Category: Investors

By Taofik Salako, Deputy Business Editor

The board of Mutual Benefits Assurance Plc has assured that the company has capacity to maintain stable operations over the long-term irrespective of the impact of the coronavirus (COVID-19) pandemic.

In a regulatory filing at the Nigerian Stock Exchange (NSE), directors of the company assured stakeholders and customers of the stability of the company in the long-term, irrespective of the impact of the Coronavirus pandemic across the country.

According to the company, it has implemented some measures to ensure that its business operations remain stable while monitoring developments closely as they unfold to ensure continued sustainability as well as delivering of long-term value to stakeholders.

The company noted that the economic impact of pandemic on its business in first quarter 2020 was quite minimal, although the bigger concern remains the effect of the pandemic on the macro-economic environment, especially, underwriting profits, investment income and growth prospects.

Mutual Benefits stated that it would continue to review the trends and share insights on the impact of COVID-19 on micro and macroeconomic indices to enable its clients and other stakeholders make good business and personal decisions that may help during and after the pandemic.

“We have leveraged technology to enable our customers carry out their business transactions with us unhindered. We had proactively activated remote working for our core operations staff ahead of the lockdown as a responsible corporate citizen in keeping with global health protocols on social distancing,” Mutual Benefits stated in the filing signed by its Company Secretary, Jide Ibitayo.

The company outlined that it had activated remote working for its staff in order to ensure that the needs of its stakeholders are met regardless of the lockdown and restriction of movements.

“This has greatly enabled our business to continue with minimal disruption and our investments in ICT over the years have not been in vain. We have also received the assurance of our support service providers who have also continued to operate remotely to meet our needs which gives us assurance that our operations will not be materially impacted,” Mutual Benefits stated.

The company expressed optimism that Nigeria will come out of the pandemic a stronger and healthier nation.

By Taofik Salako, Deputy Business Editor

The Nigerian Stock Exchange (NSE) has launched a process to amend its listing requirements to enhance price discovery and liquidity for new listed securities and protect investors from supply-driven price manipulation and misinformation.

Under the proposed amendment,  undergoing rule-making process, companies seeking to list by way of introduction or any other method at the Exchange must make available shares or securities for trading on the day of listing as well as provide the investing public with updated financial statements and other material information.

Listing by introduction is a method of listing where the company making initial listing of its shares has no subsisting offering of its shares or securities to investors and no additional capital is being raised from the market at the time of listing.

The proposed amendment comes on the heels of intense concerns generated by the listing by introduction of MTN Communications Nigeria Plc, with several analysts attributing the steep rise in the share price of the telecommunications company to non-supply of shares.

Under the arrangement, a company listing by introduction is not required to provide any shares for trading, raising concerns about possibility of manipulation of initial demand for shares without supply as pretense for a price rally.

According to the proposed amendments, on the day of listing of equity securities excluding public offerings, the company shall make available for trading a sufficient amount, but not less than 10 million shares or units or one per cent of its outstanding shares, whichever is greater, or such volume or value of shares as may be determined by the Exchange.

Also, each company seeking to list its securities on the Exchange shall publish the approved information memorandum or the listing prospectus approved by the Securities and Exchange Commission (SEC) as well as its latest audited and unaudited financial statements, which shall not be more than nine months old.

Such company will be required to publish the information on its website not later than 48 hours before the listing date and also on the NSE’s Issuers’ Portal not later than 48 hours after being listed on the Exchange.

NSE Executive Director, Regulation, Tinuade Awe said the proposed amendments were to address concerns about availability of shares for trading on the day a company is listed by introduction.

According to her, the proposed amendments will provide a clearer description of listing by introduction and impose an obligation on prospective issuers of equity securities -excluding public offerings, to make a reasonable volume of shares available for trading on the day of listing.

She added that the proposed rules would address concerns for sufficient information about a listing company’s financial position on the day of listing in order to give prospective investors a basis for trading in the company’s shares.

“Consequently, additional amendments are being proposed to ensure that issuers provide their information memorandum or SEC-approved prospectus, as well as their latest financial statements to the market by publishing same on their websites at least 48 hours before the listing, to enable investors to make informed investment decisions regarding the issuer,” Awe stated.

By Taofik Salako, Deputy Business Editor

The Chairman of Wapic Insurance Plc, Mr Mutiu Sunmonu, has promised to build on the enviable profile of the insurance growth and provide leadership to achieve the second phase of the group’s growth plan.

