May & Baker Nigeria Plc has sustained its positive performance despite the inclement operating environment, recording profit after tax (PAT) of N30.09 million for the half year ended June 30, 2016.
Details of the results showed that May & Baker recorded a turnover of N3.70 billion, showing an increase of nine per cent above the N29.7 billion in the corresponding period of 2015. The company continued to benefit from management’s focus on overall operational efficiency.
For instance, while administrative expenses rose on the back of the high inflation from N263.45 million to N309.48 million; distribution, sales and marketing expenses dropped by 12.4 per cent from N583.20 million to N510.84 million. In all, total operating expenses declined to N820.31 million in 2016 as against N846.65 million in 2015, while finance costs reduced from N284.38 million to N255.80 million.
Consequently, profit before tax rose to N44.25 million, up from N43.73 million recorded in comparable period of 2015, while PAT increased from N29.73 million to N30.09 million. Earnings per share thus improved from 3.03 kobo in 2015 to 3.07 kobo in 2016.
Market analysts said the performance has raised the prospects of good returns in the ongoing business year. The company had increased total dividend payout by 20 per cent to N58.8 million, for the 2015 business year compared to what it paid for 2014 business year.
Managing Director, May & Baker Nigeria Plc, Mr. Nnamdi Okafor, had told shareholders at the 2016 annual general meeting (AGM) that management would remain focused on improving the performance of the company in spite of the challenges in the macro economy. He assured that the company will remain focused on its long-term goal of building a virile and diversified business that can ensure good competitive long-term returns to the shareholders.
Speaking in a similar vein, Chairman of the company, Lt. Gen. Theophilus Danjuma (rtd), told shareholders that the company was set to break new grounds and enhance the value of their investments.
He said May & Baker Nigeria plans to expand into new business areas as it seeks new opportunities that will add value to its performance while sustaining the growth of existing businesses and investments.
According to him, with its existing businesses showing resilience and the continuing operational efficiency of its World Health Organisation (WHO)-certified pharmaceutical complex in Ota, Ogun State, May & Baker is shifting focus to acquire new competences and expand its business into new profitable ventures.
The management of SunTrust Bank Limited, one of the recently licensed commercial banks in the country officially opened its doors to customers monday. The bank has a regional banking licence.
Speaking at the opening ceremony which attracted top government officials, politicians as well as traditional rulers in Lagos yesterday, the Chief Executive Officer of the bank, Mr. Muhammad Jibrin, said the bank was the first fresh banking licence to be issued by the Central Bank of Nigeria (CBN) since 2001.
Jibrin said SunTrust Bank started about six years ago as a mortgage bank, adding that the board and management were able to grow its balance to a reasonable size before they decided to pursue a commercial banking licence from the CBN which they got in September last year. He said the bank would be a financial technology institution that would focus electronic channels by offering telephone, mobile and internet banking services.
“Banking is no longer where you go, it is what people do. Therefore, the only thing that can stand the future is no longer physical branches, but banking services that would be driven by technology. “So, most customers of tomorrow would no longer be the customers that they want to go to the banking hall. So, you need to be able to position the institution to respond positively to the needs and expectations of customers of tomorrow. That is at the heart of our own vision and strategy as tomorrow’s bank today,” Jibrin said.
In his presentation, the Chairman of the bank, Mr. Charles Onyema Ugboko, said establishing a bank amid the present economic situation showed that the board and management are committed to the growth of the Nigerian economy.
In his goodwill message, the Oba of Lagos, Oba Rilwanu Akiolu, urged the management of the bank to remain focused, even as he appealed to them to employ at least 30 per cent of Lagos indigenes. Also, the Obi of Onitsha, Igwe Alfred Nnaemeka Achebe, pointed out that going into business at this time when “everybody else is trying to get out of business, takes a lot of courage, and to go particularly into banking takes triple courage. “But such occasion throws up opportunities to those who can see far and beyond. It is the courage of the founders of this bank that I want to applaud. If you are just coming in to be another bank, then it is not worth coming in.
“So, you have to come in as a bank with a difference. You must change the game. Service and quality should be your focus. I personally believe that the cost level of banks is very high, so if you can bring your own down, you will win,” the traditional ruler said.
On his part, the Lagos branch controller of CBN, Mr. J. Iyari, who represented the CBN Governor, Mr. Godwin Emefiele, urged the board and management of the bank to keep to the rules and be good corporate citizen.
“The bank should try to create market niche, be special and be the bank of choice. I assure you that the CBN will continue to provide a level playing field for all operators in the financial services industry to support the growth and development of our country,” he said.
