Economy
Africa Prudential Considers New Ventures to Improve Earnings
By Modupe Gbadeyanka
Managing Director/CEO of Africa Prudential, Mr Obong Idiong, has attributed the poor performance of the company to some challenges, including the operating environment.
However, he said efforts are being made by the management to ensure things improve in the second quarter of the year. He said part of the strategies mapped out is planned foray into new ventures with high growth prospect, which he said should boost the company’s earnings.
In the unaudited financial statements of Africa Prudential for the period ended March 31, 2019, released yesterday, the company closed with a gross earnings of N869.4 million against N957.8 million a year ago, representing a decline of 9 percent.
Business Post, which analysed the results, found out that the Registrar’s interest income depleted by 19 percent to 595.5 million from N734.3 million as a result of the reduction in debt instrument coupled
with a decline in yield environment during the quarter under review, which saw a 51 percent drop in interest on T-Bills and 64 percent decline in interest on bonds.
For the company’s finance cost in Q1 2019, it significantly went down by 46 percent to N101 million from N186.3 million due to the full settlement of the outstanding bank loans which led to a reduction in interest paid within the quarter compared to the same period last year.
In the period under review, operating expenses increased by 25 percent owing to the growth experienced in personnel expenses and other operating expenses, both line items appreciated as a result of the formal establishment of some of the strategic business units (SBUs) to be launched later in the year with a view to ensuring efficiency in operation while obtaining superior returns from its operations.
It was revealed in the results that profit before tax dropped 16 percent to close at N453.7 million from N541.7 million, while the profit after tax fell to N381.5 million from N460.9 million, with the earnings per share staying at 19 kobo in contrast to 23 kobo of the same time of last year.
In his reaction to the company’s performance, Mr Idiong said, “While we were faced with some challenges which impeded our performance this past quarter, one of which was the declining yield environment thus mildly impacting one of our income line item- Interest Income.
“On the other hand, we saw a 23% increase in our revenue from contracts with customers which was as a result of the several corporate actions undertaken by many of our clients in view of their full year Annual General Meetings, dividend declaration etc. The management is however committed to improving upon our performance in the coming quarter following the launch of our strategic business units (SBUs), namely; Digital Technology, EasyCoop Mart and Cooperative business.
“To complement the traditional Registrar business, the benefits of the new business segments are expected to be felt from Q2 2019 going forward.”
He said further that, “The various strategic steps we have been taking is towards establishing us as the registrar of choice, while making foray into new ventures with high growth prospect, to do this we would be leveraging on technology, research & development as well as capacity building to ensure we achieve the aforesaid goals.
“We would continue to bring to bear, our doggedness whilst taking pragmatic steps towards tackling the arrays of issues plaguing us and our industry for a long time now.
“Going into the second quarter of 2019, we would not be resting on our oars as we would ensure we keep to our promise of delivering unique customer experience to our wide clientele base.”
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange closed flat on Wednesday, August 5, as the market witnessed weaker trading activity with only two deals executed.
In the midweek session, the volume of securities exchanged by investors dropped 99.9 per cent to 802 units from the 1.6 million units recorded on Tuesday. The value of securities further decreased by 99.6 per cent to N208,240 from the preceding session’s N47.6 million, and the number of deals significantly went down by 93.9 per cent to two deals from the 33 deals recorded a day earlier.
Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and Central Securities Clearing System (CSCS) Plc with 76.9 million units transacted for N5.5 billion.
GNI Plc was also the most active stock by volume on a year-to-date basis, with 3.4 billion units exchanged for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
There were no price gainers or losers yesterday.
As a result, the market capitalisation stood unmoving at N2.739 trillion, while the NASD Security Index (NSI) remained unchanged at 4,563.96 points.
By Adedapo Adesanya
The Naira slid against the US Dollar by N2.28 or 0.17 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Wednesday, August 5, to N1,363.85/$1 from N1,362.55/$1.
The local currency also declined against the Pound Sterling in the official market during the session by N5.97 to close at N1,837.38/£1 compared with Tuesday’s closing rate of N1,831.41/£1, and against the Euro, it crashed by N6.54 to quote at N1,575.25/€1 versus the preceding session’s N1,568.71/€1.