Sunmonu’s appointment was announced on Monday by the Board . The new chairman is a former managing director of Shell Petroleum and Development Company (SPDC) of Nigeria.

Sunmonu succeeds Aigboje Aig-Imoukhuede, who retired on April 27 after eight years as chairman of Wapic Insurance and its subsidiary, Wapic Life Assurance Limited.

Mr Bababode Osunkoya was also appointed as chairman of Wapic Life Assurance Limited.

In a regulatory filing signed by Company Secretary, Wapic Insurance Plc, Mary Agha, the board noted that the board-leadership transition heralds the second phase of the group’s growth plan, which is focused on extending its culture of distinction in service excellence, innovation, technology, sustainability practices and operational efficiency.

According to the company, during the first transformation phase under Aig-Imoukhuede’s leadership, Wapic Insurance and Wapic Life Assurance implemented a number of transformational initiatives that stabilised and returned the 62-year-old company to profitability and enabled Wapic to take its place amongst Nigeria’s top 10 underwriting companies.

The board pointed out that as Wapic Insurance moves on to the next phase of transformation, both Sunmonu and Osunkoya, who are respected business leaders with extensive board experience in various organisations across multiple sectors of the economy, are expected to lead the group to greater position.

According to the company, over the next five years, Wapic Insurance and its subsidiaries aspire to a top three position in the Nigerian insurance industry and to expand operations further across the West African sub region.

Sunmonu said he would build on the legacy of achievements and lead the management and employees to actualise the second phase of the company’s growth plan.

By Taofik Salako, Deputy Business Editor

The Bank for International Settlements (BIS) has released its global liquidity indicators for the period ended December 31, 2019.

The report showed that US dollar credit to non-bank borrowers outside the United States grew by six per cent to $12.2 trillion by the end of 2019.

The yearly growth rate of euro-denominated credit outside the euro area slowed to six per cent while that of yen-denominated credit outside Japan turned negative at –1.0 per cent.

Also, in 2019, euro-denominated credit overtook US dollar-denominated credit as the largest stock of foreign currency credit to emerging Europe.

Meanwhile, the report indicated that the debt securities share in US dollar credit outside the United States has risen considerably over the past decade across a number of major borrowing regions.

By Taofik Salako, Deputy Business Editor

Guaranty Trust Bank (GTBank) Plc sustained modest growths across key performance indices in first quarter with pre-tax profit rising to N58.2 billion within the three-month period.

Key extracts of the unaudited three-month report for the quarter ended March 31, 2020 released yesterday at the Nigerian Stock Exchange (NSE) showed that profit before tax rose from N56.98 billion from first quarter 2019 to N58.20 billion in first quarter 2020. After taxes, net profit also improved from N49.30 billion in first quarter 2019 to N50.07 billion in first quarter 2020.

Earnings per shares increased from N1.74 in first quarter 2019 to N1.77 in first quarter 2020. Net interest income had risen from N58.22 billion to N64.28 billion, counterbalancing the decline in net fee and commission incomes, which dropped from N18.01 billion to N13.55 billion.

GTB distributed N82.4 billion to shareholders as cash dividends for the 2019 business year after it made history with the conduct of first-ever proxy Annual General Meeting (AGM).

Shareholders received a final dividend per share of N2.50 in addition to interim dividend of 30 kobo paid earlier, bringing the total dividend per share for the 2019 business year to N2.80. The bank had distributed N80.94 billion as cash dividend for the 2018 business year, representing a dividend per share of N2.75.

The first quarter 2020 performance was in line with the steady modest performance outlook of the bank, in spite of industry headwinds and macroeconomic challenges. Key extracts of the audited report and accounts for the year ended December 31, 2019 showed modest growths across key performance indices. Gross earnings rose from N434.7 billion in 2018 to N435.31 billion in 2019. Profit before tax increased by 7.5 per cent from N215.6 billion to N231.7 billion. After taxes, net profit improved from N184.71 billion to N196.87 billion. Earnings per share thus increased from N6.54 in 2018 to N6.96 in 2019.

The balance sheet also indicated improvements in banking activities and market share. Loans grew by 19 per cent from N1.26 trillion in 2018 to N1.50 trillion in 2019. Customers’ deposits increased by 11.4 per cent to N2.53 trillion in 2019 as against N2.27 trillion in 2018. Total assets and shareholders’ funds stood at N3.76 trillion and N687.3 billion respectively. Full impact capital adequacy ratio (CAR) remained strong at 22.5 per cent.

