Guinness Nigeria Plc (GUINNESS), the West African nation’s second-largest brewer, said nine-month profit declined 18 percent as weak consumer spending stifled growth.
Net income fell to 7.6 billion naira ($48.3 million) in the nine months through March, compared with 9.3 billion a year earlier, the local unit of London-based Diageo Plc (DGE) said today in a statement on the Nigerian Stock Exchange website. Revenue climbed 3 percent to 94.9 billion naira, while cost of sales increased 7 percent to 48.2 billion naira.
Inflation in Africa’s most populous nation raised raw material costs and crimped consumer spending on beer and non-alcoholic beverages, Guiness Nigeria Chief Executive Officer Seni Adetu said on a conference call in February. The company’s management is scheduled to host a call with analysts at 2 p.m. local time in Lagos, Nigeria's commercial capital.
“It would appear that the company has not yet recovered from the squeeze on household wallets that affected most consumer names last year and brought about a slowdown in beer consumption,” Tunde Abidoye, a Lagos-based analyst at FBN Capital Ltd., wrote in an e-mailed note today. “In addition, we feel Guinness Nigeria’s beer volumes are seeing increasing competition from both traditional rivals such as Nigerian Breweries Plc (NBL) as well as SABMiller Plc (SAB), which is making in-roads into the low-end segment of the Nigerian beer market.”
Guinness Nigeria’s share price was unchanged at 280 naira at 12:03 p.m. in Lagos trading. The stock has increased 1.8 percent this year, compared with a 28 percent gain on the Nigerian Stock Exchange All-Share Index (NGSEINDX).
United Bank for Africa (UBA) Plc has announced its audited financial results for the full year 2012-revealing that total comprehensive income attributable to equity holders stood at N55.53billion, compared with a loss of N1.12billion of the previous year. This is an increase of 5,058.04%.
Profit figures grew by over 905% to close at N54.8billion from the N6.8billion loss it recorded in the previous year, on account of loan provisioning that it did to clean up its balance sheet.
Details of the impressive result released at the Nigerian Stock Exchange to stockbrokers and the financial community, show improvement in all indicies in a performance that has seen the complete turnaround of the pan–African financial services institution.
Profit before tax rose over 295% to N52.00billion in 2012, compared with a loss of N26.60billion in the previous year, whilst Total Comprehensive Income attributable to equity holders grew outstandingly by 5,058% to N55.53billion, compared with a loss of N1.12billion in 2011.
Gross Earnings in 2012 for UBA grew significantly by 34.45% increase in gross earnings to peak at N220.1bn; representing approximately N56.40billion additional revenue from the N163.7bn achieved in the preceding year whilst the bank was able to keep total operating expense lower by 3.30% in the same period under review.
“We achieved those results despite a tough operating environment, demonstrating the strength and resilience of our business model. UBA had a strong year in 2012. Our success was again driven by the strength of our customer-focused, Corporate and Treasury driven business model. We are confident about our ability to deliver sustainable earnings growth in the future. We will continue to strategically invest in our businesses, manage our expenses and contain cost, whilst continually seeking ways to exceed expectations of our stakeholders” said Oduoza.
Commenting further on the performance of the bank, the UBA GMD commended staff for the turnaround performance. “As always, our employees and their dedication to our customers and clients remain the driving force behind our success and I thank them for their tremendous contributions. The bank had a good performance for full year 2012, putting us in a position to commence the journey back to industry leadership and setting the stage for the attainment of our long term strategic intent of being a leading bank on the African continent,” he stated
Also commenting on the results, the Group Chief Finance Officer Ugochukwu Nwaghodoh, said the bank has continued to focus on customer service delivery, efficient capital management and returns maximisation, with return on equity exceeding 30 per cent in 2012, one of the highest in the industry.
“Our ability to serve clients globally with solutions tailored to their needs gives us a strong advantage in today’s rapidly changing and highly competitive market place. Adopting a unique business platform across Africa, as a group, has also ensured that we present a single face to our customers and clients around Africa. This does not only help foster collaboration throughout the Group, it also strengthens our ability to deliver value adding and innovative solutions to our customers and clients through our integrated model” Nwaghodoh further stated.