But at the black market, the Nigerian Naira traded flat against the greenback yesterday at N1,400/$1, and also remained unchanged at the GTBank FX desk at N1,373/$1.
The Central Bank of Nigeria (CBN) says rates have narrowed to below two per cent, while the country’s external reserves have risen above $52.5 billion, reflecting the impact of its ongoing monetary and foreign exchange reforms.
CBN Governor Yemi Cardoso, represented by the Acting Director of Corporate Communications and Investor Relations, Mrs Hakama Sidi-Ali, disclosed this on Tuesday during the CBN Fair in Gombe. He noted that reforms introduced since 2023 had significantly reduced the disparity between the official FX market and the parallel market.
“The Naira continues to strengthen, with the spread between official and Bureau de Change rates now below two per cent,” he said, adding that reserves at $52.5 billion were supported by sustained inflows and renewed investor confidence in the economy.
Interbank FX transactions slid as weaker market activities dropped total Dollar volume exchanged to $75.35 million, a 51.8 per cent decline from $156.23 million in turnover quoted at the previous close.
The deals at the NFEM window also fell as data from the central bank put Wednesday’s quote at 82 from 139.
In the cryptocurrency market, major were down as global risk sentiment softened as a key world equity index slipped and chipmakers fell.
The MSCI All Country World Index snapped a five-day run to fall 0.2 per cent as chipmakers retreated on both sides of the Pacific. South Korea’s Kospi, a bellwether for the AI trade, dropped 4.4 per cent.
Ripple (XRP) depleted by 1.7 per cent to $1.05, Binance Coin (BNB) decreased by 1.0 per cent to $594.87, Cardano (ADA) depreciated by 0.9 per cent to $0.1884, TRON (TRX) shrank by 0.2 per cent to $0.3261, Solana (SOL) crumbled by 0.1 per cent to $74.00, and Dogecoin (DOGE) went down by 0.1 per cent to $0.0697.
On the flip side, Ethereum (ETH) gained 2.3 per cent to trade at $1,911.41, and Bitcoin (BTC) rose by 0.8 per cent to $64,759.28, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Dipo Olowookere
The domestic stock exchange rebounded by 0.05 per cent on Wednesday on the back of renewed bargain-hunting by investors, though the level of activity waned.
After bleeding for a few days, the Nigerian Exchange (NGX) Limited heaved a sigh of relief yesterday, as the All-Share Index (ASI) gained 109.41 points to close at 244,912.24 points compared with the previous day’s 244,802.83 points, and the market capitalisation garnered N71 billion to settle at N158.087 trillion versus Tuesday’s N158.016 trillion.
Business Post reports that despite the rebound recorded by Customs Street at midweek, the market breadth index remained negative, as there were 20 price advancers and 29 price decliners, implying bearish investor sentiment.
Linkage Assurance appreciated by 9.94 per cent to N1.77, AVA Capital rose by 9.55 per cent to N10.90, Fortis Global Insurance advanced by 7.69 per cent to N2.80, McNichols gained 7.34 per cent to finish at N5.85, and Coronation Insurance surged by 5.51 per cent to N2.49.
Conversely, Honeywell Flour depreciated by 9.94 per cent to N16.30, PZ Cussons gave up 9.94 per cent to trade at N74.75, Zichis crashed by 9.74 per cent to N20.76, Learn Africa slipped by 9.62 per cent to N9.40, and Neimeth tumbled by 8.33 per cent to N8.25.
The busiest equity was FCMB, with a turnover of 369.2 million units valued at N4.1 billion. Chams transacted 46.7 million units worth N201.8 million, First Holdco transacted 43.5 million units for N5.7 billion, Access Holdings sold 29.8 million units worth N778.0 million, and Linkage Assurance exchanged 19.6 million units valued at N33.5 million.
At the close of transactions, market participants bought and sold 824.1 million units worth N25.5 billion in 48,114 deals, in contrast to the 1.6 billion units sold for N28.7 billion in 54,160 deals a day earlier, showing a shortfall in the trading volume, value, and number of deals by 48.49 per cent, 11.15 per cent, and 11.16 per cent, respectively.
