The Nation Newspaper

Tag: Shareholders

  • New chief executive assures Chams’ shareholders of better returns

    The new Managing Director of Chams Plc, Mr. Olufemi Williams, has assured shareholders that the management would build on the legacy of the past three decades by implementing strategies and developing product portfolio that would ensure stable growth and increased returns.

    Williams took over from the founding group managing director Mr ‘Demola Aladekomo, who retired on September 18, 2015. Prior to his appointment, Williams was the deputy managing director, and a Chams Plc veteran having joined the company in 1990 as a computer engineer. He rose to the position of general manager in January 2001, and held same until he joined SuperCard Limited as managing director in March 2004.

    Williams was appointed deputy managing director, Chams Plc in January 2012 after the merger of SuperCard Limited with Chams Plc.

    In a chat with The Nation, Williams said Chams has remained on positive growth trajectory, noting that shareholders could look forward to better dividend payout and profitability by the end of the current business year, ending December 31, this year.

    According to him, Chams is on course to delivering better results and dividends in the current business year as it has continued to witness improved performance.

    Williams said the company has refocused on building new solutions that will provide stable and large products portfolio that can drive sustained performance. The new innovative products from the company include “confirm me”, a status verification system that provides various information about a person including credit status, certificates and membership among others.

    He said the new management would build on the legacy of the Aladekomo’s years and the company would remain focused on its long-term strategic growth plan.

    According to him, Chams is currently running on a 10-year strategic plan that details key objectives and performance requirements for everybody in the company, from directors to management, giving the company stability and inclusive growth.

    Aladekomo retired at the weekend after three decades of nurturing the start-up information and communication technology (ICT) company into a publicly quoted company. Aladekomo, a pioneer in the Nigerian ICT and past president and fellow of Nigeria Computer Society, founded Chams in 1985 and successfully nurtured the company from a start-up firm into a publicly quoted industry giant. Chams was quoted on the Nigerian Stock Exchange (NSE) in 2008.

    Aladekomo’s retirement coincided with the 30th anniversary of Chams and represented a generational shift as Williams, took over the management of Chams. Aladekomo had led a team of directors and top management of Chams to a commemorative closure of trading at the Exchange last Thursday, his last working day at Chams.

    Speaking during the visit to the Exchange, Aladekomo said he was leaving Chams as a stable company in capable hands, assuring that the company would continue to improve on its fundamental performance and returns to investors.

    He noted that with the successful transition from the founding managing director to another Chams-groomed managing director, the company has crossed another milestone and further cemented its position as a leader in the ICT sector.

    “I am leaving behind a company with stronger growth prospects. I am leaving behind a very strong management team led by My Olufemi Williams and we have a highly experienced board, so the company is pretty strong,” Aladekomo said.

    While thanking all stakeholders for their supports, Aladekomo assured that he would continue to support the group and the development of the Nigerian ICT industry. Aladekomo will be serving as a non-executive director on the board of Chams Group.

    Aladekomo’s retirement came as recent strategic initiatives appeared to be impacting positively on the fundamentals of the company. Key performance indices of the company showed appreciable improvements in overall performance outlook during the year ended December 31, 2014.  Turnover rose from N3.44 billion in 2013 to N4.12 billion in 2014. While gross profit slipped from N1.85 billion to N1.55 billion on the back of higher cost of sales, the company reduced operating expenses to boost the midline. Operating profit rose to N392.3 million in 2014 compared with N320.2 million in 2013.

    Profit before tax jumped by 144.9 per cent from N106.92 million to N261.81 million. Profit after taxes also rose by 48.8 per cent from N188.46 million to N280.43 million.  The positive earnings also strengthened the company’s balance sheet. Total assets improved from N10.72 billion in 2013 to N12.09 billion in 2014 while shareholders’ funds increased from N4.68 billion to N5.92 billion. The company declared N93.92 million as cash dividends, representing a dividend per share of 2.0 kobo.