With operations in 19 African countries and presence in New York, London and Paris, UBA provides banking services to over 7 million customers through expansive retail distribution outlets. Its ability to deliver tailored financial solutions based on high-value customised products and services sets it apart from peers.
Ashaka Cement Plc (Ashakacem) has announced profit after tax of N3.124 billion for the year ended 31st, December, 2012, 8.3 percent improvement over N2.885 billion recorded in the previous year
The slight increase seen in the profitability within the year could not be unconnected with the cost of sales, which remained high in line with 2011 trend, as well huge rise in taxation.
Analysis showed that the company’s cost of sales for the period rose to N13.500 billion compared to N13.276 billion in 2012, while tax payable for the year went up by 86.6 percent to N2.348 billion from N1.258 billion.
Selling and distribution expenses jumped to N617.245 million from N473.905 million, a 30.2percent increase over the period
The administrative expense at N3.775 billion was 13.7 percent increase over N3.321 billion recorded in the same period of 2011.
However, profit before tax rose by 32.1 percent to N5.473 billion from N4.4144 billion in 2011, while gross earning rose to N21.825 billion, a five percent improvement over N20.780 billion generated in 2011.
Basic earnings per share also went up marginally by 8.5 percent to 140kobo from 129kobo in the preceding year
Addressing shareholders at the last annual general meeting, the chairman, Alhaji Umaru Kwairanga, had raised hope about better return, as a result of cost cutting measures he said the company would institute in 2012.
According to him, the objective going forward was to intensify efforts in the acceleration of projects that would improve costs and production volumes so that “We are set to fully participate and enjoy the benefits the deficit in the nation’s housing stock and a large percentage of unpaved road network present in the cement industry.”
He had stated that a key element of the company’s cost reduction effort was focused on increasing the substitution rate of local coal for expensive low pour fuel oil (LFPO) as fuel for firing of its kilns.
Speaking at the event, the Managing Director/CEO, Mr. Neeraj Akhoury, said the prime objective of the company is to maximise the rate of utilisation of production capacity.
“The third and most important objective is to start the first phase expansion through which we should target a production capacity of 1.3 million tonnes.
FBN Holdings Plc is looking for opportunities to enter 11 other countries in Africa, the financial giant's Chief Executive Officer (CEO) Bisi Onasanya has said.
The Nigerian unit of Lafarge Cement said on Monday its first quarter pretax profit rose 20.64 percent year-on-year to 7.19 billion naira, compared with 5.96 billion naira in the same period last year.
Revenues at Wapco, the local unit of the world's biggest cement maker, grew to 23.32 billion naira during the period, as against 22.61 billion naira a year ago, it said in a filing with the Nigerian Stock Exchange.
The company’s biggest performance was in its PAT, which jumped 50 per cent to N6.07 billion, from N4.07billion last year.
The company was able to achieve the result from reducing interest charges from N1.5billion to N982 million. Estimated taxes also fell from N1.9 billion to N1.128 billion.
Analysts said if the company kept up the trend, shareholders may be in for a bumper harvest this year.
Despite Nigeria’s government’s posturing that Nigerians will enjoy steady electricity by 2015, experts say darkness may persist until 2050. And stable power supply may never be enjoyed in this generation.
An expert has told Reuters news agency that Nigeria would need about 140,000MW to guarantee stable power supply.
Nigeria is still scores of years away at this threshold. At present, it generates a meagre 4,000 MW for a population estimated at 170 million.
South Africa, with a population of about 50 million people, produces about 40,000 megawatts of electricity and has been trying in recent years to increase output.
“It will probably take Nigeria another 50 years before it attains the same level of electricity consumption per capita as South Africa currently enjoys today,” David Ladipo, whose company Azura is spending $700 million to build a 450 MW plant, told Reuters.
In comparison, Brazil, with a population of 190 million people, produces nearly 100,000mw of electricity while Egypt, which is half the size of Nigeria, (82 million people), produces 26,000mw and Indonesia, with a population of 240 million people, produces 30,000mw.
The United States with a population of 311 million people and with a total electricity-generating capacity of nearly 1.3 million megawatts was the biggest producer of electricity in the world until a few months ago. It has now been overtaken by China which produces close to 1.4 million megawatts.
