The Nation Newspaper

Tag: outlines

  • Mobolurin outlines path to sustainable capital market growth

    Nigerian governments need to institutionalize a culture of policy stability and certainty and implement policies that will encourage savings and investments in equities funds in order to drive stable economic growth and development.

    A foremost investment banker and chairman, Capital Bancorp Plc, Mr Olutola Mobolurin said the current steep decline in the stock market was due majorly to perception of political risks and uncertainties around pre and post election periods as well as the low level of domestic capital available in the equities market.

    Addressing financial journalists yesterday in Lagos during the 30th anniversary of Capital Bancorp Plc, Mobolurin called for a complete review of strategy to boost investor confidence and build up long-term equities funds for the development of local industries.

    According to him, uncertainties in the economy and fear that 2019 general election might throw Nigeria into deep crisis were major factors that have led to massive dumping of shares by both foreign and Nigerian portfolio investors.

    He said government has a duty to address uncertainties at every level of its developmental efforts in order to rebuild investor confidence in Nigeria.

    “Everywhere in the world, politics and elections affect the stock market. I don’t think we should worry too much about it. However, people may worry about what can happen after the elections. It may turn some people totally away from Nigeria if they perceive us as an unstable country. If you scare people by giving them the impression that this is a country that is about to break up, that is where I see a problem. Politicians need to watch their utterances,” Mobolurin said.

    He said Nigerians must demand from the government and the politicians that they need stability in the political system, economy, and currency.

    “They must demand for low inflation because, that is where the prosperity of every citizen can be assured. If our system becomes more stable and we improve the environment for business and investment, even Nigerians who have money abroad will start bringing them back here,” Mobolurin said.

    He noted that there is apathy in the equities market from not only the foreign investors but also Nigerian investors pointing out that even pension funds managers have stopped investing in the stock market due to perceived high level of political risks and uncertainties.

    According to him, there are negative implications for all these uncertainties and apathy as equity investment represents the largest form of investment one could have, because it has no maturity date and the returns on equities is the residual returns from the company.

    “Equity investment has no coupon like debt instruments and for many other reasons; it acts as hedge against inflation. If everybody is investing in debt instruments, what will happen when interest rates falls? It is important that we have a strong stock market. The second thing is that if people perceive equity investment as risky and a no-go-area, the rate of capital formation in the country will decline. The only contribution to capital formation by a middle income person who will not be in business is his investment in the stock market,” Mobolurin said.

    He called for a comprehensive overhaul of the Nigerian financial system in a way that will allow the system to support economic growth.

    “There are ways we can save.  It may be corporate savings which can help to drive this economy. We should encourage private equity fund private funds to come up and we must find a way of getting every business to contribute to the growth of that industry. We need to get capital into the hands of those who have idea. We cannot satisfy 200 million people on the basis of importation. We must get this economy back to work,” Mobolurin, who is also chairman of NASD OTC Securities Plc, said.

    He attributed Capital Bancorp’s success story spanning 30 years of corporate existence to adherence to ethical standard and innovation.

    “We started Capital Bancorp on strong ethical values. We strive for professionalism as we invest in our people; train them to be knowledgeable and fair to everyone. We do everything in our power to adhere to regulations and to play by the rules,” Mobolurin said.

    Managing Director, Capital Bancorp Plc, Mr Higo Aigboje assured that the company would sustain its customer-focused approach by continuing to explore ways to satisfy customers.

    According to him, the company shall continue to uphold the ideals of its founding fathers which have kept it waxing stronger in the last 30 years. The company held its 30th Annual General Meeting yesterday where shareholders were rewarded with dividend.

  • Berger Paints outlines growth strategies

    Berger Paints Nigeria Plc yesterday outlined that product and distribution innovation and new investment to substantially grow sales and profitability.

    The board and management of Berger Paints Nigeria yesterday laid out the underlying dynamics of the company and its strategic growth direction at an interactive session with the investing public at the Nigerian Stock Exchange (NSE).

    Managing Director, Berger Paints Nigeria Plc, Mr Peter Folikwe said the company would focus on increasing its earnings and profitability by leveraging on its new automated factory and increase production output.

    He outlined that the company would seek to increase its market share, optimize return on investment (ROI) and implement risk management culture among others to ensure sustainable growth and returns to investors.

    According to him, top-notch and experienced management, high quality products, efficient market and strong distribution network, effective utilization of modern IT Technology and strong brands are some of the factors that enhance Berger Paints’ competitive edge.

    He noted that effective franchise growth and deployment of POS machine were among the key drivers that shall boost the company’s profitability.

    “We shall increase innovativeness and deepen routes to market to ensure that our products are available in most of the geo-political zones. Our outsourced business partners are being provided massive sales and marketing support to cause a desirable change in trade,” Folikwe said.