     

  • Access Bank rallies as shareholders get N5.7b interim dividend

    Access Bank rallies as shareholders get N5.7b interim dividend

    Access Bank Plc was a major contrarian stock in the negative trading at the Nigerian stock market yesterday as the top-tier commercial bank released its half-year earnings report, showing impressive growths across key fundamentals.

    On the strength of the six-month earnings, which saw 43 per cent growth in gross earnings and 39 per cent in profit after tax, the board of the bank has recommended distribution of N5.72 billion as interim dividend to shareholders. The breakdown of the dividend recommendation indicated that shareholders on the register of the bank as at the close of business on September 3, 2015 would receive a dividend per share of 25 kobo. More than 830,000 shareholders would benefit from the interim dividend, which becomes payable on September 10, 2 105.

    Against the average decline of 0.98 per cent, Access Bank’s share price rose by 4.91 per cent, the fourth highest percentage gain, to close at N4.29 as the news made the round at the Nigerian Stock Exchange (NSE).

    Key extracts of the audited report for the six-month ended June 30, 2015 showed that gross earnings rose by 43 per cent to N168.3 billion in first half 2015 as against N117.9 billion recorded in comparable period of 2014. The top-line was boosted by an 18 per cent increase in interest income to N98.9 billion in the first half of 2015 compared with N83.6 billion in the comparable period of 2014. Group profit before tax leapt by 44 per cent to N39.1 billion as against N27.1 billion in previous year while profit after tax grew by 39 per cent to N31.3 billion in first half 2015 compared with N22.6 billion in first half 2014.

    Non-interest income had risen by 101 per cent to N69.4 billion in first half 2015 as against N34.6 billion in first half 2014. Return on average equity improved to 21.6 per cent in first half 2015 from 16.5 per cent in 2014.

    Group managing director, Access Bank Plc, Mr. Herbert Wigwe said the results reflect the bank’s concerted efforts to deliver on its growth objectives for 2015.

    According to him, while the first half of the year was defined by significant macro-economic and policy headwinds with major impact on all aspects of its business, the group despite those challenges reported improved profits in the first half of the year with significant contributions from its securities trading business.

    He commended the strong support from shareholders of the bank noting that the success of the recently concluded rights issue which raised N41.8 billion has placed the bank in a stronger position.

    “With our capital position secure, our priority will be to focus on; driving migration of our customers to alternative platforms  to boost profitability of our channels; implementing  our customer service improvement initiatives; generating low-cost liability from continued engagement with customers; growing risk assets by deepening market share in target sectors; optimising and improving penetration of our customers’ value chain and driving operational efficiency through  cost containment and procurement optimization measures,” Wigwe said.

  • UPDC outlines new growth plan as shareholders get N859m dividend

    UACN Property Development Company (UPDC) Plc plans to source additional capital through a supplementary equity issue and disposal of certain surplus assets as part of a medium-term plan to deleverage the real estate company and boost its liquidity.

    Chairman, UACN Property Development Company (UPDC) Plc, Mr. Larry Ettah, outlined the strategic plan of the company at the annual general meeting held at Golden Tulip, Festac, Lagos. Shareholders approved distribution of N N859.4 million as cash dividends for the 2014 business year, representing a dividend per share of 50 kobo.

    Ettah said the company is focused on long-term value creation and has put in place strategies to enable it take advantage of emerging opportunities in the market place.

    He outlined that the company would be raising new equity funds through a supplementary capital issue while it would also dispose its surplus equity stake in the UPDC Real Estate Investment Trust (UPDC Reit) to reduce its debt overhang and free more earnings for shareholders.

    “Our strategy for 2015 and beyond include deleveraging the business through equity capital injection, disposal of the surplus stake currently held in UPDC REIT, about 21.5 per cent, to generate liquidity and re-creating our products portfolio to include more commercial and retail offerings which have proven to be more resilient revenue sources in periods of depression,” Ettah said.

    He noted that the Nigerian real estate market remained attractive as there were significant untapped potentials in the residential segment, and numerous opportunities in the hospitality, retail, commercial and industrial segments of the market in the near term.