Also, the President of the Dangote Group, Alhaji Aliko Dangote, who was at the ceremony, commended the bank for taking such as abold step.
“As we speak here today, it might be easy for us to be overwhelmed by many challenges we face as business people. The lack of growth in the major economies of the world, the declining commodity prices in general, the weakness in our economy and the difficulty faced by the banking sector all over the world.”
“But throughout my business life, I have learnt that problems and difficulties are also great opportunities. People can make quite a lot out of difficulties and I think our difficulties in Nigeria today should be turned to opportunities. In this period, you need the courage to attack when others are retreating.
“As you know, in Lagos, we have many projects that we are doing and we are not retreating. We have continued to invest in this downturn, with expectation that our investment would actually pay a handsome reward as the cycle turns. I congratulate you for taking this step when banks all over the world are facing multiple headwinds. I am excited that their courage would be rewarded in the near future,” Dangote added.
The Central Bank of Nigeria (CBN) has granted Fidelity Bank Plc final licence to operate electronic commerce services in Nigeria.
With this development, the bank stated that it is positioned to empower micro, small, and medium enterprises (MSMEs) in line with its strategic business objectives, through the provision of an advanced electronic commerce platform.
Christened ‘The Fidelity GreenMall,’ the bank in a statement described the platform as an online marketplace with fully integrated e-commerce capabilities for online payments, delivery logistics, advertising, and business networking opportunities, amongst others.
Managing Director/Chief Executive Officer, Fidelity Bank Plc, Nnamdi Okonkwo said: “We have always seen access to markets as critical success factor in our quest to deepen our MSME service offering.
“With this approval and given the rapid increase in internet penetration, we see an exciting opportunity to further open up new markets for MSMEs using technology.”
According to him, the central bank’s decision to grant Fidelity full licence to rollout electronic commerce services was driven specifically by the bank’s unique approach to financial inclusion. The Fidelity boss noted that many MSMEs lack requisite expertise and capacity to manage an online store thereby making it difficult for them to make sales.
Okonkwo, however acknowledged the various constraints that hamper growth of MSMEs such as concerns about their funding, poor record keeping, lack of requisite technology tools and epileptic power supply in the country.
He however advised small businesses to take advantage of the online platform to boost their revenues and income by trading on local and international arena.
“We want to raise the level of competitiveness of Nigerian MSMEs in a global market,” he said. Okonkwo pointed out that e-commerce had gained recognition in national and international trade, disclosing that the Bank plans to strengthen the level of participation of Nigerian SMEs in global e-commerce sales.
According to international statistics portal (Statista.com), the retail e-commerce sales worldwide amounted to $1.67 trillion in 2015.
With the projected value of e-commerce in Nigeria expected to hit $13 billion by 2018, according to the CBN, the Fidelity helmsman pointed out that the online platform offers ample opportunity for perceptive businesses to explore and tap into in order to garner more market share. He noted that the online platform fosters linkages to multilateral agencies and organisations to enable MSMEs explore export markets or franchising opportunities.
The FMDQ OTC Securities Exchange recorded 36.13 per cent growth in fixed income and currency markets transactions in July.
The company posted transactions worth ₦12.74 trillion in July compared with ₦9.36 trillion recorded in the preceding month, indicating a growth of 30.60 per cent or ₦3.38 trillion.
A breakdown of the report indicated that foreign exchange transactions accounted for 27.52 per cent of the turnover against the 26.07 per cent achieved in June, a growth of 1.45 per cent.
Transactions in treasury bills contributed 33.62 per cent of the total turnover in contrast with 38.14 per cent recorded in June.
The report showed that FGN2 bonds and unsecured placements/takings accounted for 3.79 per cent against 4.85 per cent recorded in the previous month.
Member-Member trades stood at $1.8 billion in July against $0.9 billion achieved in the comparative month, accounting for 18.97 per cent of turnover in the FX market.
Secured money market (repurchase agreements (Repos/Buy-Backs) stood at 31.02 per cent in contrast with 26.50 per cent posted in June.
The report stated that the first Naira-settled OTC FX Futures contract – NGUS JUL 27 2016 priced at ₦279 per dollar matured during the review period with a total settlement amount of ₦962.23 million paid to counter parties.
The report also noted that transactions in the FX market amounted to $9.46 billion in the review period in July, against $7.51 billion in the previous month, an increase of 25.97 per cent or $1.95 billion.
FMDQ, a securities exchange and self-regulatory organisation registered by the Securities and Exchange Commission, has promised to lead innovation and development in the Nigerian Debt Capital Market space.
It provides a platform for listing, quoting and trading of fixed income and currency products.