In 2010, President Goodluck Jonathan pledged that Nigeria would boost generation from 3,000 megawatts (mw) to 10,000 mw by the end of 2013, and 40,000 mw by 2020. Analysts view this as a mirage.
Ladipo says electricity output could grow to 6,000 mw in the next two years and to 9,000 MW by 2020, before seeing a potential boom as post-privatization investment kicks in.
Reuters said even Ladipo’s more modest projections, which several other industry experts broadly agreed with, face hurdles.
“Privatization is months behind schedule and government is struggling to get the funding it needs for crucial transmission and gas supply infrastructure. Powerful labour unions are blocking attempts to pay off 40,000 state electricity workers,” Reuters said.
“The African Development Bank is providing $150 million to aid with transmission and some of the $1 billion debut Eurobond would help with upgrades. But in Nigeria, just making the money available doesn’t always mean it will be used wisely,” Reuters said.
“Nigeria says it has found 340 billion naira ($2.1 billion) to pay off the workers, but they remain reluctant to leave.
“The African Development Bank is providing $150 million to aid with transmission and some of the $1 billion debut Eurobond would help with upgrades. But in Nigeria, just making the money available doesn’t always mean it will be used wisely,” Reuters said.
About $40 billion had been invested in many power reform drives in the last 20 years, with nothing to show for it. Nigeria is in the process of breaking up the defunct state power company into 17 private generation and distribution companies and selling them for about $2.5 billion in total, as part of efforts to increase electricity output tenfold over the next seven years
First Bank of Nigeria Holdings Plc on Tuesday announced a profit before tax of N92.7 billion for the financial year ended Dec.31, 2012.
In a press statement issued in Lagos, the company said the profit before tax represented a growth of 158.5 per cent compared to the N35.8 billion declared in the corresponding period of 2011.
It said profit after tax grew by 306 per cent to N75.7 billion against N18.6 billion recorded in the preceding year.
The statement said the board of directors of the company was proposing a dividend payment of N1 per share to all shareholders.
It said gross earnings increased by 31.4 per cent to N359.8 billion against the N273.8 billion posted in 2011.
The company’s operating income increased by 25.8 per cent to N298.3 billion in contrast with N237 billion in the previous year, while customer deposits stood at N 2.4 trillion against N2 trillion announced in 2011.
Also, its total assets grew by 11.4 per cent from N2.9 trillion in 2011 to N3.2 trillion during the period under review.
Commenting on the results, Malam Bello Maccido, the Chief Executive Officer, FBN Holdings, said that the focus was on consolidating the group’s leadership position in Nigeria.
Maccido said that the company would continue to grow its different business lines and ensure provision of financial solutions to its customers across the entire value chain.
“We are intensifying efforts to facilitate the realisation of these synergies, crystallise cross selling opportunities and deepen the relationship with our customers,” he said.
Nigeria’s First City Monument bank (FCMB) has announced a growth of 54.3 per cent in gross earnings for the financial year ended Dec.31, 2012.
The bank said in a press statement issued in Lagos on Monday that its gross earnings stood at N116.83 billion in 2012, compared to the N75.70 billion it posted in the corresponding period of 2011.
The bank also declared a bonus of one additional share for every 25 shares held by its shareholders.
“Profit after tax grew by 256 per cent to N15.12 billion in 2012 while profit before tax appreciated by 252.1 per cent during the review period to N16.23 billion.
“Its loans and advances improved by 10.7 per cent to N357.79 billion against the N323.35billion declared in 2011.
“The bank’s total assets appreciated to N909 billion in 2012, in contrast with N895 billion in the comparative period of 2011.
“FCMB’s merger with the defunct FinBank also impacted positively on the performance of the bank as its operating income grew by 37 percent,” the statement added.
Similarly, the bank’s first quarter result ended March 31, 2013 showed, a profit after tax of N4.2billion against the N4.1billion made in the corresponding period of 2012.
Gross earnings increased to N31.41 billion within three months, compared to N26.12billion posted in the preceding year of 2012.
The Group Managing Director/Chief Executive of FCMB, Mr Ladi Balogun, said that the bank was pleased to return to profitability after the challenges of 2011.
Balogun attributed the growth to successful merger between the bank and the defunct FinBank.