    According to him, in recent years, foreign private equity firms have invested millions of dollars in the Nigerian real estate market due to existing and emerging huge demand which is driven by increasing urban population and changing shopping culture among the expanding middle class.

    “The real estate market is gradually rebounding and has experienced reasonable growth and performance in the last few years. This performance is largely driven by the re-emergence of the Nigerian middle-class and the increasing demand for decent residential and commercial accommodation by high net-worth individuals, corporate organizations and key players in the retail segment of the economy,” Ettah pointed out.

    He added that the upturn in economic activity which started in the last quarter of 2011 has led to an increase in demand and supply for commercial and high end residential developments, particularly in the key cities of Abuja, Lagos and Port Harcourt.

    He said UPDC has continued its ongoing developments in 2014 and commenced some new ones, assuring that the company is on a good footing to sustain good performance.

    Ettah however highlighted that challenges being faced by the industry in terms of title uncertainties, high cost of funding, inadequate mortgage financing and poor infrastructure are expected to persist in the medium term and might continue to prevent effective demand in the low to medium residential market segments.

    Audited report and accounts for the year ended December 31, 2014 showed group turnover of N11.70 billion in 2014 as against N11.29 billion in 2013. Profit before taxation stood N3.54 billion compared with N3.71 billion in 2013.

  • Shareholders get N3.22b dividend as PZ Cussons records N6.6b profit

    Shareholders of PZ Cussons Nigeria Plc would receive a total of N3.22 billion as cash dividends for the immediate past business year as the conglomerate showed early gains of its restructuring exercise.

    The board of directors of PZ Cussons Nigeria has recommended distribution of N2.42 billion as final cash dividend, bringing total cash payout for the year to N3.22 billion. The company had earlier this year distributed N794 million as interim cash dividend.

    Shareholders on the register of the conglomerate as at close of business on September 14, 2015 will receive a final dividend per share of 61 kobo in addition to earlier interim dividend per share of 20 kobo, representing a total dividend per share of 81 kobo. The final dividend will become payable on September 30, 2015.

    Key extracts of the audited report and accounts of PZ Cussons Nigeria for the year ended May 31, 2015 showed that total sales rose marginally from N72.90 billion in 2014 to N73.12 billion in 2015. The company’s top-line cost of sales dropped by 1.9 per cent to N52.67 billion in 2015 as against N53.71 billion in 204. However, operating expenses increased by 7.1 per cent from N12.89 billion to N13.8 billion.

    The company also came under pressure from financing costs, which rose by 215.4 per cent from N141.05 million to N444.86 million. Consequently, profit before tax slipped by 5.66 percent from N6.95 billion to N6.56 billion. Profit after tax also declined by 10.7 per cent to N4.6 billion compared with N5.1 billion in the previous year. Earnings per share dropped by 11.72 per cent to N1.03 as against N1.16 in 2014. The conglomerate’s net assets meanwhile inched up 2.67 per cent from N42.54 billion in 2014 to N43.67 billion.

    PZ Cussons Nigeria had started on major corporate restructuring aimed at streamlining its operations and curtailing costs. It earlier this year filed for regulatory approval to combine two of its wholly owned subsidiaries – PZ Power and PZ Tower with the parent company. The business combination would be effected through a scheme of arrangement.

    In a regulatory filing, the group stated that the corporate restructuring would simplify its structure and operations, thereby leading to reduction in administrative costs while simultaneously improving operational efficiency.

    PZ Cussons, the United Kingdom-based parent company that holds 69.77 per cent in the Nigerian company, has focused attention on its Nigerian subsidiary with a view to strengthening the company as the hub of its West African operations.

    PZ Cussons Nigeria has invested not less than $130 million in strengthening and expanding its business operations in Nigeria.

    During a recent visit and tour of part of Nigerian operations by members of board of directors of the PZ Cussons, Chairman, PZ Cussons, United Kingdom, Richard Harvey, said the conglomerate sees more exciting opportunities in Nigeria and it is committed to long-term development of its Nigerian business.

