Shareholders of Transcorp Hotels Plc have approved its expansion programme to build new properties in Lagos and Port Harcourt and effect upgrade to the Trancorp Hilton Abuja.
The investors further approved the sum of N2.81 billion as dividend, which translated to 40 kobo per share for the 2015 financial year.
Speaking in Abuja during its 2nd Annual General Meeting (AGM), Chairman, Transcorp Plc, Olorogun O’tega Emerhor said the company grew by 20 per cent from N4.5 billion in 2014 to N5.4billion in 2015 while its total assets increased by 30 per cent from N70 billion to N91 billion within the period under review.
The company also recorded a profit after tax of N3.6 billion in 2015 compared to N3.3 billion in the previous year.
He said: “I strongly believe that we will continue to enjoy growth across all our business lines. We have demonstrated our capabilities across products, customer segments and markets. We intend to continue to leverage on this solid platform to achieve our aspirations and deliver value to all our stakeholders.
“The confidence of you the shareholders has been a considerable source of strength for us at Transcorp Hotels Plc. As we step into a new phase of vitality, we continue to rely on this support and confidence.”
Also speaking at the AGM, Managing Director/Chief Executive, Transcorp Hotels, Abuja, Mr. Valentine Ozigbo said the company increase profitability “despite the negative economic fluctuations during the financial year.”
According to him: “The results in the fiscal year 2015 were possible due to efficiency, hard work and resilience of our team members which are hallmarks of our corporate culture.”
He said: “We were recognized globally by the World Travelers Award, winning five awards for the second year consecutively, and adjudged the best case study for the Kaizen Institute West Africa in August 2015.
“We consolidated on our excellent service ratings and won national, regional and international awards and look forward to steady progress in our new expansions and new ventures. All of these could not have been possible without the support of our dear shareholders, bondholders and our entire stakeholders.”
The shareholders also commended the management for the significant improvement in its financial performance as well as offering a dividend in the face of difficult operating environment.
They further hailed the company for successfully issuing its corporate bond following necessary regulatory approvals.
They also applauded the management for being named the best leading business hotel in Africa by the prestigious World Travel Awards.
The capital market, this week, is unlikely to see any relief from last week’s downturn notwithstanding the plans by more companies, especially the banks, to release their last year’s full results and that of 2016 first quarter.
In the wake of the announcement of Morgan Stanley Capital International concerning a possible exclusion of Nigerian equities from its frontier market indexes, the Nigerian stocks traded bearish last week.
The Nigerian Stock Exchange All-Share Index declined 240 basis points week-on-week with year-to-date return at negative 13.7 per cent.
“While we highlight the modest improvement in investor sentiment as indicated by sustained rise in market turnover, we expect the mixed trading pattern (with a bearish bias) to persist in the week ahead as we anticipate more uninspiring 2016 Q1 earnings – particularly from the banks,” analysts at Vetiva Capital Management Limited said in the firm’s weekend report.
Pan-African bank Ecobank Transnational Incorporated kicked off first quarter bank earnings season, with profits down 35 per cent year-on-year, while Unilever Nigeria Plc’s Q1 results showed a recovery in earnings (profit after tax up 76 per cent year- on-year). Overall, the financial services sector (+173 bps) recorded the only week-on-week gains as interest re-emerged for large cap banks.
On fixed income, the Treasury bills market oscillated through the past week as investors reacted to a number of open market operation auctions from the Central Bank of Nigeria and a higher-than-expected inflation figure for the month of March.
Meanwhile, trading in the bond market was largely bearish Monday through Wednesday last week as investors looked ahead to the monthly bond auction.
While buying gained momentum on Thursday despite the bond auction clearing at rates higher than secondary market levels, mild sell pressure resurfaced at week close with yields climbing 4bps on average.
