Africa Prudential Suffers Drop in Q1 2020 Earnings, Profit

By Dipo Olowookere

The financial statements of Africa Prudential Plc for the first quarter of 2020 have been filed to the Nigerian Stock Exchange (NSE).

In the results for the period ended March 31, 2020, Africa Prudential suffered a decline in its gross earnings, which fell to N43.4 million from N868.4 million recorded in the corresponding period of 2019.

The decline in the gross earnings was majorly due to low revenue generated from contracts with customers, which stood at N131.6 million as against N273.9 million over the same period of last year.

However, there was an improvement in the interest income, N611.8 million in Q1 2020 versus N595.5 million in Q1 2019.

Business Post observed that the rise in the interest income was buoyed by higher interest received on loans and advances (N541.9 million in Q1 2020 versus N441.4 million in Q1 2019). A further analysis of the interest income showed that there was a decline in interest on treasury bills (N69.6 million as against N150.7 million in the corresponding period of last year) and lower interest on short-term deposits, which dropped to about N362,000 from N1.2 million.

In the results, Africa Prudential said it recorded an an improvement in the other income, which marginally rose to N2.9 million from N2.8 million, while personnel expenses increased during the period to N158.1 million from N155.2 million due to increase in wages and salaries, medical expenses and defined contribution plans.

Also, the other operating expenses jumped to N152.2 million from N145.2 million as a result of increases in professional fees, internet and communication, travel expenses, directors fees and other emoluments, training, repairs and maintenance and insurance.

Depreciation of property and equipment stood at N14.0 million as against N12.0 million in the first quarter of last year, while amortisation of intangible assets stood at N5.3 million versus N5.1 million in Q1 2019.

In the first three months of this year, Africa Prudential said its profit before tax went down year-on-year to N413.5 million from N55.8 million, while the profit after tax fell to N341.8 million from N381.5 million, with the earnings per share at 17 kobo as against 19 kobo in the first three months of 2019.