Economy
CSCS Assures Shareholders Sustainable Value, to Pay N1.17 Dividend
By Adedapo Adesanya
Shareholders of Central Securities Clearing Systems (CSCS) Plc have been assured sustainable value as the company saw its profit after tax grow year-on-year by 41.4 per cent to N6.9 billion in the year 2020.
In the audited financial results of the firm released recently, the group improved its profit before tax by 22.3 per cent y-o-y to N7.4 billion from the N6.0 billion recorded in 2019, while the total income went up by 31.3 per cent year-on-year to N12.1 billion compared to N9.2 billion in 2019, with investment income growing by 61.4 per cent to N7.4 billion from N4.6 per cent in the preceding year.
The company also recorded an operating expense of N4.7 billion compared to N3.2 billion, this indicated a year-on-year growth of 46.0 per cent partly, reflecting investments in technology and human capital.
Return on Average Equity (ROAE) grew by 20.3 per cent compared to 15.3 per cent in 2019 while Earnings Per Share (EPS) grew to N1.39 from 98 Kobo in 2019, indicating a 41.8 per cent year-on-year growth.
The group delivered a 20.3 per cent return on average equity for the 2020 financial year, compared to 15.3 per cent in 2019.
According to the statement, total assets grew to N41.4 billion compared to N36.6 billion as at 2019, showing that there was a 13.1 per cent year-on-year growth.
Property, Plant and Equipment (plus intangibles) grew 25.0 per cent in the year under review to N1.4 billion, reflecting continued investments in infrastructure to enhance operational efficiency and resilience.
Equally, shareholders’ funds rose to N35.5 billion, up 7.9 per cent between the period under review, reflecting strong capacity for organic capital growth.
Commenting on the group’s performance, Mr Oscar Onyema, the Chairman, Board of Directors of CSCS, said, “It is exciting to report these stellar results.
“Defying the unprecedented challenges that characterised 2020 financial year, CSCS emerged stronger, delivering outstanding growth in top and bottom-lines, and executing far-reaching initiatives that would sustainably strengthen the competitiveness and resilience of the business.
“Having grown profit by over 41.4 per cent in such a challenging year to deliver 20.3 per cent return on average equity, the board of directors and management are upbeat about the value-accretive prospects of CSCS and we are enthusiastic that the progress made thus far in repositioning the business to efficiently play a more active and leading role in deepening the Nigerian capital market will be sustained.
“With continuous investments in new technologies, talent, and work environment, we are optimistic on the productivity of CSCS going forward.
“Subject to shareholders’ approval at the upcoming annual general meeting (AGM), the board is recommending a dividend of N5.85 billion or dividend per share of N1.17, representing a growth of 36 per cent over the 86 kobo dividend per share paid from the 2019 financial year earnings.”
While commenting on the Group’s results, Mr Haruna Jalo-Waziri, the Chief Executive Officer, said; “Amidst the COVID-19 twin threat to lives and livelihoods, and more importantly the attendant challenges in an economic and business environment, we outperformed budget, reinforcing our commitment to delivering superior value to our shareholders irrespective of the odds.
“These impressive results reflect our enhanced collaboration with different stakeholders and their unflinching support and loyalty to CSCS, as the core infrastructure for the Nigerian capital market.
“Hence, my colleagues and I are excited to dedicate this performance to our esteemed participants, regulator and the Board of Directors, whose support kept us stronger through the pandemic.
“We would continue to invest in our collective objective of deepening the capital market and broader financial system, even as we seek new and efficient ways of enhancing our partnerships for mutual prosperity.
“Having laid a solid foundation over the past three years, we are more than ever-optimistic on the prospect of our business, especially as we diversify the business for enhanced resilience against macro and market volatilities. We will sustain our disciplined cost-efficiency culture, in our commitment to delivering sustainable value to shareholders over the long term.
“We are excited at the 39.0 per cent cost-to-income ratio, despite the impact of exchange rate volatilities and rising headline inflation on our cost base. The years ahead look challenging, albeit more promising than ever, as we reinforce our commitment to leveraging best-in-class technologies and our continuous investments in human capital in delivering value to all stakeholders.”
Also commenting on CSCS’ financial performance, the Chief Financial Officer, Mr Peter Medunoye noted “We recorded impressive double-digit growth in revenue and profitability, and more importantly recorded continuous improvement across all key performance indicators.
“We recorded decent growth in income from our CSD and ancillary services whilst also leveraging our ingenuity in effectively positioning the proprietary investment portfolio for growth.
“Delivering 17.7 per cent and 20.3 per cent return on average assets and return on average equity respectively, we are excited at the capacity of the business in generating internal capital to fund the exciting growth ahead.”
By Adedapo Adesanya
President Bola Tinubu on Friday presented a budget proposal of N58.47 trillion for the 2026 fiscal year titled Budget of Consolidation, Renewed Resilience and Shared Prosperity to a joint session of the National Assembly, with capital recurrent (non‑debt) expenditure standing at 15.25 trillion, and the capital expenditure at N26.08 trillion, while the crude oil benchmark was pegged at $64.85 per barrel.
