Economy
Guinness Nigeria Announces N12.6bn Loss in 2020, ‘Suspends’ Dividend Payment
By Dipo Olowookere
Shareholders of Guinness Nigeria Plc may not get any cash reward for the 2020 financial year ended June 30 because the company board did not recommend any dividend payment for approval at the forthcoming Annual General Meeting (AGM) unlike in the previous years.
The reason for this action may not be far-fetched as the brewery giant had a bad fiscal year because the key performance indicators were not impressive, according to an analysis by Business Post.
In the 2019 accounting year, the board proposed a final dividend of N1.52 each and in the 2018 fiscal year, N1.80 was paid as a cash reward to the firm’s investors. However, in the just-concluded accounting year, no dividend was recommended by the board of directors.
During the year, the company’s revenue depreciated by 21 per cent to N104.4 billion from N131.5 billion in 2019 and this was significantly due to decline in the sale of the company’s products in the local market, Nigeria. Also, revenue from export was largely impacted in the period under review.
It is important to note that in the fourth quarter of the company’s financial year, its core markets; bars, restaurants, hotels, event centres and others were shut down by the federal government because of the COVID-19 pandemic. This may have largely contributed to the huge decline in the revenue generated.
In the results, the firm said its cost of sales reduced to N71.1 billion from N91.4 billion, while the gross profit dropped to N33.3 billion from N40.1 billion.
Also, other income decreased to N503.0 million from N781.5 million, while marketing and distribution expenses were pruned to N18.5 billion from N21.8 billion, with administrative costs rising to N14.3 billion from N9.9 billion.
In the year, Guinness Nigeria recorded an operating loss of 234 per cent, N12.8 billion, compared with the operating profit of N9.0 billion in the 2019 fiscal year, while the finance income reduced to N301.0 million from N750.9 million, with the finance costs jumping to N4.5 billion from N2.6 billion.
While the company had a loss before tax of N17.1 billion versus the pre-tax profit of N7.1 billion a year earlier, it printed a post-tax loss of N12.6 billion compared with the post-tax profit of N5.5 billion in FY’19, indicating a decline by 329 per cent, with the earnings per share at -N5.74 in contrast to N2.50 in 2019.
In the financial statements, Guinness Nigeria said during the initial phase of the lockdown imposed by the federal government, it obtained authorisation “from relevant government agencies to allow the continuation of trading activities, where possible.”
It further said following the easing of the lockdown, “our Benin site has been partially reopened to allow for the running of our spirit line and packaging line within the site.”
“Regarding our Ogba site, the Brew House team has returned to work as well. Within both sites, we continue to strictly control the number of persons on-site in order to ensure adherence to social distancing guidelines and the necessary PPEs (hand sanitizers, gloves, wipes, masks as required) have been provided to all employees.
“Transportation arrangements have also been made for essential employees required on-site and temperature checks continue to be observed before site access is granted to any employee,” it added.
By Adedapo Adesanya
Central Securities Clearing System (CSCS) Plc bested three price decliners to lift the NASD Over-the-Counter (OTC) Securities Exchange by 0.05 per cent on Thursday, July 16.
The securities depository company gained N2.29 during the trading day to close at N92.64 per share compared with the previous day’s price of N90.35 per share.
As a result, the market capitalisation of the bourse grew by N1.42 billion to N2.592 trillion from N2.590 trillion, while the NASD Security Index (NSI) improved by 2.36 points to 4,318.87 points from 4,316.51 points.
The three price losers yesterday were led by 11 Plc, which shed N10.00 to end at N240.00 per unit versus Wednesday’s closing value of N250.00 per unit, FrieslandCampina Wamco Nigeria Plc lost N2.34 to finish at N147.66 per share compared with the N150.00 per share it closed at midweek, and Food Concepts Plc depleted by 7 Kobo to settle at N2.42 per unit, in contrast to the preceding day’s N2.49 per unit.
A look at the activity chart showed that during the session, the value of transactions soared by 43.3 per cent to N104.1 million from the preceding session’s N65.2 million, and the number of deals jumped by 39.3 per cent to 39 deals from the 28 deals completed a day earlier, while the volume of trades contracted by 75.7 per cent to 1.2 million units from 4.8 million units.