Global markets traded largely positive this past week as speculation over oil output freeze sent oil prices higher ahead of Q1 earnings season. Better-than-expected bank earnings and positive Chinese trade data (exports for the month of March rose 11.5 per cent year-on-year while import fell 7.6 per cent for the same period) further fueled market rally. However, global stocks struggled to hold on to gains on Friday despite release of China’s Q12016 Gross Domestic Product, which came in line with market expectation as optimism over oil output freeze dimmed.
In the same vein, analysts at Meristem Securities Limited said the weak investor appetite for the Nigerian equities market was sustained last week, as the bourse closed negative in four out of five trading days in the week.
For the agric sector, they said, “We view the sector’s ability to attract positive sentiments even in the predominantly bearish market as an indication of a consensus optimism towards the sector, owing to the current administration’s economic diversification strategy to develop the sector.
“However, investors are advised to take position in sector counters based on fundamentals, considering longer-term investment horizon rather than short-term sentiments.
For the banking sector, there were gains during the week, as investors took advantage of the attractive trading prices of some of the sector’s stocks.
“We do not expect this to persist over the next few weeks, as consternation regarding exclusion from the MSCI Frontier market index grows.”
For consumer goods, the year-to-date return of heavyweights like Nestle Nigeria Plc, -25.58 per cent; 7-UP Bottling Company Plc, -19.23 per cent; Cadbury Nigeria Plc, -13.88 per cent; Unilever:, -32.37per cent ; Nigerian Breweries Plc:, -22.06 per cent within the sector, illustrates the persistent negative sentiments towards the sector so far in the year, as precipitated by doubts regarding future financial performances of the sector’s companies in the near term.
“We do not anticipate respite in the near term, as investors continue to price in the current economic and operational risks in the sector. However, we note the opportunity for long-term positioning in fundamentally justified companies at currently depressed prices,” the analysts said.
For industrial goods, they said, “Although we do not anticipate favorable investor sentiments towards the sector this week, our general outlook for building material companies remains strong; while for the insurance sector, we expect news inflows this week to dictate the general market and sector performance.”
They anticipate low levels of activities on the oil and gas sector stocks this week, barring positive news inflows capable of spurring activities.
Shareholders have said that a volatile petroleum downstream market, coupled with foreign exchange challenges facing quoted firms in the country, will further aggravate the woes of the companies.
The shareholders, who spoke in separate interviews, stated that rising fuel cost would continue to push up operating expenditures for companies, which would in turn affect profitability and the amount of dividend that would accrue to shareholders at the end of the day.
They, therefore, urged the different agencies of government responsible for monitoring the activities of oil marketers, including the Petroleum Products Pricing Regulatory Agency and the Department of Petroleum Resources, to intensify their operations and ensure that market rules were strictly adhered to.
The President, Progressive Shareholders Association of Nigeria, Mr. Boniface Okezie, told our correspondent that rising energy cost was impacting negatively on the performances of corporate institutions, and the earlier the government stabilised the operations of the petroleum market, the better it would be for business.
“Small businesses that need little amount of petrol to operate are not finding it easy, how much more firms that consume huge quantum on a daily basis. Something must be done now to stop the mess,” he said.
But the Assistant General Manager/Head, Lagos Zonal Office, PPPRA, Mr. Soji Soloye, said the agency had started its own monitoring in the Lagos metropolis, where most corporate organisations are operating from, and was not leaving the job to the DPR alone.
He said over 25 petrol filling stations in Lagos had been visited as of last week, adding that the target was to inspect as many as possible to ensure that Nigerians did not pay beyond the official pump price.
Cement Company of Northern Nigeria (CCNN) Plc. has recorded a turnover of N13.04 billion in 2015 operations.
Major highlights of the audited report and accounts of CCNN for the year ended December 31, 2015 showed that the company recorded pre and post tax profits of N1.55 billion and N1.20 billion respectively on a turnover of N13.04 billion during the year. Gross profit stood at N3.96 billion.
