Economy
Notore Chemical Makes Move to Address Red Flag Raised by Auditors
By Dipo Olowookere
This week, precisely on Tuesday, December 31, 2019, the Nigerian Stock Exchange (NSE) posted the audited financial statements of Notore Chemical Industries Plc for its full year ended September 30, 2019 on its online platform.
In the brief analysis of the results by Business Post, it was observed that the revenue generated by the firm in the period under review depreciated to N21.4 billion from N26.8 billion, while the gross profit reduced to N4.0 billion from N9.6 billion, with operating profit going down to N3.4 billion from N9.2 billion.
In the period under review, the company declared a loss before tax of N10.3 billion against N3.5 billion a year earlier and a loss after tax of N5.8 billion in contrast to N1.9 billion 12 months ago.
The firm enjoyed a deferred income tax of N4.5 billion in the period under consideration, higher than the N1.6 billion it similarly had in the corresponding period of 2018. A look at the earnings per share (EPS) showed a -N3.57 compared with -N1.18 in the previous financial year.
One of the things that caught the attention of Business Post in the results is the report of the auditors, PwC, which said Notore Chemical may be unable to realise their assets and discharge their liabilities in the normal course of business.
“We draw attention to Note 29 to the consolidated and separate financial statements, which indicates that the group and company incurred net losses of N5.75 billion and N5.68 billion respectively for the year ended September 30, 2019 and, as of that date, the group and company had net currency liabilities of N37.03 billion and N37.71 billion respectively.
“As stated in Note 29, these events or conditions, along with other matters as set forth in Note 29, indicate that a material uncertainty exists that may cast significant doubt on the group and company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter,” the auditors stated.
A check on the Note 29 showed that the company agreed with the red flag raised by PwC, but said it was putting up measures to return the company to profitability and improve working capital.
“Management has embarked on a Turn Around Maintenance (TAM) of its production plant and equipment to improve its reliability and increase production output. The TAM programme will involve replacement/rehabilitation of some critical production equipment, stock up of some critical equipment spares and acquisition of a back-up 44 megawatts gas turbine,” the firm said in the financial statements.
“This will be funded by a seven-year tenured loan of $37 million to be obtained from the African Export-Import Bank. The approval for disbursement of the loan has been obtained,” it added.
Notore Chemical said some equipment in the TAM programme have already been purchased and installed using the company’s operating funds, while some other critical equipment with long lead times have been ordered and are awaiting delivery.
“The early works done under the TAM programme have begun to have some positive impact on plant reliability and sustained production, as the plant recorded a remarkable landmark achievement of uninterrupted round the clock operations of 100 consecutive days on December 15, 2019. This is the longest period of uninterrupted consecutive plant operations achieved in the history of the company,” it further said.
It further said the TAM programme is estimated to last a period of 12 months with completion time set for end of Q3 of 2020, adding that the TAM programme, once completed, is expected to improve significantly the plant’s reliability and production output to meet and sustain its 500,000 MT per annum design nameplate capacity.
“Achieving this level of production output will not only lead to significant improvements in the Group and company cashflows from operations, but also significantly increase annual revenues post the TAM programme,” the Note 29 pointed out.
“The directors are of the firm belief that upon implementation of the plans mentioned above, there would be significant reduction in the company’s debts, whilst also improving the reliability of the plant, thereby returning the company to profitability,” it added.
On Friday, Notore Chemical, in a disclosure, said the TAM programme is expected to “also increase reliability index from the current level of 67 percent to 95 percent” especially with the acquisition of N13 billion loan facility from African Export-Import Bank and with the objective “to accomplish the maintenance activities within a period of 30-day production to production.”
By Aduragbemi Omiyale
Shares of First Holdco Plc worth N45.0 billion issued through a private placement have been listed on the Nigerian Exchange (NGX) Limited.
A circular issued by the Head of Issuer Regulation Department of the NGX Regulation Limited, Mr Godstime Iwenekhai, disclosed that the equities were admitted for trading at the stock market on Monday.
