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Economy

Airtel Africa Declares Half-Year Dividend as Data, Mobile Money Boost Revenue

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NSE lists Airtel Africa Shares

By Dipo Olowookere

Shareholders of Airtel Africa will receive an interim dividend of $1.5¢ (one and a half cents of the US dollar) per share for the half-year ended September 30, 2020, the board of the telco has declared.

This, according to the board, is in line with the new progressive dividend policy to focus on growth opportunities and faster deleveraging.

The new policy aims to grow the dividend annually by a mid to high-single-digit percentage from a base of $4 cents per share for the full year, the company noted in the statement on Friday.

The key highlights of the financial statements of the company released to the Nigerian Stock Exchange (NSE) showed that while the customer base grew by 12.0 per cent to 116.4 million, the revenue on a reported basis increased by 10.7 per cent to $1.8 billion, with Q2 revenue growth of 14.3 per cent.

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In addition, the revenue growth in constant currency was 16.4 per cent in H1 and 19.6 per cent in the second quarter of the year.

It was observed that growth was recorded across all regions, with Nigeria up by 20.2 per cent, East Africa up by 21.9 per cent and Francophone Africa up by 4.4 per cent.

Furthermore, the voice revenue increased by 7.0 per cent, data rose by 33.4 per cent and mobile money jumped by 30.4 per cent.

In the results, the underlying EBITDA increased 12.8 per cent to $812 million while constant currency underlying EBITDA growth was 19.3 per cent, with reported underlying EBITDA margin at 44.7 per cent.

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In the period under consideration, the operating profit increased by 19.5 per cent to $472 million, an increase of 28.3 per cent in constant currency, while the free cash flow stood at $319 million versus $210 million in the same period last year.

As a result of exceptional items and a one-off derivative gain incurred in the prior year, the earnings per share (EPS) dropped 52.9 per cent to $3.0¢.

In the words of the chief executive of the company, Mr Raghunath Mandava, “The fundamentals of our business remain strong and revenue growth further benefitted from the execution of our strategy with a specific focus on expanding distribution in the rural areas, investing in our network and increasing 4G coverage, as well as benefitting from the fact we provide an essential service to consumers.”

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According to him, in the second quarter of the fiscal year, Airtel Africa partnered with “leading institutions such as WorldRemit, MoneyGram, Standard Chartered Bank and Mukuru to increase use cases and improve customers’ access to digital payments and financial services.”

“We remain alert to the potential for further disruptions from a second wave of COVID-19 across Africa and the associated actions of governments to minimise contagion.

“Nevertheless, we are in a strong financial position to capture the opportunities in a fast-growing region that is vastly underpenetrated in terms of mobile and banking services. We remain confident of delivering long-term sustained growth for our shareholders,” he assured.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

NGX Upgrades BOC Gases Shares to Medium-Priced Stock Group

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BOC Gases

By Dipo Olowookere

Shares of BOC Gases have been upgraded and placed on the medium-priced stock level from the previous low-priced stock category.

The reclassification became necessary after its equity value has traded at the current group for a period of four of its most recent six months.

The Nigerian Exchange (NGX) Limited puts stocks on its trading platform into three groups; high-priced, medium-priced, and low-priced levels and this is purely based on their market price.

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In this regard, securities must have traded for at least four out of the most recent six-month period within a stock price level’s specified price band to be classified into the category.

In a notice on Wednesday, the exchange said a review of BOC Gases’ stock price and trade activities over the most recent six-month period provides the basis for reclassifying the security from the low-priced stock group to the medium-priced stock group.

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“This reclassification also necessitates the attendant change in the tick size change from one kobo to 5 kobo, in line with Rule 15.29: Pricing Methodology, Rulebook of the Exchange, 2015,” the notice sighted by Business Post explained.

It was further explained that BOC Gases stock price appreciated above the N5 price level on November 16, 2020, and traded above N5 up till the close of business on March 17, 2021.

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“This indicates that BOC Gases Plc stock price has traded above N5 in at least 4 months out of the last 6 months.

“Resultantly, BOC Gases Plc has been reclassified from the low-priced stock group to the medium-priced stock group with effect from today, [Wednesday], June 16, 2021,” the disclosure added.

Shares of BOC Gases closed flat today at the stock exchange at N10.55 per unit.

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Economy

SEC Okays NG Clearing as Central Counterparty

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NG Clearing Central Counterparty

By Aduragbemi Omiyale

NG Clearing Limited, a company incorporated on May 24, 2016, to facilitate derivatives trading in the Nigerian capital market, has been given the licence to operate as a central counterparty (CCP).

