnings growth and cost efficiency philosophies as it continues to drive its ultimate objective of creating superior value for shareholders and enhancing market efficiencies.

    “I am pleased with the 165 per cent growth in non-core earnings, reflecting our tenacity towards diversifying the business. More importantly, the overall performance reflects the pay-off of our painstaking investment in people and new technologies, as we strengthen our capacity to serve our participants better and meet anticipatory need of the market,” Jalo-Waziri said.

    According to him, notwithstanding the inflationary environment, the company closed 2019 with 31.5 per cent cost-to-income ratio, demonstrating continuous improvement in cost efficiency.

    He noted that as the company delivers on its strategic initiatives aimed at enhancing the post-trade segment of the Nigerian capital market, it remains upbeat on its earnings outlook with expectations of delivering superior returns to shareholder over the long term.

    According to him, CSCS will continue to strengthen its partnership with all market stakeholders towards deepening the market for mutual growth.

    “In 2019, we seamlessly delivered on our core responsibilities of safe depository, clearing and settlement of capital market transactions, but these do not excite us, as we are not in business for these table stakes, which we consider to be routine. We have greater and audacious ambitions of partnering with our stakeholders in realizing the huge potentials of the Nigerian capital market through innovations. I am pleased that we are laying solid foundations for creating value and impactful innovations for the Nigerian market, even as we reckon the odds,” Jalo-Waziri said.

    Speaking on the Coronavirus pandemic, Jalo-Waziri noted that the company had activated its business continuity plan requiring staff to work from home well ahead of the Federal Government’s lockdown in Lagos, Ogun and Abuja.

    “I am happy to report that we continue to seamlessly serve the market remotely, extracting the benefits of our proactive investments in new technologies and people. Whilst operating remotely over the past eight weeks, we continue to record 99.99 per cent uptime across all our channels, with a resounding commitment to efficiently support all primary and secondary market transactions through this challenging time, and always,” Jalo-Waziri said.

  • Seplat targets more acquisitions as shareholders get $59m dividends

    Seplat targets more acquisitions as shareholders get $59m dividends

    By Taofik Salako, Deputy Business Editor

    Seplat Petroleum Development Company Plc remains a resilient business with strong balance sheet to acquire more oil and gas assets and ensure sustainable growths and returns to shareholders.

    At the annual general meeting in Lagos, the company assured that significant free cash flow from a low cost production base and a balanced portfolio split evenly between oil and gas, which is de-linked to oil price have positioned the company for sustainable growth in spite of the moderating impact of the Coronavirus pandemic and global crude oil decline.

    Chairman, Seplat Petroleum Development Company Plc, Dr Ambrose Orjiako, said the company remains focused on delivering shareholder returns through regular dividend distributions and capital growth.

    He spoke just as shareholders approved the distribution of $59 million as cash dividends for the 2019 business year, representing a dividend per share of 10 cents.

    He said the company is in a competitive position for further price-sensitive acquisitions noting that Seplathas been well-positioned for emerging opportunities in the event of further consolidation of the oil and gas industry.

    According to him, amidst the current headwinds occasioned by the prevailing global Coronavirus pandemic and low oil prices, Seplat will continue to maintain strict financial discipline over investment decisions, while also embedding high standards of corporate governance and transparency; strong commitment sustainable business; and effective management of risks with a strong health, safety and environment culture.

    “I believe that Seplat has an important role to play throughout the energy transition that is set to occur in the years and decades ahead, not least through the impact we can have by scaling up our domestic gas supply business and displacing imported diesel fuels that are being burned for power generation and helping Nigeria benefit from the social and economic multiplier effects that reliable and affordable power availability can bring,” Orjiako said.

    He said Seplat plans to position itself for an ambitious next phase of growth which would see the expansion of its footprint in terms of energy business activities, a plan to pursue offshore assets acquisition, as well as opportunity driven entry into different geographies.

    “Looking forward, one of the main challenges facing the independent exploration and production sector is to remain relevant as the world makes the transition to a lower carbon future. The oil and gas industry face considerable challenges given that oil in particular plays such a significant part in today’s energy supply mix, with demand for the commodity still growing. A key part of my role as chairman of the board is to steer the company through these transitions,” Orjiako said.

  • Neimeth’s share prices rises 79% as H1 profit rises by 938.56%

    Neimeth’s share prices rises 79% as H1 profit rises by 938.56%

    By Taofeek Salako

    Neimeth International Pharmaceuticals Plc has grown its bottom-line by 938.5 per cent as increasing market share and cost management strategies lifted the healthcare company to its best performance in four years.

