The Nation Newspaper

Tag: Q3

  • Sterling Bank grows Q3 pre-tax profit by 41% to N8.5b

    Sterling Bank Plc recorded impressive growths in the top-line and bottom-line in the third quarter as the bank’s continued to optimize the potential of its core banking operations and overall profitability of its business.

    Interim report and accounts of the bank for the third quarter ended September 30, 2014 showed that while gross earnings grew by 12.1 per cent, net interest income rose by 32.8 per cent. This further bloomed into 41.3 per cent and 39.2 per cent in pre and post tax profits respectively.

    Gross earnings closed September 2014 at N73.01 billion as against N65.12 billion recorded in comparable period of 2013. Net interest income rose from N24.22 billion in third quarter 2013 to N32.1 billion in third quarter 2014. Profit before tax jumped to N8.50 billion in 2014 as against N6.02 billion in 2013. After taxes, net profit rose from N5.07 billion to N7.06 billion.

    The bank’s pre-tax profit margin rose from 9.24 per cent in third quarter 2013 to 11.6 per cent in September 2014, underlying the improving profitability of the bank.

    In his remarks, managing director, Yemi Adeola, said the performance of the bank was driven by increasing brand acceptability as shown in its growing revenues and reduction in impairment charges.

    According to him, as part of the initiatives to support its retail banking proposition, the bank has re- aligned its business by market segments for a more focused market reach while it has continued to increase its transaction channels and it is on track to deliver additional 21 branches and 500 Automated Teller Machines (ATMs) by the end of the year.

    “Following our Extra-ordinary General Meeting billed for November 11, we plan to conclude the ongoing private placement before the end of the year. This will put us in a strong competitive position to achieve our growth plans in coming quarters. In the meantime, we remain focused on efficiency and are optimistic that the full year returns will be in line with our earlier Management guidance,” Adeola said.

    He noted that the 41 per cent growth in profit before tax despite pressures on earnings arising from monetary policy changes was driven by improvements in revenues and a 30 per cent reduction in impairment charges.

    According to him, interest income increased by 15 per cent, while interest expense declined by three per cent resulting in a 32 per cent growth in net interest income. The bank recorded a 20 per cent growth in total assets to N847 billion and a 19 per cent growth in deposits to N679 billion with a 100 basis points reduction in cost of funds to 4.9 per cent.

  • Transcorp doubles profit to N10b in Q3

    Transnational Corporation of Nigeria (Transcorp) Plc continued in its strides in the third quarter as the conglomerate again doubled its turnover and profit, increasing the prospects for better returns in 2014.

    Key extracts of the interim report and accounts of Transcorp for the nine-month period ended September 30, 2014 showed that turnover leapt by 166.55 per cent. Gross profit rose by 129.6 per cent while operating profit doubled by 112.7 per cent. The conglomerate’s profit before tax grew by 88.5 per cent while profit after tax rose by 130.7 per cent.

    Transcorp’s turnover rose to N31.40 billion in September 2014 as against N11.78 billion in comparable period of 2013. Gross profit also rose from N9.20 billion to N21.12 billion. Operating profit stood at N12.36 billion in 2014 compared with N5.81 billion in 2013. Profit before tax jumped from N5.15 billion to N9.71 billion while profit after tax doubled from N3.58 billion to N8.26 billion.

    The third-quarter performance underlined the continuous improvements in the earnings of the conglomerate in recent period. Interim report of Transcorp for the six-month period ended June 30, 2014 had shown that turnover rose by 177 per cent while group operating profit and pre-tax profit jumped by 145 per cent and 122 per cent respectively.

    The report showed that turnover doubled to N21.2 billion in June 2014 as against N7.67 billion recorded in comparable period of 2013. Gross profit rose from N5.99 billion in first half 2013 to N14.96 billion in first half 2014. Operating profit for half year 2014 was N9.75 billion as against N3.99 billion in comparable period of 2013. Group profit before tax doubled to N8.02 billion in 2014 compared with N3.61 billion in corresponding period of 2013. After taxes, net profit rose from N2.48 billion in 2013 to N6.89 billion in 2014.

    The board of Transcorp recently appointed Mr. Emmanuel Nnorom as the president and chief executive officer of the conglomerate with a mandate to push the conglomerate’s profit to $1 billion by 2018.

    Nnorom took over on September 1, 2014. He succeeded Mr. Obinna Ufudo, who had led the conglomerate since 2011.

    Chairman, Transnational Corporation of Nigeria (Transcorp) Plc, Mr. Tony Elumelu, said the change was meant to further consolidate the growth of the company noting that the outgoing chief executive had laid a good foundation by delivering on the corporate objectives under the phase one of the corporate transformation.

    “In his three years as CEO of the Transcorp Group, Obinna Ufudo laid a strong foundation of good governance, achieved significant financial returns for the company and played a key role in transforming an ailing enterprise, into an emerging investment powerhouse, with a market capitalisation of over US$1.2bn.  He will be handing over a transformed business to Emmanuel Nnorom. With the implementation of Phase 2 of our strategic intent, we expect accelerated growth in all spheres of our business, with a clear objective of $1 billion in profits by 2018,” Elumelu stated.

  • LCCI laments drop in Business Confidence Index in Q3

    Nigeria’s Business Confidence Index (BCI) dropped from 19.4 per cent in the second quarter of the year to 14.3 per cent at the end of the third quarter, a report by the LCCI, has said.