According to the notice, the additional shares brought for listing to rank pari passu with existing shares of the organisation were 1,021,334,544 units.
These stocks were sold to one of the company’s major shareholders at a unit price of N44.06, amounting to N45.0 billion.
The total issued and fully paid-up shares of First Holdco, as a result of this listing, are now 45,475,027,677 ordinary shares of 50 Kobo each.
“Trading licence holders are hereby notified that an additional 1,021,334,544 ordinary shares of 50 Kobo each of First Holdco Plc were on Monday, June 22, 2026, listed on the daily official list of Nigerian Exchange Limited.
“The additional shares listed on NGX arose from the company’s private placement of 1,021,334,544 ordinary shares of 50 Kobo each at N44.06 per share.
“With the listing of the additional shares, the total issued and fully paid-up shares of First Holdco Plc have now increased to 45,475,027,677 ordinary shares of 50 Kobo each from 44,453,693,133 ordinary shares of 50 Kobo each,” the disclosure stated.
By Adedapo Adesanya
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has approved fresh import licences for petrol and diesel for the third quarter of 2026 (July – September) to prevent potential supply shortages in the domestic market.
According to a report by global energy intelligence firm, Argus Media, the latest approvals were issued to major downstream operators amid declining fuel stock levels and concerns over reduced petrol production at the 700,000 barrels per day Dangote Petroleum Refinery in Lagos.
The move comes as Nigeria continues to balance increasing local refining capacity with the need to guarantee adequate supplies of petroleum products across the country.
According to the Argus report, domestic firms, including AA Rano, AYM Shafa, Bono Energy, Nipco, Matrix Energy and Pinnacle Oil, received permits to import Premium Motor Spirit, popularly known as petrol, during the July-September period.
The publication further reported that the same companies, with the exception of Nipco, were granted approvals to import Automotive Gas Oil, commonly known as diesel. The fresh approvals follow an earlier batch of petrol import permits issued by the regulator in May, covering about 720,000 metric tonnes.
Quoting a regulatory source, Argus noted that many of the companies granted the latest approvals were among those that had received permits in previous rounds. “These are some of the same ones that previously received the PMS permits,” the source was quoted as saying.
It was also claimed that AA Rano and Matrix Energy each received approvals to import 180,000 metric tonnes of petrol. AYM Shafa received approval for 120,000 metric tonnes, while Pinnacle Oil received a permit covering 150,000 metric tonnes.
For diesel imports, Argus reported that AYM Shafa obtained a permit for 60,000 metric tonnes, while Pinnacle secured approval for 45,000 metric tonnes. The report stated that the import approvals were issued only recently, after being delayed from an initial target date of June 15.
By Adedapo Adesanya
Three securities weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.01 per cent on Tuesday, June 23, dragging the market capitalisation down by N25.91 billion to N2.544 trillion from Monday’s N2.570 trillion. Also, the NASD Security Index (NSI) decreased by 43.17 points to 4,239.34 points from 4,282.51 points.
The triplet price losers were Central Securities Clearing System (CSCS) Plc, which gave up N4.82 to trade at N75.00 per unit versus Monday’s closing price of N79.82 per unit. NASD Plc depreciated by N3.70 to close at N33.30 per share compared with the preceding day’s N37.00 per share, and Nitrox Industrial Gases Plc marginally lost 1 Kobo to sell at N21.41 per unit, in contrast to the previous session’s N21.42 per unit.
Tuesday’s trading data showed that the volume of securities traded by investors retreated by 35.9 per cent to 211,671 units from 330,034 units, and the value of securities fell by 82.9 per cent to N5.6 million from N32.7 million, while the number of deals doubled to 38 deals from 19 deals.
At the close of trades, Great Nigeria Insurance (GNI) Plc was the most traded stock by value on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units valued at N6.5 billion, and CSCS Plc with 68.1 million units transacted for N4.7 billion.
GNI Plc also closed the trading day as the most traded stock by volume on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, trailed by Infracredit Plc with 2.3 billion units exchanged for N6.5 billion, and Resourcery Plc with 1.1 billion units sold for N415.7 million.
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