    Chairman, Berger Paints Nigeria Plc, Mr Abi Ayida said the company would review its business model to improve its processes and take advantage of investment opportunities in Nigeria irrespective of the challenges in the operating climate.

    He assured that the company would partner with the NSE in some of its corporate social responsibilities (CSR).

    Stockbrokers commended the company’s management for the presentation of facts behind the figures while Ayida rang the closing gong which symbolically closed the market.

    The NSE commended the management of Berger Paints for adhering to the post listing requirements, one of which requires regular provision of information by every quoted company to enable investors make investment decision.

    The Exchange advised the company to sustain its strategic and operational efforts aimed at ensuring shareholder value.

    Executive Director, Regulation, Nigerian Stock Exchange (NSE), Ms Tinuade  Awe assured that the Exchange remained committed to partnering with quoted companies as stakeholders in the market ecosystem.

    According to her, the Exchange aggregates all issues affecting quoted companies, including corporate governance and tax reform and play pivotal role to ensure smooth operation of the companies.

    She commended resilience of Berger Paints despite the tough operating climate.

  • Conoil outlines long-term growth plan to drive shareholders’ return

    Conoil Plc has outlined many initiatives that will drive long-term growth of the downstream oil company and deliver competitive returns to shareholders.

    At the annual general meeting in Uyo, Akwa Ibom State, the board and management of the company said Conoil would focus on further consolidation of its competitiveness in the different segments of its business with new investments in technologies, innovations and operating efficiency.

    The assurance came as shareholders unanimously approved the distribution of N1.4 billion cash dividend for the 2017 business year, representing a dividend per share of N2.

    In his address to the shareholders, Chairman, Conoil Plc, Dr. Mike Adenuga (Jr), said Conoil will maintain its leadership position in the downstream petroleum sector by building a stronger financial position and creating higher values for its shareholders.

    According to him, conscious efforts will be directed at achieving better execution of value-added products and services especially in the areas of marketing and customer management.

    “The company’s policy of continual investment and review of our business processes to boost efficiency has been paying off, as this has been a very important part of our success story. We have, for several years now, ensured that our strategy remained constant, proven and effective, which is designed to improve returns and grow value for shareholders by focusing on our market strengths without jeopardizing the development of our diverse portfolios,” Adenuga stated.

    He pointed out that the company’s focus going forward will develop emerging markets while holding its grounds in areas where it has achieved competitive advantage.

    He noted that in pursuit of further diversification of its portfolio, Conoil had introduced another brand of quality engine oil, Conoil Crown Heavy Duty Oil, which is manufactured specially for the mass market of car owners, into the market.

    “With the introduction of this product, we are poised to fill the yawning void in the industry as a pragmatic marketer of first choice,” Adenuga stated.

    He said the company will bring delightful innovations into the fuel retailing business in Nigeria to give greater value to its customers and shareholders.

    He noted that while the company has been expanding its retail network across the country, it has also been revamping its non-fuel retail business to achieve future growth targets.

    “I have no doubt that our strategies for growth are promising. We will remain disciplined in our approach as we work harder more than ever before to deliver value to our customers and expand our capabilities in all fronts,” Adenuga stated.

    Shareholders who spoke at the meeting commended the board and management of the company for its consistent dividend payment, despite the challenges in the industry. Conoil has maintained a consistent dividend payout history. Between 2012 and 2016, the company had paid a total of N8.4 billion as dividend.

    Key extracts of the audited report and accounts of the company for the year ended December 31, 2017 showed that turnover rose by 35.9 per cent from N85.02 billion in 2016 to N115.51 billion in 2017. Profits before and after tax however stood at N2.30 billion and N1.58 billion respectively in 2017. Earnings per share closed 2017 at N2.27.

  • Fidelity Bank outlines growth strategy

    Fidelity Bank outlines growth strategy

    Fidelity Bank Plc plans to grow its retail accounts to three million and deepen its deposit base by 20 per cent by the end of this year as it pursues a short-term strategy that focuses on underserved consumer banking segment and small businesses.

    Managing director, Fidelity Bank Plc, Mr. Nnamdi Okonkwo, yesterday at the Nigerian Stock Exchange (NSE) outlined the growth strategy and targets of the bank at a “Fact Behind the Figure” presentation to explain the underlying trends in the bank’s performance to the investing community.

    According to him, the bank is leveraging on emerging consumer credit bureaus and bank-wide risk management framework to provide loan products to grossly underserved consumer banking segment.

    He said the bank would be deepening its retail banking in growing its business in 2014 noting that the target is to grow retail accounts to three million accounts across 230 branches by the end of 2014.