    According to him, PZ Cussons has continued to invest in the capacity of its Nigerian business in demonstration of its commitment to sustain its Nigerian business as a major plank of the global operations of PZ Cussons.

    He said PZ Cussons’s bouquet of products from household items to electronic appliances is in growing demand and the group looks toward its Nigerian business as a major contributor to global performance.

    “We are more excited about the opportunities now than we have been for a very long time,” Harvey said.

    He pointed out that Nigeria contributes about 55 per cent of the group’s global turnover while the refrigerator business contributed about 30 per cent to PZ Cussons Nigeria’s turnover, which approximately gave the Nigerian refrigerator business some 17 per cent of global sales.

    Harvey in company of other directors toured the newly remodeled refrigerator manufacturing plant in Ilupeju, Lagos.

    According to him, the additional refrigerator production line, which was formally commissioned during the visit, was meant to rapidly expand the distribution of cooling products In Nigeria and Ghana and to keep the company in good stead to meet anticipated continuous increase in demand.

    Harvey said the conglomerate will continue to prospect for opportunities to increase its business in Nigeria citing the recent multi-billion investment in palm oil processing plant and refinery.

    According to him, the biggest new business line-‘Mamador’, being produced from the brand new refinery at Ikorodu, Lagos, has gotten off to instant success with the company selling every bit of its production.

    “We get a series of developments we want to do but as you will expect I am not able to share those secrets with you now,” Harvey said.

    He however ruled out possible capital issue in the nearest future noting that PZ Cussons has sufficient capital base to internally fund its growth initiatives.

    He assured Nigerian shareholders that the conglomerate has been positioned for improved performance and returns while affirming the commitment of the foreign core investor to mutually beneficial relationship with its Nigerian shareholders.

    “They are investing in the right company,” Harvey quipped when asked about his message to Nigerian shareholders.

  • Shareholders earn 23% return as UBA lists 3.3b rights shares

    Amidst the dwindling over all market position at the Nigerians stock market, shareholders of United Bank for Africa (UBA) Plc, who subscribed for the bank’s rights issue in February, have earned more than 23 per cent capital gain.

    UBA had between December 2014 and February 2015 sought to raise N11.5 billion new equity funds from existing shareholders through a rights issue of one ordinary share for every 10 ordinary shares at a price of N3.50 per share. The rights issue was fully subscribed.

    The bank at the weekend listed about 3.3 billion ordinary shares of 50 Kobo each that arose from the rights issue. While the supplementary shares were listed at the offer price of N3.50 per share, UBA opened yesterday at N4.31 per share, providing immediate return of 23.1 per cent or about N2.67 billion capital gains to the rights’ holders.

    The listing was closing step in the final phase of the issuance process, which included dispatch of share certificates and electronic transfer of shares to shareholders’ shareholding account at the Central Securities Clearing System (CSCS). With the shares in the CSCS, the rights’ holders can trade on their shares.

    Average year-to-date return at the Nigerian stock market opened this week at -10.29 per cent, underlining the general negative sentiments that had dominated the market so far this year. This month has so far been a grueling one for investors with substantial average loss across the sectors. Month-to-date analysis showed all indices in the red, which also coloured the average year-to-date performance. So far this month, average return by the All Share Index (ASI), the general benchmark index at the NSE, opened Monday at -7.07 per cent. Returns by other indices were NSE 30 Index, -7.46 per cent; NSE Consumer Goods Index, -9.89 per cent; NSE Oil and Gas Index, -5.33 per cent; NSE Industrial Goods Index, -4.14 per cent; NSE Banking Index, -7.83 per cent while the NSE Insurance Index carried a month-to-date return of 2.91 per cent.

    All the indices, with the exception of the NSE Industrial Goods Index, also showed that nearly all investors have so far this year lost rather than gain in the market. Year-to-date analysis by the start of the market on Monday indicated that average return by the ASI at -10.29 per cent; NSE 30 Index, -9.66 per cent; NSE Consumer Goods Index, -15.96 per cent; NSE Oil and Gas Index, -8.22 per cent; NSE Banking Index, -3.39 per cent; NSE Insurance Index, -6.78 per cent while the NSE Industrial Goods Index played the contrarian with gain of 1.78 per cent.

