Economy

GCR Upgrades C&I Leasing Issuer Rating To BBB(NG)

Published

8 years ago

10/11/2017

By Modupe Gbadeyanka

Global Credit Ratings (GCR) has upgraded the long term national scale issuer rating assigned to C&I Leasing Plc to BBB(NG) and affirmed the short term at A3(NG); with the outlook accorded as stable. According to a statement issued by the local rating agency, the above credit ratings were accorded to C&I Leasing Plc after taking into cognisance of C&I’s well-entrenched position in key markets, as borne out by a relatively strong client retention and progression in market share amidst challenging operating conditions.

It explained that the repositioning of the group’s business focus on strongly performing segments has also supported sound traction in the operating lease space, with performance expected to show resilience through the cycle.

Having registered sound top line growth (at a compound rate of 10.2%) over the four years under review, the group achieved a 43% annualised increase in revenue in 3Q FY17, on the back of new vessel leasing contracts.

The EBITDA margin has shown moderate variability over the review period, with transient compression seen in FY16 offset by the traction from higher-yielding leases secured in the current year.

Specifically, the margin rebounded to 34.7% in 3Q FY17, well above a four-year average of 27.5%, and is projected at 36.2% for the full year.

GCR is cognisant of pressure that could arise from traction in the operating lease profile, which could cause margin volatility, should management fail to manage the residual risk inherent in these contracts effectively.

Accordingly, progress will continue to be monitored closely to assess the repackaging of the underlying assets into new contracts or their disposal to maintain a robust earnings stream or efficiently recycle capital through the cycle, the rating firm said.

Adjusting performance for sizeable distortions arising from cross currency exposures and changes in valuations reveals the moderate cash generative capabilities of C&I’s operations.

That said, note is taken of the capital intensity of the trading cycle and the sizeable debt servicing outflows. GCR has considered the ample untapped facilities that are in place, the strength of the financing counterparties, the risk transfer in respect to the finance leases and sound performance of the leasing book.

As with most lease financing entities, the Group is relatively thinly capitalised. In comparison, debt has risen markedly from just N11bn at FY13 to N29bn at 3Q FY17 to finance the rapidly advancing operating lease exposure, which has seen gross and net gearing trend at high levels, over the review period, closing 3Q FY17 at 435.6% and 413.9% respectively (FY16: 441%; 423%).

That said, earnings based gearing metrics are relatively comfortable for the Group’s operating model, registering at 369% and 350% on a gross and net basis respectively at 3Q FY17 (FY16: 540%; 519%). Coupled with the expected resilience of cash earnings expected over the rating horizon, this gives comfort in spite of the relatively erratic interest coverage metrics.

A significant improvement in profitability metrics, asset quality and gearing could result to a positive rating action.

However, material weakening in profitability, debt to EBITDA or pressure on debt service due to unforeseen fall off in business volumes or deterioration in operating conditions. Furthermore, marked deterioration in asset quality would warrant rating action, GCR noted.

Economy

Seplat Completes Conversion of Onshore Assets to PIA Fiscal Regime

Published

2 hours ago

23/12/2025

Adedapo Adesanya

By Adedapo Adesanya

Seplat Energy Plc has completed the conversion of its operated onshore oil and gas assets to the fiscal regime of Nigeria’s Petroleum Industry Act (PIA), marking a major regulatory milestone for the company.

In a statement issued on Tuesday, the dual-listed Nigerian energy firm said its subsidiaries, Seplat West Limited and Seplat East Onshore Limited, finalised the conversion from the former Petroleum Profits Tax framework to the PIA regime following the fulfilment of all technical and regulatory requirements.

The PIA, signed into law in August 2021, was introduced to modernise governance, improve transparency, attract investment, and make Nigeria’s petroleum fiscal framework more competitive globally.

The conversion covers assets previously held under Oil Mining Leases (OMLs) 4, 38, 41 and 53. During the first nine months of 2025, these assets recorded an average working interest production of 42,591 barrels of oil equivalent per day, accounting for approximately 31 per cent of Seplat’s total output.

According to the company listed on both the Nigerian Exchange Limited and the London Stock Exchange, the PIA framework is expected to support increased investment, production growth and improved operational efficiency. The anticipated impact of the conversion had already been factored into Seplat’s medium-term guidance presented at its Capital Markets Day in September 2025.

Seplat noted that it executed Conversion Contracts with its joint venture partners in February 2023 and has since worked closely with the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to complete the process. New Petroleum Mining Lease (PML) and Petroleum Prospecting Licence (PPL) numbers have now been issued, with PIA-based operations expected to commence from January 1, 2026, subject to regulatory guidance.