The authorisation was given by the Securities and Exchange Commission (SEC), the apex regulatory agency in the Nigerian capital market and this licence became effective Monday, June 7, 2021.

With the registration to perform the function of a CCP, NG Clearing becomes the first organisation to carry out this duty in the country. It means the firm has the authority to clear and settle exchange-traded derivative products.

The Chairman of NG Clearing, Mr Oscar Onyema, expressed delight over this development, noting that it will improve the soundness and safety of the Nigerian financial market.

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He said the company will deliver best-in-class post-trade services that manage counterparty credit risk and reduce systemic risk by interposing itself as a guarantor to both parties in a transaction, thus ensuring the successful execution of derivatives and other trades from various trade points in Nigeria.

“NG Clearing will deliver an unparalleled CCP experience for the Nigerian financial and capital markets and will optimise the deployment of its resources to achieve long-term value creation for its stakeholders using a state-of-the-art risk management framework, which complies with global best practices for mitigating settlement risk,” he said.

On his part, the Managing Director of NG Clearing, Mr Tapas Das said the company has sufficient financial resources, including a settlement guarantee fund to cover participants’ risk exposures.

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He noted that members will have access to a wide range of financial reports that equip them with extensive knowledge and enable them to make informed decisions, as well as access to NG Clearing’s bespoke clearing and settlement software application which will support the clearing and settlement of derivative instruments across various asset classes i.e., futures and options contracts on indices, equity shares, commodities, currency, rates etc.

“NG Clearing shall be playing a key role in the financial market ecosystem in the region, upholding stability and safety of the marketplace, through an efficient and timely settlement of derivative trades.

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“The aim is to strengthen the country’s investment environment through solutions that systematically reduce risks, enhance operating efficiency, and minimize costs for all market participants, thereby serving as a catalyst to national development,” he stated.

NG Clearing is promoted by the Nigerian Exchange Group Plc and Central Securities Clearing System (CSCS) Plc along with key stakeholders, including Nigeria Sovereign Investment Authority (NSIA), Access Bank Plc, Consonance Kuramo Special Opportunities Fund I, Coronation Merchant Bank Limited, Greenwich Merchant Bank Limited, Union Bank of Nigeria Plc, United Bank for Africa Plc (UBA) and Association of Securities Dealing Houses of Nigeria (ASHON).

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Economy

CSCS, NGX Lift OTC Exchange by 0.77% After Holiday

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Regconnect CSCS

By Adedapo Adesanya

Appreciation in the stock prices of Central Securities Clearing Systems (CSCS) Plc and the Nigerian Exchange (NGX) Group Plc ensured that the bulls remained on the floor of the NASD Over-the-Counter (OTC) Securities Exchange on Tuesday.

It was the first trading session at the OTC Exchange after the public holiday observed on Monday to celebrate Democracy Day in Nigeria. The unlisted securities market appreciated by 0.77 per cent yesterday.

During the session, shares of CSCS increased by 68 kobo or 3.6 per cent to sell at N18.68 per unit compared to N18 per unit of the previous session, while the NGX Group gained 15 kobo or 0.8 per cent to sell for N20.04 per share versus the previous N19.89 per share.

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The gains recorded by the two securities expanded the market capitalisation of the bourse by N4.09 billion to close at N534.49 billion in contrast to N530.40 billion it ended last Friday.

Also, the NASD Unlisted Security Index (NSI) increased by 5.76 points during the session to finish at 751.95 points as against 746.19 points of the previous session.

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During the session, investors increased the volume of securities traded by 75.8 per cent to 6.5 million units from 3.7 million units, while the value of the trades rose by 74.1 per cent to N129.2 million from N74.2 million, with the number of deals rising by 17.2 per cent to 34 deals from 29 deals.

NGX Group was the most active stock by (year-to-date) with the sale of 266.3 million units worth N6.0 billion, followed by Swap Technologies & Telecomms Plc with 46.6 million units worth N41.0 million and CSCS Plc with 30.9 million units worth N483.3 million.

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Also, NGX Group was the most active stock by value on a year-to-date basis with the sale of 266.3 million units worth N6.0 billion, followed by Niger Delta Exploration and Production (NDEP) Plc with 2.9 million units valued at N900.5 million and FrieslandCampina WAMCO Nigeria with 5.9 million units valued at N750.4 million.

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