The Bank of Industry (BoI) and Gombe State Government have signed a N360million deal for the deployment of pay-as-you-go solar home systems in selected rural communities in the state.
Gombe was one of the states that benefitted from the first phase of the BoI/UNDP rural electrification programme involving one community in each of the six geopolitical zones.
Due to the success of the initial project, the Gombe State Governor, Dr. Ibrahim Damkambo wants the project replicated in other nine local government areas of the state. The acting Managing Director, BoI, Mr. Waheed Olagunju said the project would boost economic activities in the benefiting communities.
The project, which is expected to commence with the deployment of stand-alone solar home systems in Lule 1 and 2 communities in Dukku LGA and Pata community in Yemaltu Debba, will be co- funded by the BoI and Gombe State Government on equal sum of N180 million each. Olagunju said the problem of electricity supply from the national grid in Nigeria underscored the need to explore other sources of power generation.
He said: “The persistent problem of electricity supply from the national grid in Nigeria has made it imperative to explore alternative power supply options to lift Nigeria and its rural communities in particular, out of darkness and provide them a new lease of life afforded by the presence of not only reliable, but clean and sustainable energy.”
He called on other state governors to replicate the solar systems in off-grid communities in their states, adding that it had been stories of improved livelihood, better living condition and economic rejuvenation in the communities where the first phase of the projects were executed.
According to him, “These communities with an average of 200 homes, each hitherto had no electricity and lived in darkness. But since the provision of solar electricity, the lives of the inhabitants of these communities have changed dramatically. “The provision of solar electricity has reduced energy costs, created more micro businesses, improved healthcare and quality of education.”
While underscoring the overall significance of alternative form of energy, Olagunju maintained that it would be difficult for the country to achieve inclusive and sustainable growth and development without taking proactive steps towards addressing the myriad of challenges that had stalled the progress and prosperity of its people, particularly those at the bottom of the pyramid.
Nevertheless, Dankwambo said he asked that the solar system be replicated in nine other local government areas of the state based on the success story of the pilot project. In order to facilitate immediate the commencement of the project, the governor said he had approved the release of N44million, being its own share of the counterpart funding, for the execution of the project, starting in two rural communities of the state.
He said: “It is in our efforts to create job opportunities to our teeming youths that the bank, in conjunction with GVE Project Nigeria Limited, sponsored a pilot mini solar power project in Kolwa in Kaltungo KGA. The project is the first of its kind in the state and in the entire north east geopolitical zone.
“It is gratifying to note that the Kolwa project is improving the living standard of the people in that community. We have indeed realised the immense economic benefits of the mini solar project and decided to replicate in other rural areas. I have approved the release of the counterpart fund to the bank to facilitate early take off of the project.”
In an ambitious expansion bid, Beloxxi Industries Limited has closed a whopping $80million equity investment deal with a consortium of international private equity firms and German Development Bank (KFW-DEG).
According to a statement by the company’s President/CEO, Obi Ezeude, the minority equity sales deal was consummated on August 1, 2016 with all the funds fully disbursed.
Unveiling 8 Miles (London), African Capital Alliance (ACA) (Nigeria) and KFW DEG Bank, Germany as the faces behind the international consortium acquiring the minority equity for five years, Ezeude said the transaction came on stream after six months of intense due diligence and legal negotiations that was concluded on July 1, 2016.
“With this Equity Investment, we will expand our current operations from five production lines to about 10 production lines,” he said, adding: “That will increase our capacity from 40,000 metric tonnes to 100,000 metric tonnes of Beloxxi Cream Crackers per year.” He said the expansion, which will make the company the largest producer of Beloxxi Cream Crackers in Nigeria and sub-Sahara Africa, would increase its staff strength from 2,500 to 6,000.
“This is a landmark transaction that demonstrates the capacity for growth in the manufacturing sector in Nigeria. The investment will further increase the capacity of Beloxxi Industries and enable it explore the export market accessing the much needed foreign exchange whilst maximising the potential for growth in Nigeria,” Ezeude said.
Companies and group of individuals’ ambitious targets to raise funds through Crowdfunding the Nigerian financial markets are being inhibited by the restrictive provisions in the Companies and Allied Matters Act, 1990 and Investment and Securities Act, 2007 the Securities and Exchange Commission (SEC) has disclosed.
Crowdfunding is the use of small amounts of capital from a large number of individuals to finance a new business venture using easy accessibility of vast networks of people through social media and crowdfunding websites to bring investors and entrepreneurs together.