The company improved its intrinsic value during the year with net assets per share rising by seven per cent from N7.52 in 2014 to N8.07 in 2015. Total assets also rose by nine per cent from N15.78 billion to N17.15 billion. Non-current assets had grown by 21 per cent from N8.37 billion to N10.12 billion. Shareholders’ funds also improved by seven per cent from N9.45 billion in 2014 to N10.14 billion in 2015.
The Board of Directors has recommended a total of N125.7 million to shareholders as cash dividends for the 2015 business year, representing a dividend per share of 10 kobo.
The dividend recommendation implies that the board of directors took a long-term and prudent view of dividend pay out by retaining higher net earnings to support the company. The board decided to reduce the pay out ratio from about 23 per cent of net profit in 2014 to 10.5 per cent of net profit in 2015, flowing back larger profit into the company”‘ s operations.
Commenting on the results, Managing Director, Cement Company of Northern Nigeria (CCNN) Plc, Malam Ibrahim Aminu, said the company’s performance in 2015 showed steadiness and resilience when viewed against the background of macroeconomic challenges especially in the areas of energy supply and foreign exchange.
Without access to gas because of its location in Sokoto, Sokoto State, CCNN depends on Low Pour Fuel Oil (LPFO), which it sources from Nigeria National Petroleum Company (NNPC), Kaduna Refinery. CCNN is therefore exposed to twin risks of the high cost of LPFO and the fluctuation in supply. LPFO price accounts for 65 per cent of the company’s cost of production.
A don at the Michael Okpara University of Agriculture Umudike, Abia State, Prof. Michah Chukwuemeka Okafor, has said that the recent implementation of treasury single account (TSA) in Nigeria will stop banks from profiteering on free money.
The university lecturer further said the initiative would also lead to fundamental changes in the country’s economy and also help improve fiscal and monetary policy coordination, adding that that Nigeria stands to benefit greatly from the holistic implementation of TSA in the country.
Okafor, a fellow of the Institute of Chartered Accountants of Nigeria (ICAN), said this in a paper, titled: “Full Implementation of Treasury Single Account in Nigeria: Implications on the Economy,” which he presented at a public lecture at the Evangel University, Okpoto, Ebonyi State.
He said: “TSA will lead to better fiscal and monetary policy coordination, as better transparency is achieved through reconciliation of fiscal and banking data, which in turn improves the quality of fiscal information and management that will benefit and improve the country’s economy generally, eventually.”
Commenting on the how the policy would affect the banking sector, Okafor said banks profiteering on free money was dangerous to Nigeria’s economic growth, saying “our bankers are worried by the absence of free government funds, which makes them look suspect on their activities.”
According to the professor of accounting, implementation of TSA in Nigeria would basically result to fundamental changes in the economy and would help government to unify banking arrangements, guarantee oversight of cash resources, promote efficiency, transparency and accountability in government payments, adding that it would ensure that government has access to funds when needed and reduce overall cost of government borrowing.
He outlined about nine benefits of TSA, among which are guarantee of timely information on government cash resources as complete updated balances will be available daily; better appropriation control, as it allows the Ministry of Finance to have full control over budget allocations and strengthens the authority of the budget appropriation; improvement on the operational control during budget execution in an efficient, transparent and reliable manner; ensuring efficient cash management, such as regular monitoring of government cash balances; supports efficient payment mechanisms because there is no ambiguity as to the volume or the location of the government funds, and makes it possible to monitor payment mechanisms.
Other benefits of TSA that Okafor highlighted include: ensuring bank reconciliation and quality of fiscal data because as he explained, with effective reconciliation between the government accounting systems and cash flow statements from the banking system, the risk of errors in reconciliation processes was reduced and there would be improvement on the timeliness and quality of the fiscal accounts; reduction in fiscal deficit; reduction on bank fees and transaction costs; while unnecessary delays in remittance of government revenue will now be reduced thereby cubing sharp practices to enhance prompt release of funds for projects.