    Investment advisors at Exotix Partners LLP, a global finance and investment firm with offices in major global financial centres and significant imprints in Africa, said that UBA’s share price could rise to N9.95 per share over the next 12 months. Exotix coordinates its global operations through five major offices in London, New York, Lagos, Dubai and Nairobi.

    The Exotix report, signed off by Kato Mukuru and Ronak Ghadia, chartered financial analysts, had upgraded UBA’s ranking to buy, a favourable recommendation to investors.

    Analysts commended what they described as gradual improvement in the fundamentals of the bank noting that the bank’s management has substantially improved the group’s profit drivers, which has not been fully recognised.

    They noted increasing improvement in cost efficiency as the cost to income ratio improved from 89.2 per cent in 2011 to 67.4 per cent in2014, with a projection for further improvement to 57.3 per cent by 2019 on the back of continued moderate operating expenses growth.

    Analysts also pointed out that the bank has witnessed notable improvement in asset quality over the four-year period. Since 2011, UBA has averaged a cost of risk of 0.9 per cent as against peer average of 1.3 per cent while its non-performing loan ratio of 1.6 per cent was the lowest among Nigerian banks in 2014.

    “Relative to its peers, the bank’s loan portfolio has remained very diversified. In particular, as at 2014, exposure to the vulnerable oil and gas sector was 19 per cent as against sector average of 25.7 per cent and its foreign currency denominated loans were 31.1 per cent of total loans as against peer average of +40 per cent. Despite the tough operating environment, management remain confident of maintaining a cost of risk of 1.0 per cent and non-performing loan (NPL) ratio of 2.0 per cent. We remain conservative and assume a cost of risk of 1.5 per cent and NPL ratio of 3.5 per cent,” Exotix stated.

    Analysts also cited UBA’s growing non-funded income contribution with total non-interest income increasing by cumulative annual growth rate of 19.3 per cent over the past three years. This was partly driven by exceptional foreign exchange trading gains in 2014 as well as a 7.5 per cent cumulative increase in core fees and commission income.

    “We think the headline growth in fees and commissions is impressive given the regulatory pressures on this line item. UBA’s average non-interest income to total operating revenue of 41.5 per cent remains significantly above peer average of 34.3 per cent. We forecast non-interest income growth to moderate to 4.0 per cent over the next five years due to non-recurrence of the exceptional trading gain in 2014 and zero rating of commission on turnover (COT). Nonetheless, we forecast core fee and commission income growth to remain strong at 8.3 per cent due to some of the initiatives taken by the group,” analysts at Exotix noted.

    The report indicated that the bank could gradually overcome the major drag of its low margins as from this year. Analysts regarded low margins, which have averaged 4.4 per cent as against peer average of 6.3 per cent, as the biggest drag on UBA’s profitability. However, the group’s asset yields have improved from 6.9 per cent to 7.7 per cent and the continued low margins were therefore due to an increase in funding costs, which rose to 3.8 per cent as significant tightening of monetary policy weighed in on the industry. With the proportion of foreign exchange-based loans to total loans declining to 31 per cent in 2014 from 34.4 per cent in 2013, analysts believed that UBA could benefit from 20-basis points margin uplift in 2015 and gradually to 5.0 per cent by 2019 as regulatory pressures and funding costs decline.

    The board of UBA said the additional equity from the rights issue would support the bank’s capital base ahead of the full implementation of BASEL II, which requires higher capital buffer for banks, to accommodate credit, operational and market risks inherent in the business of financial intermediation.

    Group managing director, United Bank for Africa (UBA) Plc, Mr. Phillips Oduoza, said the new equity fund provides further leverage to exploit growth potential in its markets.

    “On behalf of the management of UBA, I appreciate the shareholders for their strong commitment towards the growth of our dear bank and for the unwavering confidence reposed in us in building a great Pan-African institution,” Oduoza said.