    Investors reacted with a scurry for Neimeth’s shares, triggering a demand-driven share price appreciation that has seen the stock within the best-performing stocks at the Nigerian stock market with capital gain of 79.2 per cent in recent weeks.

    Interim report and accounts of Neimeth for the six-month period ended March 31, 2020 released at the Nigerian Stock Exchange (NSE) showed significant growths across key performance indicators with growing sales and operating efficiency driving operating profit by 225.28 per cent.

    Total turnover crossed a record N1 billion mark with 19.4 per cent growth to N1.165 billion by March 2020 compared with N975.98 million recorded in comparable period of March 2019. The top-line growth was driven by increased sales in its domestic Nigerian market. The company recorded growths across its two business segments of pharmaceuticals products and animal health products with the animal health products showing strong prospects for the top-line with 897.5 per cent growth during the period.

    Gross profit rose by 22.74 per cent from N450.74 million in 2019 to N553.26 million in 2020. While the company’s continued push for the market saw a relatively modest increase in marketing and distribution expenses, administrative expenses dropped by 10.84 per cent to N228.71 million in March 2020 as against N256.52 million recorded in comparable period of 2019. Profit after tax leapt by 938.5 per cent to N56.6 million by March 2020 compared with N5.45 million by March 2019. Earnings per share thus jumped from 0.29 kobo in March 2019 to 2.98 kobo by March 2020.

    Neimeth’s share price opened this week at the NSE at 86 kobo per share, representing an increase of 79.2 per cent on market value per share of 48 kobo recorded by the period ended March 31, 2020.

    The price appreciation might not be unconnected with increasing prospects of dividend payment in the current business year; after shareholders of the company at their annual general meeting earlier in March 2020 approved a balance sheet restructuring that would see the write off of accumulated losses and primed the company for dividend payment from net profit.

    Managing Director, Neimeth International Pharmaceuticals Plc, Pharm Matthew Azoji, said the half-year results built on steady growths witnessed in recent periods and further demonstrated that Neimeth is firmly on an upward growth trajectory.

    He said the results showed early gains of the company’s five-year strategic plan noting that the company would vigorously expand and reposition its businesses to cement its position as a leading player in not only Nigeria’s healthcare industry but also in the wider West African region while simultaneously ensuring good returns on investment to shareholders.

    According to him, the strategic direction for 2020-2024 would see the company implementing bold and gradual expansion initiatives including the upgrade of its factory at Oregun, Lagos state; development of new manufacturing facilities and expansion of the company’s marketing drive to Sub-Saharan Africa (SSA).

    Azoji, who was named among the top 25 CEOs in Nigeria by BusinessDay Newspaper and also won the sectoral leadership award of PEARL Awards, said the company is increasingly exploring viable options for strategic local and international partnerships to optimise its excess production capacity through contract manufacturing or direct product development.

    He reassured that the company remains focused on attaining the good manufacturing practice (GMP) certificate of the World Health Organisation, in line with its current strategic plan to be manufacturing hub for pharmaceuticals and healthcare products in Sub-Saharan Africa.

    “Our results show that we are on course to achieving our strategic growth objectives. We remain committed to our goal of repositioning the company to play greater roles in the healthcare industry, deliver better returns on investment to shareholders and greater benefits to all other stakeholders,” Azoji said.

    He said that the COVID-19 pandemic has further highlighted the importance of the healthcare industry adding that Neimeth will continue to explore safe ways of safeguarding people’s health through proactive investments in research and product developments.

    The six-month results built on first quarter performance and extended the positive outlook of the company. The first quarter report for the three-month period ended December 31, 2019 had shown that turnover leapt by 167.1 per cent to N606.5 million compared with N227.07 million recorded in comparable period of 2018. Gross profit quadrupled by 465.6 per cent from N53.52 million to N302.71 million. The company replaced operating loss of N119.3 million in December 2018 with operating profit of N111.68 million by December 2019. The bottom-line turned positive with a net profit of N82.65 million in December 2019 as against net loss of N139.16 million in December 2018. Earnings per share improved from a negative of 8.0 kobo to a positive of 4.35 kobo.