The Securities and Exchange Commission (SEC) has announced the extension of the new minimum capital requirement deadline for Capital Market Operators (CMOs) to December 31.
The deadline was extended by 15 months against the initial period of September 30, 2015.
Besides, the commission said it has formed a group that would engage MSCI index provider on the recent announcement that it could remove Nigeria from its frontier market index,
Addressing Journalists at the commission’s 2016 first quarter post-Capital Market Committee (CMC) media briefing held in Lagos yesterday, Gwarzo said that the commission had set December. 31, 2016 as the final deadline for the recapitalisation exercise for all CMOs.
“SEC has extended the deadline for registration which expired yesterday April 13th with 150 days, and has magnanimously volunteered to underwrite the N100 cost placed on registration from the date of expiration,” he added.
He stressed that the commission would continue to clear any operator that meet with the recapitalisation exercise till December. 31, 2016.
He pointed out that the licence of any operator that fails to meet up with the requirement will be cancelled after December. 31, 2016, adding that any operator that failed to meet up with the recapitalisation exercise would seek for new licence at the expiration of the deadline if he or she wished to operate in the market in future.
“Any operator that shows proof of compliance will be cleared by the commission to come back to the market within the grace period.
“After the 15 months grace period any operator that wants to come back will begin a new process of licence acquisition,” he stated.
Concerning the announcement by MSCI index provider that it could remove Nigeria from its frontier market index, Gwarzo noted that SEC has formed a small group that would engage the index providers on the implications of the decision.
He added that the action would have a multiplier effect on the economy and SEC status as a board member of IOSCO and AMERC executive members.
“Even today (yesterday), we held a meeting on that issue with the leadership of SEC and we have made up a small group of people that would also engage them, telling them the implication, not only to capital market but also the SEC.
“If they do that, the implication will have a multiplier effect, apart from the economy but also the status of SEC, as a board member of IOSCO and AMERC executive member.”
The National Bureau of Statistics on Wednesday stated that the 36 states of the federation and the Federal Capital Territory got a total credit of N13.1xtn from banks in the 2015 fiscal period.
The bureau, in its states’ bank credit and deposit statistics, stated that within the period, a total sum of N17.1tn was deposited in banks by the state governments. The report, a copy of which was made available to our correspondent, stated that with a value of N10.1tn, Lagos State had the highest amount of credit from the banks.
This was followed by Rivers, with N658.2bn; the Federal Capital Territory, N402.1bn; and Kano State, N185.05bn.
Abia accessed N72.3bn; Adamawa, N45.6bn; Bauchi, N31.09bn; Bayelsa, N26.1bn; Borno, N55.49bn; Cross River, N121.9bn; Delta, N159.9bn; Ebonyi, N44.8bn; Edo, N70bn; and Ekiti, N31.5bn.
The Nigerian Stock Exchange (NSE) has announced that its dual listing between NSE and London Stock Exchange (LSE) would facilitate seamless cross-border access for the nation’s bourse, to ultimately drive deeper markets that enable capital formation for businesses, through creation of larger liquidity pools and greater competitiveness for Nigerian investors.
This synergy, according to the Chief Executive Officer of the NSE, Oscar Onyema, would enhance capacity and promote diversity of investment products to meet the needs of a wide range of investors and issuers.
Addressing participants during the second NSE/LSE conference held in Lagos yesterday, Onyema explained that as government grapples with the task of articulating a clear economic blue print for the short to midterm within which credible fiscal and monetary policies can emerge, the need to leverage and embrace the globalisation of economies and financial markets becomes clearer.
One of the things that Nigeria (and Africa) needs to sustain its growth, is a solid and vibrant capital market ecosystem that will attract investment and unlock the potential that exists in the economy, ” he said.
According to him, in order to position the nation’s capital market as the sustainable financial centre in West Africa, and for Africa, there was need to facilitate the drive for wealth creation for Nigeria, while providing the platform to which global savings can be channelled. We must use this opportunity to partner with each other, to enable us further unlock our growth potential, and advance the development of our financial and capital markets.”