“The trend continued in the first quarter of 2013 and we expect our performance to gather momentum as we begin to improve productivity of the immense resources and capacity we have acquired”.
Balogun said that the bank had set a target to be among the top five banks in the country by the year 2015.
The Central Bank of Nigeria has stopped the printing of small denomination naira notes in polymer because they fade quickly.
The Deputy Governor, CBN, Mr. Tunde Lemo, disclosed this in an interview with the News Agency of Nigeria on Sunday in Washington on the sidelines of the ongoing Spring Meeting of the World Bank and the International Monetary Fund.
He said, “By the middle of the year, we will start to produce the second generation of lower denomination notes, now in paper and not in polymer.”
“My plea is that Nigerians should exercise patience; it wasn’t the fault of the CBN; it was just because we had to go back to the drawing board to rethink the ‘Project Cure’ in the light of the wish of the public that we should not go ahead with the N5,000 notes and lower denominations.
“We will correct that in the course of the year. Polymer certainly will be phased out. In fact, we are phasing out polymer. No new note is being printed in polymer now.”
Lemo told NAN that when the CBN was going to introduce the polymer currencies, its search showed that they could last longer than ordinary paper notes.
He said, “However, with the benefit of hindsight, we probably should not have dumped polymer because, yes, the substrate lasts longer, but the in-consubstrate began to fade; we didn’t realise that at the time of introduction.
“So, part of ‘Project Cure’ was actually to move away from polymer substrate to paper; unfortunately, we had a push-back because of the issues around N5,000 note and coins.
“The entire programme was put in abeyance; otherwise by now, we should have stopped producing polymer.’’
Lemo said the CBN had awarded a contract for the printing of the higher denomination notes to a foreign company because of low capacity at the Nigerian Printing and Minting Company.
He said the bank would begin to receive the fresh notes from June.
On the campaign for careful handling of the naira, Lemo said that it was unfortunate that it was not successful, but noted that it was a criminal act to abuse the naira going by the CBN Act.
The deputy governor said, “Unfortunately, CBN is not a law enforcement institution; we left that in the hands of the law enforcement institutions and that has not kicked in.
“I still go to parties and see people spraying money, stepping on money, I see touts distributing mint-fresh money that should go to customers.’’
Lemo also told NAN that the CBN had talked to the police to step up surveillance to reduce their abuse of the naira, adding that the bank had no right to arrest people who sold the currency on the streets.
He said the act of abuse and sale of the naira by touts had defeated the clean note policy of the bank, but assured that efforts were being made to tackle the problem.
The Group Chief Executive Officer of Ecobank Transnational Incorporated (ETI), Mr Thierry Tanoh, said on Monday that the bank was targeting a 50 per cent revenue growth this financial year.
Making the disclosure at the bank’s “Facts Behind the Figures” forum at the Nigerian Stock Exchange (NSE) in Lagos, Tanoh said that the bank’s revenue appreciated by 46 per cent last year.
The bank posted gross earnings of N362.14 billion for the financial year ended Dec. 31, 2012 against the N235.97 billion recorded in 2011.
Its profit after tax stood at N45.49 billion in contrast to the N32.27 billion declared in 2011, indicating an increase of 40 per cent.
The bank’s net asset appreciated to N339.92 billion, compared with N233.39 billion in 2011.
Commenting on the 2012 result, Tanoh attributed the growth to successful integration of its major acquisitions in Ghana and Nigeria and strong demand for retail banking services across its 33 country platforms.
He said that the Nigerian market contributed 40 per cent of the bank’s revenue in the 2012 financial year.
Tanoh said that increased trade and commercial flows between Middle Africa and the rest of the world as well as the performance of the bank’s staff contributed to the growth recorded.
The chief executive officer said that the bank would remain reactive to the yearning of its customers through strong innovations.
He, however, assured shareholders increased returns on their investment in the years ahead.
Tanoh stated that the bank had finalised its integration with the former Oceanic Bank, noting that customers could withdraw their money from any branch.
Earlier, the Chief Executive Officer of the NSE, Mr Oscar Onyema, commended the management of the bank for its achievements.
Onyema said that ETI was among the first quoted companies that embraced the corporate governance policy.
He urged the bank to work closely with the Federal Government to unlock the inherent potential in the Nigerian economy.
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