    In the report made available to The Nation, the body said the drop in aggregate BCI represents 5.1 per cent  slack of the confidence level among business operators in the last three months. The index had fluctuated over the last two quarters (10.5 per cent in Q1 and 19.4 per cent in Q2, 2014), the group said.

    BCI is a leading economic indicator designed to measure the degree of optimism on the state of the economy that business leaders are expressing through their activities of investing and spending.

    LCCI lamented that the drop of the BCI scores suggested that business leaders were largely pessimistic about expanding their investments over the next few months. The group said Nigeria’s BCI scores over the years continue to trail below the 50 per cent global business confidence.

    “Investors and business leaders remain wary about the state of the economy and the challenging business environment,” LCCI said.

    LCCI listed the key factors that mostly depressed the confidence level of business leaders as security challenges, political transition/electioneering and associated risks; cargo clearing issues and access to and from the nation’s foremost ports – Apapa and Tin Can; policy uncertainties and regulatory concerns; and worsening public power supply.

    The group noted that all sectors reported positive business confidence levels in third quarter. It said  the manufacturing sector posted a positive confidence level of four per cent for the second time over the last seven quarters. “This sector has consistently remained at the bottom of BCI league table by steadily recording negative confidence levels. Medium and small manufacturing enterprises are the most hit by the lingering challenges constraining productive activities in the country,” LCCI said.

    The Chamber said the most disturbing factors for manufacturers include power supply, logistics,  influx of imported and substandard products, preference for imported goods by Nigerians, low access to credit, high cost of doing business, inadequate infrastructure  and inhibitive activities of government regulatory/monitoring agencies.

    It, however, said the financial sector (banks, e-payment operators, finance houses and Bureau De Change, BDCs) continue to top the league table of business optimism with 32 per cent BCI score in the third quarter.

    It noted that impressive corporate reported for the period, which ended on June 30, this year and the recovery of the nationalised banks contributed to the sustenance of optimism among the financial sector operators.

    The impact of the recapitalisation of the BDCs and finance firms would be seen over the subsequent quarters, it said.

    LCCI noted that the optimism among players in the agricultural sector, which was relatively strong in first and second quarter, is beginning to moderate. “This is a pointer that operators expectation in the agricultural sector is beginning to wane. The BCI third quarter 2014 survey confirmed an increasing level of uncertainty among the private sector players due to rising electioneering activities and the build up to the 2015 general elections,” the survey said.

    LCCI also said the operators in the oil and gas sector are mostly disturbed by the uncertainty surrounding delayed passage of the Petroleum Industrial Bill (PIB) coupled with the emerging developments in the global oil and gas market. Also, long delay in releasing the 2014 budget, influx and rising patronage of offshore advisers and business consultants in the country were attributed mostly as the concern of players in the professional business services sector.

    In Information Communication and Telecommunication (ICT) sector, LCCI said insecurity, double taxation, regulation and monitoring issues were on the top of concerns for operators.

  • ‘Govt records N459.1b budget deficit in Q3’

    The nation’s budget deficit more than doubled in the third quarter to N459.1 billion ($2.9 billion), the Central Bank of Nigeria (CBN) has said.

    The budget deficit of sub-Saharan Africa’s second-largest economy jumped from N211.8 billion in the previous three months and N161.1 billion in the third quarter of 2011, the Abuja-based bank said in a report on its website.

    “The deficit was financed mainly from domestic sources, particularly through the issuance of additional Federal Government of Nigeria bonds,” the bank said.

    The country increased its target for this year’s budget deficit to 2.97 per cent of economic output in February, from a 2.77 per cent target announced in December 2011, after it added N733 billion of spending on fuel subsidies, according to the Finance Ministry.

    The country wants to narrow the fiscal deficit to 2.2 per cent of GDP next year, according to the October 10 budget proposal by President Goodluck Jonathan.

    During the period, N26.2 billion were withdrawn from the excess crude account “to bridge the shortfall in revenue for the period,” leaving $9.3 billion in the account, in which Nigeria saves revenue from crude sales higher than the budgeted price, the bank said.

    The government aims to raise savings in the account to $10 billion to provide a buffer against global economic uncertainty. Net foreign-currency inflows through the bank in the quarter stood at $5.8 billion, with inflows at $14.4 billion and outflows at $9.2 billion, according to the report.

  • Consolidated Hallmark pays over N600m claims in Q3

    Consolidated Hallmark pays over N600m claims in Q3

    Consolidated Hallmark Insurance PLC (CHI) paid over N600 million claims at the end of the third quarter, its Managing Director, Eddie Efekoha, has said.

    He disclosed this at the presentation of Group Accident Insurance Cover to members of the National Association of Insurance Correspondents (NAICO) in Lagos. He added that the company is committed to meeting policy holders’ expectations.

    Efekoha said the company takes payment of claims as a priority because the value it places on its clients, adding that the company will always ensure that its underwriting is healthy and professionally handled.

    He stated that insurance is driven by referrals and customers’ recommendation.

    He said: “For us as a company, we recognise that we are in business to pay claims. Therefore, we must operate and ensure we do not fail. When we do that, satisfied clients will recommend themselves and other people to us. So it’s a business that is built on referrals such that existing clients will refer you when you have done well and we will continue to do that in the mist of changing environment.”

    He noted that despite the harsh business environment and challenging regulatory regime, the company has continued to witness upward movement in growth fundamentals.

    He said the firm is happy with where it is, having achieved a very modest growth, stressing that the key driver of its business from the start is its people including the staff and the board.

    He noted that the weight of premium receivables in the industry has been a challenge to operators under a changing regulatory regime.