Business Post reports that the Brent crude grade currently trades around $60 per barrel. It is also expected to trade at that level or lower next year over worries about oil glut.
At the budget presentation today, Mr Tinubu said the expected total revenue for the year is N34.33 trillion, and the proposal is anchored on a crude oil production of 1.84 million barrels per day, and an exchange rate of N1,400 to the US Dollar.
In terms of sectoral allocation, defence and security took the lion’s share with N5.41 trillion, followed by infrastructure at N3.56 trillion, education received N3.52 trillion, while health received N2.48 trillion.
Addressing the lawmakers, the President described the budget proposal as not “just accounting lines”.
“They are a statement of national priorities,” the president told the gathering. “We remain firmly committed to fiscal sustainability, debt transparency, and value‑for‑money spending.”
The presentation came at a time of heightened insecurity in parts of the country, with mass abductions and other crimes making headlines.
Outlining his government’s plan to address the challenge, President Tinubu reminded the gathering that security “remains the foundation of development”.
He said some of the measures in place to tame insecurity include the modernisation of the Armed Forces, intelligence‑driven policing and joint operations, border security, and technology‑enabled surveillance and community‑based peacebuilding and conflict prevention.
“We will invest in security with clear accountability for outcomes—because security spending must deliver security results,” the president said.
“To secure our country, our priority will remain on increasing the fighting capability of our armed forces and other security agencies by boosting personnel and procuring cutting-edge platforms and other hardware,” he added.
By Aduragbemi Omiyale
The deadline for the recapitalisation of the Nigerian pension industry has been extended by six months to June 2027 from December 2026.
This extension was approved by the National Pension Commission (PenCom), the agency, which regulates the sector in the country.
Addressing newsmen on Thursday in Lagos, the Director-General of PenCom, Ms Omolola Oloworaran, explained that the shift in deadline was to give operators more time to boost the capital base, dismissing speculations that the exercise had been suspended.
“The recapitalisation has not been suspended. We have communicated the requirements to the Pension Fund Administrators (PFAs), and we expect every operator to be compliant by June 2027. Anyone who is not compliant by then will lose their licence,” Ms Oloworaran told journalists.
She added that, “From a regulatory standpoint, our major challenge is ensuring compliance. We are working with ICPC, labour and the TUC to ensure employers remit pension contributions for their employees.”
The DG noted that engagements with industry operators indicated broad acceptance of the policy, with many PFAs already taking steps to raise additional capital or explore mergers and acquisitions.
“You may see some mergers and acquisitions in the industry, but what is clear is that the recapitalisation exercise is on track and the industry agrees with us,” she stated.
PenCom wants the PFAs to increase their capital base and has created three categories, with the first consists operators with Assets Under Management of N500 billion and above. They are expected to have a minimum capital of N20 billion and one per cent of AUM above N500 billion.
The second category has PFAs with AUM below N500 billion, which must have at least N20 billion as capital base.
The last segment comprises special-purpose PFAs such as NPF Pensions Limited, whose minimum capital was pegged at N30 billion, and the Nigerian University Pension Management Company Limited, whose minimum capital was fixed at N20 billion.
By Adedapo Adesanya
Three securities weakened the NASD Over-the-Counter (OTC) Securities Exchange by 0.68 per cent on Thursday, December 18.
According to data, Central Securities Clearing System (CSCS) Plc led the losers’ group after it slipped by N2.87 to N36.78 per share from N39.65 per share, Golden Capital Plc depreciated by 77 Kobo to end at N6.98 per unit versus the previous day’s N7.77 per unit, and FrieslandCampina Wamco Nigeria Plc dropped 19 Kobo to sell at N60.00 per share versus Wednesday’s closing price of N60.19 per share.
At the close of business, the market capitalisation lost N16.81 billion to finish at N2.147 billion compared with the preceding session’s N2.164 trillion, and the NASD Unlisted Security Index (NSI) declined by 24.76 points to 3,589.88 points from 3,614.64 points.
Yesterday, the volume of securities bought and sold increased by 49.3 per cent to 30.5 million units from 20.4 million units, the value of securities surged by 211.8 per cent to N225.1 million from N72.2 million, and the number of deals jumped by 33.3 per cent to 28 deals from 21 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc remained the most traded stock by value with a year-to-date sale of 5.8 billion units valued at N16.4 billion, followed by Okitipupa Plc with 178.9 million units transacted for N9.5 billion, and MRS Oil Plc with 36.1 million units worth N4.9 billion.
Similarly, InfraCredit Plc ended as the most traded stock by volume on a year-to-date basis with 5.8 billion units traded for N16.4 billion, trailed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.7 million, and Impresit Bakolori Plc with 536.9 million units exchanged for N524.9 million.
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