He urged all stakeholders to create synergies that would unlock the growth potential and advance the development of the nation’s capital markets.
According to him, the first quarter of 2016 has been a wild ride for most economies and markets because asset prices collapsed during the period.
Onyema said that capital markets were critical to sustainability of growth and development in any economy.
He explained that Nigeria needed to sustain its growth through a vibrant capital market ecosystem that would attract investment and unlock the potential that exists in the economy.
Onyema added that capital markets increase the proportion of long-term savings that would be channelled to long-term investments.
He added that Nigeria remained top of mind on the African continent for investors in spite of the intricacies facing the economy and markets.
The Chief Executive Officer and Director of International Development, LSE Plc., Nikhil Rathi explained that London market attracts issuers all over the world that wants to access capital within the world.
“We have analysts that understands Africa and wants to invest in Africa market and that make a difference. Investors can be able to access capital quickly. We witness the highest capital raising last year.”
The Securities and Exchange Commission (SEC) has announced that it has recovered 1,662 share certificates from Alliance Capital Management Company Limited (ACMCL), urging the company's investors to come forward and claim their certificates.
Clients of ACMCL are also advised to visit the Commission's website for their names and thereafter visit the Commission's Head office or any of its zonal offices nearest to them to collect their certificates .
SEC had received about 250 complaints against ACMCL between June 2007 and March 2010, bothering on failure, refusal, and neglect to forward to Registrars, certificates received from Investors/Clients for verification and lodgment in the Central Securities Clearing System (CSCS).
The Commission conducted preliminary investigation and the matter was referred to the Administrative Proceedings Committee, which disqualified the Managing Director, Edward Koki from participating in the capital market for life in line with the Provisions of Rule 20 (B) of SEC Rules and Regulations 2007. The operator's license was also withdrawn by the Commission.
The Commission subsequently recovered the 1,662 share certificates belonging to various investors from the firm. According to SEC, the collection period, which started from April 8, 2016, will lasts till July 8, 2016, which is exactly three months from the date of the announcement.
"Please you are advised to come with proof of ownership and a valid means of identification such as international passport, driver's license, national I.D card or permanent voter's card," SEC advises.
GTL registrar has provided explanation to some shareholders' complaints about the reduction in the number of shares they hold in Union Bank Plc. without their permission.
Specifically, some shareholders, led by one Mr. E.O. Orefuye, have complained to The Guardian's Capital Market Complaint/Feedback desk that the number of the shares they acquired in Union Bank Plc. were reduced and that they were not privy to the decision to reduce the number of their share holding in the bank.
For example, Orefuye said his own total units of more than 23,000 ordinary shares were shrunk to only 4,000 without justification.
Based on the complaints, The Guardian contacted GTL registrar, which handles Union Bank register of shareholders.An official of the firm, Mr. Olorunyomi Iwanefu said the decision to tamper with the number of shares each shareholder has in the bank was done after the statutory due process was strictly adhered to.
According to him, a court ordered meeting of Union Bank of Nigeria Plc's shareholders, which was held on September 30, 2011, deliberated on the issue of Union Bank's recapitalisation exercise, which was in line with the Central Bank of Nigeria's directive and the share capital of Union Bank of Nigeria Plc. was reconstructed at a ratio of 3:16 basis, that is 3 new shares for every 16 old shares held.
He said the total shareholding of the shareholder (Mr. E.O. Orefuye) on the records of GTL before the reconstruction was 22,064 units and after reconstruction, his current shareholding is 4,137 units of ordinary shares.
Iwanefu, while saying the transaction was done in line with the investment law in the country, advised any shareholder, who has complaints to feel free to contact them (registrars) for solutions to such complaints, adding that the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) will not permit any shareholder in the equities market to be cheated.