    He pointed out that the bank would focus on strengthening its strategic alliances with various institutions including schools, microfinance banks and supermarkets to increase retail customers’ base.

    He added that the bank is starting aggressive deployment of smaller, cheaper, easily accessible and available branches that will focus on cheap deposit mobilization while it would also strengthen its lending and deposit mobilization in the Small Medium Enterprises (SMEs) and retail segments.

    “We offer these SME’s advisory services in terms of financial, technology and human resources solution.  There are a lot of concerns in these risk areas in the past but the future and success of banking in future goes to the retail and I assure you that we are taking steps to prepare ourselves. We are leaving a lot of returns for the customers because we don’t want to take risk. We have built capacity on this and we have put in place product and proper pricing to improve our bottom-line. We have put in a lot of resources. We are deploying customer relationship management system and business analytics tools to gain deeper customer insights and increased penetration ratio for our branded retail and electronic products,” Okonkwo said.

    He outlined that the bank would continuously increase its operating efficiency through consistent business processes while extending the leverage on the value chain of its corporate banking to extract maximum value from the commercial and retail businesses to achieve a 50:50 loan split between corporate and commercial loan.

    According to him, the bank is targeting between 15-20 per cent on tax rate, 20 per cent average on deposit growth, 15-20 per cent average on loan growth, 30-35 per cent on proposed dividend and 10 per cent growth on Return on investment (ROE).

    He added that the bank would also deepen its participation in the fast-growing and key sectors of the economy especially energy, oil and gas and telecommunications by leveraging its enhanced balance sheet and expanded distribution network.

    “If anybody is interested in buying a stock that shows consistent return, stable management, stable liquidity and increased capital base, it is a good time and now to buy Fidelity bank stock because we are taking this bank somewhere,” Okonkwo said.

    He blamed the decline in the bank’s net bottom-line in 2013 on increased costs and constrained income sources noting that a clawback of N4.4 billion on previously sold loans to Asset Management Company of Nigeria (AMCON) and increased levy due to AMCON as well as a one -off additional provision of N1.8 billion in respect of actuarial valuation on gratuity and pension obligation negatively impacted profit.

    Audited report and accounts of the bank for the year ended December 31, 2013 showed profit before tax of N9.03 billion, representing a 57.7 per cent decline from the N21.35 billion recorded in 2012. Gross earnings increased slightly by 6.5 per cent to N126.92 billion in 2013 as against N119.14 billion recorded in 2012.

    Net interest income had dipped by 16.3 per cent to N30.81 billion as against N36.81 billion in previous year, as the bank struggled with spillovers that emanated from tightened monetary conditions, which increased cost of funds. Non-interest income meanwhile recorded a modest growth of 4.0 per cent to N40.66 billion in 2013 compared with N39.10 billion in 2013. This was also impacted by the new tariff regime introduced by the CBN in second quarter of 2013. The report showed that operating expenses rose by 8.1 per cent to N54.82 billion as against N50.71 billion.

    Meanwhile, the balance sheet of the bank firmed up as total assets rose by 18.2 per cent from N914.36 billion in 2012 to N1.08 trillion in 2013. Total customer deposits increased by 12.5 per cent from N716.75 billion to N806.32 billion while net loans and leases grew by 23.3 per cent to N426.08 billion as against N345.50 billion in previous year. Shareholders’ funds closed the year at N163.46 billion.

  • 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

  • Lawyer outlines shortcomings of PIB

    Lawyer outlines shortcomings of PIB

    A legal expert on oil and gas, Emeka Okwosa, yesterday outlined some shortcomings of the Petroleum Industry Bill (PIB) 2012.

    He called for the emplacement of proper measures to ensure the effectiveness of the bill.

    Okwosa spoke at a lecture he delivered at this year’s annual Law Week celebration, organised by the Lagos branch of the Nigerian Bar Association (NBA).

    President Goodluck Jonathan, on July 18, last year, presented the PIB to the National Assembly for consideration and enactment. The bill has scaled the second reading in both chambers of the National Assembly.

    Okwosa said the PIB, originally introduced in December 2008, had undergone numerous revisions which have been the subject of intense debates.

    The lawyer said there were myriad of shortcomings in the bill, which need to be redressed to forestall hindrances in implementation.

    He said: “The new PIB empowers the President to unilaterally grant discretionary oil licences under special circumstances, without a competitive bid process.

    “It also gives wide powers to the Petroleum Minister to revoke leases unconditionally and to do ‘all such other things, incidental to the performance of its function’.

    “The bill does not provide any mechanism to check the abuse of these powers.”

    Okwosa noted that the PIB mandates oil companies to remit 10 per cent of their net profits to host communities as compensation.