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    Neimeth had also seen considerable growths in the immediate past business year. The audited results for the year ended September 30, 2019 showed that Neimeth’s turnover rose from N2.27 billion in 2018 to N2.37 billion in 2019. Gross profit also indicated similar modest growth rising from N1.16 billion in 2018 to N1.20 billion in 2019. Operating profit rose by 47.9 per cent to N413.38 million in 2019 as against N279.42 million in 2018. Finance costs also declined from N112.96 million to N108.9 million. Profit before tax jumped by 82.9 per cent from N166.46 million in 2018 to N304.44 million in 2019. After taxes, net profit increased by 48.7 per cent from N148.02 million to N220.15 million. With these, earnings per share rose by 50 per cent to 12 kobo in 2019 as against 8.0 kobo in 2018.

    Performance ratios underscored significant improvements in the profitability of the company. While gross profit margin dropped from 51.1 per cent in 2018 to 50.6 per cent in 2019 due to industry-wide headwinds, operating profit margin, which denotes the company’s managerial ability to curtail headwinds and drive core business operations profitably, improved by five percentage points from 12.3 per cent in 2018 to 17.4 per cent in 2019. Pre-tax profit margin-which measures untaxed profit per unit of sales, nearly doubled from 7.3 per cent in 2018 to 12.8 per cent in 2019. Net profit margin, after taxes, also improved from 6.52 per cent in 2018 to 9.28 per cent in 2019.

     

  • United Capital raises N10b in first bond issue

    United Capital raises N10b in first bond issue

    By Taofik Salako

     

    United Capital Plc has raised N10 billion in new debt capital, breaking a new ground with its first bond issuance as the first issuing house to issue a corporate bond in the history of the Nigerian capital market.

    The Series 1 Bond was issued under the company’s N50 billion medium-term debt programme, which was registered with the Securities and Exchange Commission (SEC). The bond was oversubscribed by 24 per cent.

    Group Chief Executive Officer, United Capital Plc, Peter Ashade said the bond issuance solidifies the company’s performance record as a formidable ally in the investment banking industry.

    “With an oversubscription by 24 per cent investor orders, we believe this milestone accentuates the confidence in our Institution, and its ability to diversify our corporate funding sources, provide innovative financial solutions and our unwavering commitment to our esteemed clients,” Ashade said.

    Managing Director, Investment Banking, United Capital Plc, Babatunde Obaniyi, said the bond issuance added to the impressive portfolio of innovative and landmark transactions that the company had structured.

    According to him, the bond issuance again highlighted the company’s capabilities in the successful execution of novel debt capital market transactions.

    He noted that as a joint issuing house and book runner on the deal, the company advised on the transaction structure, securing regulatory approvals and marketing strategy for the bonds including market timing, investor road show and crafting an appropriate and compelling business case for the issuance.

    “The transaction, which has a tenor of five years, recorded a 124 per cent subscription, with huge commitments from a diversified institutional investors base including Pension Fund Administrators and other players in the financial service space. This very strong outcome further affirms buy-side investors’ confidence in United Capital Plc, and a testament to the leading role United Capital continues to play in the financial services space” Obaniyi said.

    Read Also: GSK Nigeria declares N657.7m dividends

     

    United Capital had started the 2020 business year with a well-rounded performance in the first quarter as the investment banking group recorded double-digit growths in all key performance indices.

    Key extracts of the interim report and accounts of United Capital for the three-month period ended March 31, 2020 showed that gross earnings rose by 32 per cent while pre and post tax profits grew by 53 per cent and 54 per cent respectively.

    Gross earnings rose to N1.92 billion in first quarter 2020 compared with N1.45 billion in first quarter 2019. Operating income rose by 40 per cent from N1.35 billion in 2019 to N1.89 billion in 2020. Profit before tax increased from N766.87 million in first quarter 2019 to N1.18 billion in first quarter 2020. After taxes, net profit rose from N644.17 million in first quarter 2019 to N991.29 million in first quarter 2020. Earnings per share for the three-month period thus increased from 11 kobo in 2019 to 17 kobo in 2020.

    The balance sheet also showed improved performance as total assets rose from N150.46 billion recorded by the year ended December 31, 2019 to N197.41 billion by March 2020. Total liabilities also rose from N130.88 billion in December 2019 to N176.69 billion by March 2020. Shareholders’ funds thus increased by six per cent from N19.59 billion in December 2019 to N20.72 billion in March 2020.

    The company attributed its top-line growth to significant increases in fee and commission incomes and net interest margin. The company’s fee and commission income rose by 55 per cent while net interest margin improved by 223 per cent.