When trading activities ended for the day, Great Nigeria Insurance (GNI) Plc led the activity chart as the most active 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 valued at N6.5 billion, and CSCS Plc with 74.9 million units exchanged for N5.3 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Adedapo Adesanya
The Naira further appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, July 16, by 65 Kobo or 0.04 per cent to sell for N1,381.53/$1, in contrast to Wednesday’s closing value of N1,382.18/$1.
This was buoyed by improved FX liquidity to absorb the high demand for Dollars during the trading session.
However, the local currency depreciated against the Pound Sterling in the official market yesterday by N9.48 to close at N1,866.17/£1 versus the preceding day’s N1,856.69/£1, and lost N2.99 against the Euro to quote at N1,582.68/€1 compared with the midweek rate of N1,576.69/€1.
At the parallel market, the Nigerian currency maintained stability against its United States counterpart at N1,405/$1, and at the GTBank FX desk, it remained unchanged at N1,389/$1.
On Thursday, data from the Central Bank of Nigeria (CBN) showed a surge in interbank FX turnover and deal count. Interbank FX activities at the NFEM window increased sharply by 69 per cent to $205.366 million from $121.727 million reported the previous day.
Nigeria’s gross external reserves continue to rise, supported by steady foreign exchange inflows from hydrocarbon receipts, remittances and foreign portfolio investments, boosting market confidence. It settled at $51.893 billion from $51.867 billion the previous day.
The apex bank has also launched a new digital platform that will track every foreign exchange transaction involving Bureau De Change (BDC) operators, marking a major step in its efforts to improve transparency and strengthen oversight of Nigeria’s retail forex market.
In an operational guidance issued on July 15 to authorised dealer banks and licensed BDCs, the CBN introduced the FX BDC Purchase Tracker (FXBT), a centralised electronic portal that will monitor foreign exchange purchases by BDCs from the point of request through approval, settlement and eventual sale.
As for the crypto market, prices were down as the markets weighed fresh US airstrikes on Iran that boosted risk sentiment, with Ethereum (ETH) down by 4.7 per cent to $1,829.37.
Solana (SOL) decreased by 3.6 per cent to $77.49, Dogecoin (DOGE) depreciated by 3.1 per cent to $0.0718, Cardano (ADA) also crashed by 3.1 per cent to $0.1588, Bitcoin (BTC) slumped by 2.9 per cent to $62,820.21, Ripple (XRP) dipped by 2.6 per cent to $1.08, Binance Coin (BNB) fell by 2.3 per cent to $569.02, and TRON (TRX) shrank by 0.8 per cent to $0.3219, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
By Aduragbemi Omiyale
In a bid to help investors recover about N270 billion in unclaimed dividends in the capital market, a nationwide enlightenment campaign has been launched by the Securities and Exchange Commission (SEC).
This initiative involves town hall meetings that would go around the country to sensitise Nigerians on the need to claim these fallow funds.
The Director General of SEC, Mr Emomotimi Agama, speaking at a town hall meeting in Lagos, said the regulator is not happy that investors, who worked hard to purchase shares in the stock market, have not claimed their profits for many years, making unclaimed dividends pile up.
“The commission considers this situation unacceptable. Funds belonging to investors should ultimately find their way back to their rightful owners,” the SEC chief, represented at the event by the Director of Registration and Exchanges, Market Infrastructure Department, Ms Hafsat Rufai, stated.
He said during this campaign Nigerians would be informed of the unclaimed monies, the role of the National Investor Protection Fund (NIPF), and the procedures for verifying and recovering legitimate claims, stressing that SEC is committed to ensuring that investors’ funds are returned to their rightful owners.
The DG stated that unclaimed monies administered by the NIPF include return funds from public offers, scheme consideration arising from mergers, acquisitions and corporate restructuring transactions, as well as other capital market-related funds that have remained dormant.
He disclosed that the town hall meetings would be held in the six geopolitical zones and the Federal Capital Territory.
In addition, electronic and social media platforms would be used to broaden public awareness on this issue, with efforts to be made to address the transmission of securities following the death of an investor, noting that many families were either unaware that their deceased relatives owned shares or lacked knowledge of the legal and administrative procedures required to transfer such investments to rightful beneficiaries.
“As a result, valuable investments and returns on investments sometimes remain inaccessible for many years, thereby denying beneficiaries the financial benefits intended for them,” he said, urging investors to maintain proper records of their investments and encouraging families to take proactive steps to preserve inherited wealth.
