Economy
Flour Mills Raises Dividend Payout by 17% as Profit Jumps 185%
By Dipo Olowookere
Shareholders of Flour Mills of Nigeria Plc will receive a higher dividend this year than they got from the company last year.
This is because the board of the flour miller has increased the dividend payout for the 2019 financial year by about 17 per cent.
On Monday, August 3, 2020, the firm released its financial statements for the year and from the analysis by Business Post, the shareholders will get a cash reward of N1.40 for each of their company’s stocks in their portfolio. For the 2018 fiscal year, investors were paid N1.20 per unit.
In a notice today, Flour Mills said it will pay the dividend to shareholders on Monday, September 14, 2020, directly to their bank account.
However, the beneficiaries will only be those whose names appear on the register of members as at the close of business on Friday, August 14, 2020, while the register will be closed from Monday, August 17 to Friday, August 21, 2020.
Business Post observed from the financial status of Flour Mills that it had a fruitful 2019 as the revenue grew to N573.8 billion from N527.4 billion despite the hard operating environment, which prevented the company to export some of its products through the land borders to neighbouring countries.
The increase in the turnover was only boosted by the higher local demand for the company’s flour, pasta, snacks and noodles, contributing N358.4 billion to the total turnover compared with the previous year’s N335.6 billion, while the sale of agro-allied products and sugar accounted for N105.5 billion (versus N88.1 billion in FY’19) and N97.6 billion (versus N82.7 billion in FY’19) respectively.
According to the firm, revenue from customers domiciled in Nigeria amounted to N569.4 billion (2019: N520.2 billion), while revenue from foreign customers (export revenue) amounted to N4.3 billion (2019: N7.2 billion.
It further said one of its major customers from the food segments represented approximately N12 billion (2019: N15 billion) of the group’s total turnover.
In the year, the cost of sales jumped to N508.0 billion from N474.1 billion in 2019 as a result of the higher cost of raw and packaging materials and production employee costs.
During the period, the gross profit increased to N65.8 billion from N53.4 billion, while the net operating gains dropped to N4.9 billion from N6.2 billion despite an increase in fair value gain on derivatives, government grants, insurance claim and rental income.
The net operating gains were impacted negatively by loss on exchange differences loss on disposal of property, plant and equipment as well as sundry loss.
Furthermore, the selling and distribution costs rose to N9.3 billion from N8.2 billion, while the administrative expense jumped to N23.4 billion from N19.4 billion, leaving the operating profit at N35.1 billion as against N32.3 billion in FY 2019.
In the period under consideration, the investment income of Flour Mills rose significantly to N2.4 billion from N768.6 million, while the finance costs went down to N20.0 billion from N22.9 billion.
The profit before tax appreciated to N17.5 billion from N10.2 billion, while the net profit astronomically jumped by 185 per cent to N11.4 billion from N4.0 billion.
By Adedapo Adesanya
Three securities lifted the NASD Over-the-Counter (OTC) Securities Exchange by 1.38 per cent on Friday, July 3, with the NASD Security Index (NSI) up by 58.80 points to 4,307.26 points from 4,248.46 points, and the market capitalisation closing higher by N35.30 billion to N2.585 trillion from N2.549 trillion.
The price gainers were led by 11 Plc, which expanded by N20.05 to close at N220.55 per share compared with the previous day’s N200.50 per share, FrieslandCampina Wamco Nigeria Plc increased by N5.36 to N151.82 per unit from N146.46 per unit, and Central Securities Clearing System (CSCS) Plc appreciated by N3.52 to N90.74 per share from N87.22 per share.
Yesterday, the value of transactions surged by 1,431.2 per cent to N160.1 million from the preceding session’s N10.5 million, and the volume of trades rose by 303.7 per cent to 1.8 million units from 440,653 units, while the number of deals decreased by 34.4 per cent to 21 deals from 32 deals.
Great Nigeria Insurance (GNI) Plc was the most traded stock by value on a year-to-date basis, with 3.4 billion units sold for N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units worth N6.5 billion, and CSCS Plc with 70.7 million units transacted for N4.9 billion.