    Cost to income ratio had improved significantly at 39 per cent in first quarter 2020 compared with 47 per cent in comparable period of 2019. With this, pre-tax profit margin improved to 61 per cent as the company continued to implement cost containment measures.

    United Capital had distributed N3 billion to shareholders as cash dividends for the 2019 business year. Shareholders received a dividend per share of 50 kobo.

  • Coronation Merchant Bank seeks N15b short-term capital

    Coronation Merchant Bank seeks N15b short-term capital

    By Taofik Salako

     

    Coronation Merchant Bank Limited is seeking to raise up to N15 billion in short-term capital through the issuance of commercial papers (CPs).

    Coronation Merchant Bank is offering Series 9 and 10 under its N100 billion commercial paper (CP) issuance programme. Application lists for the two offers opened on May 22, 2020 and will close on Friday May 29, 2020.

    The wholesale is offering 179-day CP with effective yield of 6.2500 per cent and a discount rate of 6.0646 per cent under its Ninth series. The 10th series CP is a 270-day instrument with effective and discount yield of 7.2500 per cent and 6.8817 per cent.

    Minimum subscription for the two offers is N5 million and thereafter in multiples of N1,000. The CPs, which are not subjected to withholding taxes, would be allotted on May 22, after the closure of the application list. Settlement date is June 1.

    The net proceeds of the new issues would be used to support the bank’s short-term funding requirements.

    Licensed by the Central Bank of Nigeria as a merchant bank, Coronation Merchant Bank has grown  with asset base and shareholders’ funds at N253.4 billion and N34.6 billion respectively, as at last December 31.

    The bank has A+ rating from Agusto & Co and A- rating from Global Credit Rating (GCR).

     

  • GSK Nigeria declares N657.7m dividends

    GSK Nigeria declares N657.7m dividends

    By Taofik Salako

     

    The Board of Directors of GlaxoSmithKline Consumer Nigeria Plc has recommended distribution of N657.7 million to shareholders as cash dividends for the 2019 business year. Shareholders will receive a dividend per share of 55 kobo.

    Key extracts of the audited report and accounts of GSK Nigeria for the year ended December 31, 2019 showed that turnover rose from N18.41 billion in 2018 to N20.76 billion in 2019.

    Profit before tax also improved from N1.16 billion to N1.17 billion. Profit after tax increased from N617.62 million to N917.10 million.

    GSK Nigeria engages in the manufacturing, marketing and distribution of a wide range of healthcare brands including consumer healthcare brands such as Panadol, Sensodyne, Andrews Liver Salt and Macleans and a range of pharmaceuticals including Augmentin,  Ampiclox and Amoxil; Zentel  and and vaccines.

    A breakdown of the dividend indicates that GlaxoSmithKline Plc (UK ), which holds 46.4 per cent equity stake through its wholly owned subsidiaries, Setfirst Limited and SmithKline Beecham Limited, will receive N305.2 million while Nigerian shareholders will receive N352.5 million as cash dividends.

    GSK Nigeria had in 2016 concluded a N22.6 billion divestment of its drinks business to the Japanese group, Suntory Beverage and Food Limited (SBF).

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    GSK Nigeria transferred the ownership to Suntory Beverage & Food Nigeria Limited, a subsidiary of the SBF, on October 1, 2016.

    The firm’s  drinks business included the two iconic brands-Lucozade and Ribena. The sale included the company’s business of manufacturing, bottling, marketing, distributing and selling of the Ribena and Lucozade brands in Nigeria and all assets attached to or deployed in connection with the business.

    Since then, the retained business of GSK Nigeria has been its consumer healthcare wellness, oral healthcare, nutrition and pharmaceutical and vaccines businesses.

    Following intense negotiations on May 31, 2016, GSK Nigeria and Suntory had agreed to the terms of the proposed sale of the drinks business for a headline price of $79.2 million.

    Suntory Beverage & Food Nigeria Limited is a subsidiary of the Japanese group, Suntory Beverage and Food Limited (SBF), a leading soft drinks company with total sales of £6.6 billion.

    The divestment deal had been approved by capital market regulators. Shareholders of GSK Nigeria had also on July 3, 2016 approved the divestment.

    At the extraordinary general meeting in Lagos, shareholders had approved the divestment and also empowered the board to pay a special dividend of N716 million to shareholders, representing 60 kobo per share.

    Tokyo-based Suntory Beverage had said it plans to acquire companies i n Southeast Asia, Middle East, Africa and Latin America to help double sales to 2.0 trillion yen by 2020.