  • Shareholders blame regulators for imposing fines on firms

    Shareholders blame regulators for imposing fines on firms

    Shareholders in the insurance industry have expressed displeasure over the huge sum deposited at the Central Bank of Nigeria (CBN) as statutory deposit by firms.

    The shareholders are also not happy with the National Insurance Commission (NAICOM) over fines imposed on operating firms in the industry for various offences especially failure to meet deadline for submission of  annual accounts and financial reports.

    The shareholders made this known at the 23rd Annual General Meeting (AGM) of Cornerstone Insurance Plc in Lagos.

    The Cornerstone shareholders said it was painful to them to see record of N128million fine paid by the company to NAICOM and other related regulators because of various offences recorded against them.

    One of the shareholders, Akinsonya Solomon,  said the incessant fines heaped on operating firms by the regulators are becoming unbearable observing that virtually all insurance firms in Nigeria have been fined for one offence or the other this year.

    Mr Robert Igwe another shareholder of the company wants the NIA as the umbrella body of insurance underwriters to take up the issue of statutory deposit of the industry lying idle with little or no interest with the CBN to the law makers.

    He posited that the huge amount could yield good interest to the various firms if used in business adding that on the alternative, the CBN should pay interest commensurate to the quantum of money deposited by the various companies.

     

  • Shareholders approve controversial Samsung C&T merger

    The merger would consolidate the founding family’s control over the Samsung group. One of South Korea’s most controversial mergers has been given approval by shareholders of the construction company Samsung C&T.

    The deal will see the firm taken over by holding company Cheil Industries, another part of the Samsung group. The merger is strongly opposed by some of Samsung C&T’s shareholders, led by US hedge fund Elliott Associates.

    For Samsung’s founding family, the move is a crucial step in consolidating control of the conglomerate.

    Shareholders in Cheil Industries approved the merger earlier on Friday. Shares in Samsung C&T fell 10.4 per cent and Cheil Industries dropped 7.7 per cent after the merger was approved.

    Elliott Associates, which is the second largest single shareholder in C&T, says the takeover significantly undervalues the company’s stock.

    The hedge fund had filed several unsuccessful law suits to stop the vote from going ahead.

    The takeover is key to consolidating the Samsung founding family’s control of the multi-headed conglomerate.

    It is of particular significance as it comes ahead of a generational power transfer at Samsung.

    The business empire’s patriarch Lee Kun-hee has been in hospital since May 2014 and his son Lee Jae-yong is to take a bigger leadership role.

  • Delay in govt appointments affecting the market, say shareholders

    The continuing delay in the announcement of cabinet positions of the new government of President Muhammadu Buhari is adversely affecting the performance of the capital market, a group of shareholders has said.

    Shareholders under the aegis of Proactive Shareholders Association of Nigeria (PROSAN) said the continuous delay on the appointment of ministers would continue to affect the capital market as investors need to know the policy direction of the economy.

    National coordinator, Proactive Shareholders Association of Nigeria (PROSAN), Mr. Oderinde Taiwo, said both foreign and local investors will only invest in a market if they know the policy direction.

    “You can see that immediately the new President of Nigeria emerged after the 2015 election, the stock market moved up and now the market has been going down because of the uncertainty caused by continued delay in the appointment of ministers and policies pronouncement,” Taiwo said.

    He urged shareholders to show active interest in the affairs of their companies, berating the low attendance of shareholders at annual general meetings.

    He canvassed for a rule by the Securities and Exchange Commission (SEC), which will make it mandatory for companies to provide online audio and video of the general meeting’s proceedings.

    According to him, one of the demands of sustainable good corporate governance is the disclosure of vital information to their shareholders which are always discussed among other matters on the floors of the annual general meeting. As such, if there is any way such proceedings can be assessed by shareholders after such meeting, it will be a move towards positive direction.

    Taiwo urged SEC to continue to think on ways of further developing the Nigerian market to meet global standards.