Commenting on the development, Chief Executive Officer Roger Brown said the successful conversion reflects the company’s commitment to regulatory compliance and value creation.

“Conversion to the PIA fiscal regime has been an important focus for Seplat, and we are delighted to have delivered, alongside our respective joint venture partners, the conversion of our onshore operated assets within the timeline outlined at our recent Capital Markets Day,” Mr Brown said.

He added that the transition positions the company for improved profitability and stronger cash flow margins in its onshore business.

Seplat also disclosed that it is continuing efforts to convert its offshore assets to the PIA regime, with a target completion date of 2027.

Economy

NASD Index Rises 0.16% on Renewed Investors’ Appetite

Published

5 hours ago

23/12/2025

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange rose by 0.16 per cent on Monday, December 22 as investors showed hunger for unlisted stocks.

Trading data showed that the volume of securities traded at the session surged by 532.9 per cent to 12.6 million units from the previous 1.9 million units, as the value of transactions jumped by 64.3 per cent to N713.6 million from N80.3 million, though the number of deals moderated by 13.5 per cent to 32 deals from the 37 deals recorded in the previous trading session.

Infrastructure Credit Guarantee Company (InfraCredit) Plc ended the day as the most traded stock by value on a year-to-date basis with 5.8 billion units sold for N16.4 billion, followed by Okitipupa Plc with 178.9 million units worth N9.5 billion, and MRS Oil Plc with 36.1 million units transacted for N4.9 billion.

InfraCredit Plc also finished the trading day 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 the sale of 1.2 billion units for N420.7 million, and Impresit Bakolori Plc with a turnover of 537.0 million units valued at N524.9 million.

The unlisted securities market printed a price loser, FrieslandCampina Wamco Nigeria Plc, which dropped 20 Kobo to sell at N53.80 per share versus last Friday’s closing price of N54.00 per share.

However, the loss was offset by the trio of NASD Plc, Golden Capital Plc, and UBN Property Plc.

NASD Plc gained N5.00 to close at N60.00 per unit versus N55.00 per unit, Golden Capital Plc appreciated by 77 Kobo to N8.45 per share from N7.68 per share, and UBN Property Plc improved by 22 Kobo to N2.43 per unit from N2.21 per unit.

As a result, the market capitalisation increased by N3.38 billion to N2.125 billion from N2.121 trillion, and the NASD Unlisted Security Index (NSI) grew by 5.65 per cent to 3,552.06 points from 3,546.41 points.

Economy

Nigeria’s Stock Exchange Sustains Bull Run by 0.26%

Published

5 hours ago

23/12/2025

Dipo Olowookere

By Dipo Olowookere

The bulls remained on the floor of the Nigerian Exchange (NGX) Limited on Monday, rallying by 0.26 per cent at the close of transactions.

This was buoyed by the gains recorded by 34 equities on Nigeria’s stock exchange, which outweighed the losses posted by 20 equities, indicating a positive market breadth index and strong investor sentiment.

Aluminium Extrusion gained 9.72 per cent to quote at N13.55, International Energy Insurance improved by 9.69 per cent to N2.49, Mecure Industries rose by 9.64 per cent to N60.30, Royal Exchange expanded by 9.60 per cent to N1.94, and Austin Laz grew by 9.50 per cent to N2.65.

On the flip side, Custodian Investment depleted by 10.00 per cent to N35.10, ABC Transport crashed by 10.00 per cent to N3.15, Prestige Assurance weakened by 7.41 per cent to N1.50, and Guinea Insurance slipped by 7.38 per cent to N1.13.

During the session, investors traded 451.5 million shares worth N13.0 billion in 33,327 deals compared with the 1.5 billion shares valued at N21.8 billion transacted in 25,667 deals in the preceding session, showing spike in the number of deals by 29.84 per cent, and a decline in the trading volume and value by 69.90 per cent and 40.37 per cent apiece.

The first trading session of the Christmas week had Tantalizers as the most active with 50.2 million units sold for N127.5 million, First Holdco transacted 32.6 million units worth N1.5 billion, Access Holdings exchanged 27.3 million units valued at N562.3 million, Custodian Investment traded 22.1 million units for N857.8 million, and Chams transacted 21.3 million units valued at N71.1 million.

When the closing gong was struck at 2:30 pm to end trading activities, the All-Share Index (ASI) was up by 401.69 points to 152,459.07 points from 152,057.38 points and the market capitalisation went up by N256 billion to N97.193 trillion from N96.937 trillion.