GNI Plc was also the most traded stock by volume on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, followed by Infracredit Plc with 2.3 billion units exchanged for N6.5 billion, and Resourcery Plc with 1.1 billion units traded for N415.7 million.
By Dipo Olowookere
The losing streak on the Nigerian Exchange (NGX) Limited was halted on Friday after the bourse closed higher by 2.19 per cent at the close of trading activities.
The gains reported by Nigerian stocks were buoyed by renewed bargain-hunting by investors, which resulted in all the key sectors of Customs Street ended in the green territory.
The banking space rose by 2.78 per cent, the insurance counter appreciated by 1.26 per cent, the energy segment expanded by 0.36 per cent, the consumer goods index chalked up 0.06 per cent, and the industrial goods sector grew by 0.05 per cent.
Consequently, the All-Share Index (ASI) went up by 4,918.37 points to 229,240.34 points from 224,321.97 points, and the market capitalisation increased by N3.156 trillion to N147.103 trillion from N143.947 trillion.
Investor sentiment was bullish after 34 stocks ended on the price gainers’ chart and 18 stocks finished on the losers’ log, representing a positive market breadth index.
The quintet of The Initiates, Universal Insurance, DAAR Communications, Omatek, and Airtel Africa surged by 10.00 per cent to sell for N25.85, 88 Kobo, N1.65, N1.76, and N5,274.00, respectively.
On the flip side, International Energy Insurance lost 9.96 per cent to trade at N4.70, Meyer shed 9.95 per cent to close at N18.55, Veritas Kapital dropped 5.07 per cent to finish at N1.31, Fidelity Bank slipped by 2.17 per cent to N18.00, and Jaiz Bank crashed by 1.84 per cent to N28.12.
During the session, a total of 414.7 million equities worth N25.1 billion exchanged hands in 47,106 deals compared with the 855.4 million equities valued at N28.4 billion transacted in the preceding day in 51,609 deals, implying a contraction in the trading volume, value, and number of deals by 51.52 per cent, 11.62 per cent, and 8.73 per cent, respectively.
By Adedapo Adesanya
The Naira closed flat against the United States Dollar at N1,370.19/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, July 3.
However, it appreciated against the Pound Sterling in the same market segment by N2.29 to settle at N1,829.88/£1 compared with the previous day’s N1,832.17/£1, and marginally depreciated against the Euro by 4 Kobo to close at N1,568.32/€1 versus Thursday’s closing price of N1,568.28/€1.
At the parallel market, the Naira also traded flat against the US Dollar at N1,390/$1, and at the GTBank forex desk, it also maintained stability at N1,832/$1.
Market conditions improved shortly after the following minimal intervention by the Central Bank of Nigeria (CBN) through modest Dollar sales, which boosted liquidity and supported stronger trading activity.
Easing pressure came after half-year profit-taking tapered down, while continued stronger policy signals from the central bank add to near-term support.
Deals executed at the official market on Friday came in at $70.430 million across 82 interbank deals, from $85.517 million the previous day.
Meanwhile, the cryptocurrency market continued its recovery after June non-farm payrolls printed at 57,000, less than half the 113,000 consensus, sending the implied probability of a September Federal Reserve rate hike from 64 per cent to 54 per cent and dragging AI stocks sharply lower.
Weak labour data reduces inflationary pressure and, by extension, the Federal Reserve’s justification for holding rates elevated. That transmission mechanism is direct: lower rate-hike odds compress the opportunity cost of holding non-yielding assets like crypto.
Bitcoin regained the $62,000 mark after it rose by 1.3 per cent to $62,475.29.
Cardano (ADA) gained 6.6 per cent to trade at $0.1759, Ripple (XRP) appreciated by 3.5 per cent to $1.14, Ethereum (ETH) expanded by 2.4 per cent to $1,756.82, Dogecoin (DOGE) improved by 2.1 per cent to $0.0768, Solana (SOL) chalked up 1.8 per cent to $82.65, TRON (TRX) increased by 1.5 per cent to $0.3235, and Binance Coin (BNB) soared by 1.4 per cent to $569.12, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 apiece.
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