     

  • Seven-Up to pay N1.76b dividend to shareholders

    Seven-Up to pay N1.76b dividend to shareholders

    The board of directors of Seven-Up Bottling Company Plc has recommended distribution of N1.76 billion as cash dividends to shareholders of the soft drink company.

    A breakdown of the dividend recommendation shows that shareholders would receive a dividend per share of N2.75. The dividend recommendation highlighted the improvement in the performance of he company in the immediate past year.

    Key extracts of the audited report and accounts of Seven-Up for the year ended March 31, 2015 showed that turnover rose from N77.89 billion in 2014 to N82.45 billion in 2014. Gross profit also increased from N28.47 billion to N30.48 billion. Profit before tax rose from N7.62 billion to N8.75 billion while profit after tax improved to N7.13 billion in 2015 as against N6.43 billion in 2014.

    Shareholders of the company are expected to meet in September to consider the annual report and the dividend recommendation.

    Seven-Up has witnessed steady growth in recent years, with the resultant positive sentiments driving its share price above N100. The stock was subsequently admitted into the exclusive list of stocks with N100 share price and above. The share prices of these exclusive stocks are allowed to move with 10,000 volume as against general rule of 50,000 shares.

    Audited report and accounts of the soft-drink company for the year ended March 31, 2013 showed that sales increased by 7.1 per cent but higher margins pushed profit before tax up by 27.5 per cent. Profit after tax rose by 70.3 per cent, underlining the increase in basic earnings per share from N2.62 in 2012 to N4.46 in 2013.The improved bottom-line performance enabled the company to increase cash payout by 10 per cent just as its net assets value rose by 22 per cent.

    The audited report showed that group turnover rose by 7.1 per cent from N59.86 billion to N64.09 billion. Cost of sales moderated at N41.12 billion as against N38.54 billion. Gross profit rose by 7.3 per cent from N21.333 billion to N22.89 billion. Total operating expenses stood at N17.41 billion, 5.0 per cent above N16.58 billion recorded in the previous year. While non-core business income rose by about 25 per cent from N57 million to N72 million, interest expense was almost flat at N2.29 billion in 2013 as against N2.25 billion in 2012. With these, profit before tax increased by 27.5 per cent from N2.56 billion to N3.26 billion. With about 54 per cent reduction in tax expenses, profit after tax jumped by 70 per cent from N1.68 billion to N2.86 billion.

    A leading fast moving consumer good (FMCG) company, 7-Up is the manufacturer and Nigerian franchise holder for several global soft drinks including its flagship-7-Up brand, Pepsi and Mirinda. Its other popular brands include Teem Lemon, Mountain Dew and aquafina. Incorporated in 1959, its shares were listed on the Nigerian Stock Exchange (NSE) in 1959. It stands alone as the only publicly quoted soft-drink company in Nigeria. Affelka S A is the majority core investor in 7-Up with total equity stake of 72.97 per cent.

     

  • Nigerian shareholders want judiciary to support market reforms

    Nigerian shareholders want judiciary to support market reforms

    As the Securities and Exchange Commission (SEC) steps up enforcement actions on erring operators, shareholders have urged the judiciary to play constructive and supportive roles to ensure the success of capital market reforms.

    Shareholders said the judiciary should be accord special interests to cases of investors’ protection, market integrity and professional ethics as these are key elements that make up investors’ confidence; the driving force for capital market growth.

    According to them, judges should adjudicate on capital market-related cases promptly and should also not grant unnecessary orders in favour of operators to shield them from punishment after committing infractions in the market.

    National chairman, Proactive Shareholders Association of Nigeria, Mr. Oderinde Taiwo, said the judiciary should give speedy hearing to capital market related cases.

    “The regular courts should also cooperate with special courts such as the Investment and Securities Tribunal (IST) in resolving capital market cases. A situation whereby IST, which is equivalent to a high court, gives an order and another high court gives a counter order is not good for the market,” Taiwo said.

    President, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, said judges should base their judgements on merits of each case instead of indiscriminately issuing orders.