The proportion of non-performing loan to gross loans improved to 6.5 per cent in 2019 as against 7.3 per cent 2018, implying improvement in the bank’s asset quality. Cost of risk (COR) remained flat at 0.3 per cent. Complementing the improvement noted in non-performing loans, the bank maintained adequate loan loss coverage of 126.6 per cent for lifetime credit impaired loans compared to 105.1 per cent in 2018.

In a review of the results, Managing Director, GTBank, Mr. Segun Agbaje, said GTB exists to provide excellent service to its customers and generate the returns that shareholders expect.

He said the bank’s strong financial performance in 2019 demonstrates that it is delivering on both customers and shareholders’ expectations.

“We achieved healthy growth across all our major businesses despite varying degrees of uncertainty and volatility, and we are making progress in positioning our business for long-term growth in the face of a rapidly changing competitive landscape,” Agbaje said.

According to him, underpinning the bank’s strong financial performance is its commitment to being there for its customers when it matters most.

“That is why, powered by the fundamental strength of our brand, and guided by our strategy of putting our customers at the centre of everything we do, we will continue to design and deliver financial services that not only solves our customers’ real pain points but also leaves them better after every interaction,” Agbaje said.

He pointed out that the bank continues to be best-in-class in the Nigerian banking industry in terms of financial ratios with post-tax return on equity (ROAE) of 31.2 per cent, post-tax return on assets (ROAA) of 5.6 per cent and cost to income ratio of 36.1 per cent.

According to him, these ratios reflect the experienced management, and efficient balance sheet structure coupled with operational efficiency of the bank.

By Taofik Salako, Deputy Business Editor

Cadbury Nigeria Plc drew on its internal efficiency and top-line cost management to grow first quarter profit by 26 per cent in spite of eight per cent decline in sales.

Key extracts of the interim report and accounts of Cadbury Nigeria for the first quarter ended March 31, 2020 released yesterday at the Nigerian Stock Exchange (NSE) showed that net profit rose by 26 per cent to N638.94 million in first quarter 2020 as against N506.75 million recorded in comparable period of last year.

Earnings per share thus increased by 26 per cent from 26.98 kobo in first quarter 2019 to 34.02 kobo in first quarter 2020. Profit before tax had risen by 26 per cent from N723.93 million to N912.77 million. Turnover, however, declined by eight per cent from N9.28 billion in first quarter 2019 to N8.55 billion in first quarter of 2020.

The board of directors of Cadbury Nigeria recently recommended payment of N920 million to shareholders as cash dividends for the 2019 business year, second consecutive year of significant dividend growth.

Shareholders will receive a dividend per share of 49 kobo, representing 96 per cent on the payout for the 2018 business year. The company had distributed N471 million to shareholders as cash dividend for the 2018 business year. Shareholders received a dividend per share of 25 kobo for the 2018 business year as against 16 kobo paid for the 2017 business year..

The dividend was one of the highlights of the audited report and accounts of Cadbury Nigeria for the year ended December 31, 2019. Key extracts of the report showed appreciable growths across key performance indicators.

Total turnover rose from N35.97 billion in 2018 to N39.33 billion in 2019. Profit before tax also increased from N1.22 billion to N1.54 billion while profit after tax jumped from N823 million in 2018 to N1.07 billion in 2019.

The 2019 report further strengthened the performance outlook of the food company, after it posted three-digit growths in profitability in 2018. The audited report and accounts of the company for the year ended December 31, 2018 had shown that the company’s full-year profit before tax surged by 242.9 per cent to N1.2 billion in 2018 as against N350 million in 2017. Net profit rose by 174 per cent from N299.9 million in 2017 to N823 million in 2018.

In a review, Chairman, Cadbury Nigeria Plc, Mr. AtedoPeterside, told shareholders that the company’s positive performance was driven by success of its cost-cutting measures, effective marketing strategy, and superlative performance of its various brands.

Cadbury had last year appointed Mrs. OyeyimikaAdeboye as Managing Director with effect from April 1. Mrs Adeboye was the first woman to be appointed Managing Director since the establishment of Cadbury Nigeria over five decades ago.

Mondelçz International, a global snacking powerhouse, holds 74.99 per cent majority equity stake in Cadbury Nigeria Plc, while the remaining 25.01 per cent are held by a diverse group of Nigerian individual and institutional investors.