    According to him, apart from fast-tracking the judgement delivery process, judges should listen to arguments of both parties and deliver their judgements based on merits.

    “When any offender is brought before any court, the court should be able to look at the case dispassionately and ask the defendant to go and face the music rather than delay the case unnecessarily or issue orders preventing the defendant from prosecution,” Okezie said.

    Mr. Moses Igbrude of Independent Shareholders Association of Nigeria (ISAN), said investors had been frustrated and discouraged due to the delay in getting justice.

    “We are now calling on the judiciary that in order to restore investor confidence and as part of their continued contribution to the growth of the market, capital market-related cases should be dispensed with speed,” Igbrude said.

    According to him, in the new dispensation, the judiciary should discourage the issuance of orders to capital market operators, who, after violating rules, will run to the courts for cover.

    “This has been happening and I believe given the high expectations for change in the entire country, the courts should no longer grant orders to those who have deliberately committed offences and when they are asked to face the music, they run to the court for protection that they do not deserve,” Igbrude, who is also the chairman of Consumer Rights Awareness Advancement & Advocacy Initiative (CRAAAI), said.

    The shareholders spoke against the background of recent enforcement actions by SEC. The Investment and Securities Act (ISA), which enshrines investor’s protection as the core mandate of SEC, gives it wide-ranging powers to protect investors from any form of abuse.

    SEC is statutorily empowered to “ intervene in the management and control of capital market operators which it considers has failed, is failing or in crisis including entering into the premises and doing whatsoever the Commission deems necessary for the protection of investors” while it can also “in furtherance of its role of protecting the integrity of the securities market, seek judicial order to freeze the assets (including bank accounts) of any person whose assets were derived from the violation of this Act, or any securities law or regulation in Nigeria or other jurisdictions”.

    In furtherance of the provisions of the ISA, SEC recently came down heavily on one of Nigeria’s leading investment banking groups with the suspension of the BGL Group and its subsidiaries from all capital market activities.

    SEC said its decisions were based on the “report of a detailed investigation into the various complaints received from investors against subsidiaries of BGL Group”.

    SEC had late April intervened in the operations of BGL Group Plc, suspended its board and set up an interim management board for the group. The interim management board, headed by a former president of Chartered Institute of Stockbrokers (CIS), Mr Oladipo Aina, was mandated to conduct full investigation into the operations of BGL Group. Other members of the interim board were Mr. Abubakar Ambursa, Mrs. Hafsat Rufai, Ms. Temitayo Siyanbola and Ms. Tonne Ladipo-Ajayi.

    On the basis of the investigation report, SEC yesterday announced the suspension of BGL Asset Management Limited, BGL Capital Limited and BGL Securities Limited from all capital market activities.

    The Commission also directed that all major officials and sponsored individuals of BGL Asset Management Limited, BGL Capital Limited and BGL Securities Limited whose particulars are contained in the Commission’s record as at December 2014 be suspended from performing any capital market activity.

    SEC particularly cited Mr. Albert Okumagba, the group managing director of BGL Group and directed that Okumagba, who was the president of CIS before the April sack of the board, should cease to be a registered sponsored individual with the Commission following the withdrawal of the registration of BGL Plc as a capital market operator.  With this directive, Okumagba, one of the most influential capital market operators, will therefore no longer be entitled to carry out capital market activities.

    Besides, the apex capital market regulator stated that it has referred what it described as “suspicious transactions” observed in the course of the investigation to the appropriate law enforcement agencies for further investigation.

    According to the statement, BGL Asset Management Limited, BGL Capital Limited and BGL Securities Limited and all individuals involved in the management of the companies have also been referred to the Administrative Proceedings Committee (APC) of SEC for further trial.

    In an affidavit deposed to by SEC, the Commission said BGL was having liquidity problems and has been running at a loss to the tune of over N48 billion as at December 31, 2014.

    SEC stated that BGL is indebted to investors who complained to the tune of N5.769 billion and that the indebtedness has precluded the company from performing its obligations to its clients and investors.