By Taofik Salako, Deputy Business Editor

Stanbic IBTC Holdings Plc sustained modest growths in the top-line and bottom-line in the first quarter as pre-tax profit rose by 3.8 per cent to N24.4 billion.

Key extracts of the interim report and account of the financial services holding company for the three-month period ended March 31, 2020 showed modest growths across key performance indicators.

Gross earnings rose to N61.42 billion in first quarter of the year as against N58.69 billion recorded in first quarter of last year. The top-line growth was majorly driven by increase in fee, commission and trading incomes as interest income dropped from N31.14 billion in first quarter 2019 to N27.46 billion in first quarter 2020.

Profit before tax improved slightly from N23.51 billion to N24.41 billion. After taxes, net profit increased from N19.15 billion in first quarter 2019 to N20.60 billion in first quarter 2020. With these, earnings per share inched up to N1.91 in first quarter 2020 compared with N1.81 in comparable period of 2019.

The first quarter performance indicates a modest performance outlook for the group in the current business year. Stanbic IBTC Holdings had recorded a net profit of N75.04 billion in 2019. The board of the holding company subsequently recommended payment of N21 billion as dividend for the 2019 business year, implying a dividend per share of N2, 33.3 per cent increase on N1.50 per share paid for the 2018 business year.

Key extracts of the audited report and accounts for the year ended December 31, 2019 had shown that gross earnings rose from N222.36 billion in 2018 to N233.81 billion. Profit before tax increased from N88.15 billion in 2018 to N90.93 billion in 2019. Profit after tax also improved marginally from N74.4 billion to N75.04 billion. Earnings per share however dropped from N7.04 in 2018 to N6.92 in 2019. The decline in earnings per share was due to additional shares due to cash-to-scrip dividend conversion policy of the company.

In a recent review, Chief Executive Officer, Stanbic IBTC Holdings Plc, Yinka Sanni, while acknowledging that the regulatory and economic environment could sometimes be challenging, said the company remained resolute in its target to emerge as Nigeria’s leading end-to-end financial solutions provider.

“While we look to 2020 with great optimism, we are fully aware of the challenging macro-economic and regulatory headwinds that we must contend with as we enter a new decade. Nonetheless, our strategic journey towards becoming the leading end-to-end financial solutions provider by 2023 continues as we leverage our universal capabilities whilst focusing on cost management, digitilisation and client centricity in accelerating growth in 2020,” Sanni said.

He added that the Stanbic IBTC continues to benefit from its adoption of a digital strategy as well as operating a holdings company structure which enables subsidiaries to cross-sell and also leverage expertise within the group.

Stories by Taofik Salako, Capital Market Editor

The board of Fidson Healthcare Plc has assured shareholders that ongoing expansion and business growth initiatives would continue to strengthen the performance of the healthcare company in the years ahead.

Addressing shareholders at the Annual General Meeting (AGM) in Lagos, Chairman, Fidson Healthcare Plc, Mr. Segun Adebanji, said the company has continued to strengthen its operating facilities through expansion and retooling.

According to him, old machines and equipment have been replaced with modern ones as the company repositions through business realignment and useful industry collaboration in order to take advantage of the growth opportunities in the market.

“We are currently expanding our capacity utilization through increased production and contract manufacturing for other notable companies in the industry,’’ Adebanji said.

He pointed out that the company has also continued to leverage on its World Health Organisation (WHO)-certifiable factory as it recently entered a partnership with GlaxoSmithKline (GSK) that will see it manufacture for GSK’s West African operations going forward.

He added the strategic partnership and other market penetration strategy and cost optimization were some of many initiatives to sustain growth and return value to shareholders of the company.

He noted that with the conclusion of the company’s rights issue earlier this year, the company has already taken steps to improve its financial structure in line with the purpose of the new capital raising, which was aimed at refinancing expensive debt and working capital funding in a bid to improve margins.

At the meeting, shareholders approved payment of a dividend per share of 15 kobo. The company’s turnover rose by 15 per cent from N14.06 billion in 2017 to N16.23 billion in 2018. Profit before tax however dropped to N160.9 million in 2018 as against N1.6 billion in 2017. The decline was attributed to increased cost of sales margin from 49 per cent in 2017 to 61 per cent in 2018 and 92 per cent increase in finance cost.