Crowdfunding is very popularly in use in the United States (US), Europe and Asia to raise capital for various financial and non-financial projects. There are more than 1000 Crowdfunding portals worldwide supporting a multi-billion dollar industry. For instance global Crowdfunding hit $16.2 billion in the US in 2014. And given the tremendous growth in online platforms that has led to the success of online shopping portals in Nigeria, many fund seeking corporates and groups have shown interest to source for funds through Crowdfunding in the country.
However, the Director General of SEC, Mounir Gwarzo said crowdfunding cannot be effective in Nigeria for now because of lack of rules and inhibitions in the provisions of CAMA and ISA. Speaking in Lagos last week the SEC boss said while the commission is committed to deepening the nation’s capital market to meet the funding needs of corporates and grow the economy, the legal provisions are a big challenge.
“We are aware of the growing interests among Nigerians to use Crowdfunding to raise funds. However, that cannot materialise now given the legal challenges as a result of the provisions in CAMA and ISA. But we are looking for ways to go about it so that companies will enjoy the benefits of Crowdfunding in the country as well,” Gwarzo said.
According to him, SEC is looking at the Crowdfunding rules in US and Canada in order to ensure an enabling legal and regulatory framework that will support this massive global innovation.
It is believed that equity crowdfunding will prove to be an expedient way for many struggling SMEs to raise capital since they find it difficult to raise startup capital because they are considered as high risk to banks.
The theory behind crowdfunding is that if a large number of people, referred to as the “crowd”, each provide monetary contributions, then it is possible to raise substantial sums of money, without the need to go to traditional lending sources.
However, SEC regulates all securities offered for sale by public companies in Nigeria and currently there are no provisions relating to crowdfunding in the SEC rules. Besides, the provisions of CAMA, regulates the formation and operation of all types of companies and enterprises in Nigeria, will place restriction in dealing with transfer of shares, invitations to the public to subscribe for shares among others.
Dangote Flour Mills on Friday reported a profit before tax of N2.64 billion for the half year ended June 30, after its re-acquisition from Tiger Branded Consumer Goods.
This is contained in a statement issued by the company in Lagos.
The statement said the profit before tax was against a loss of N9.55 billion posted in the corresponding period of 2015.
Its gross profit stood at N14.03 billion during the period, while profit from operating activities rose to N8.47 billion.
The statement said that the financial performance was heart-warming, given that the Dangote Flour Mills recorded losses in the past.
It attributed the growth to the restructuring by the new board and management after the company’s reacquisition, which included the reopening of the closed Dangote Flour Mills in Kano.
Mr Ighodalo Asue, the company’s Chairman, said the firm would continue to embrace investment opportunities to increase market share and shareholders’ value.
Asue said since the takeover that the management had taken a lot steps to reposition the company through expansion to drive growth.
“We bought back Dangote Flour Mills from Tiger Branded and by this move, it means we have a stronger, better sophisticated and more focused Dangote Flour Mills.
“We are also using this medium to restate our commitment to increasing our shareholders value and our dear customers,” Asue said.
He said that the company would continue to invest in the state and other parts of the country and even beyond the country for job and wealth creation.
“It is our hope that our return to Kano will create more job opportunities and impact positively on the economy of the state.
Asue said that Aliko Dangote’s decision to buy back the company had saved the jobs of about 3,000 employees and the shares of over a million shareholders.
He said that the multiplier effect of his investment in the country was immeasurable.
Mr Thabo Mabe, the company’s Group Chief Executive Officer, was also quoted by the statement as saying that it return to profitability was due to several adopted initiatives to increase market share and create value for shareholders.
Mabe said that the company was driven by the vision of putting its products on the table of every Nigerian. NAN
The Nigerian Stock Exchange has modified the listing and trading fees for securities listed and traded on its fixed income market.
The revised fee structure, which will be effective from August 17, 2016, will be piloted for an initial six month period, and then evaluated to determine if it has met its objectives, according to the NSE in a statement.
The Exchange, under the revised fee structure, said it would no longer charge trading fees on fixed income traded on its platform. The initial flat listing application fee of 0.15 per cent for all bond types had been replaced with variable listing application fees, it added.
With this development, the NSE said corporate bonds exclusively listed on the Exchange, with existing equity listing, would attract 0.01 per cent listing application fee. Dual listed corporate bonds with existing equity listing and other corporate bonds would attract 0.0375 per cent listing application fees.
Similarly, the listing application fees for state and supranational bonds had been reduced to 0.05 per cent, it added.
The Exchange also replaced the fixed brokerage commission of 0.0005 per cent with a negotiable rate capped at one per cent. This, it noted, would enable investors to negotiate trading commission with brokerage firms, thus driving competition and best execution.
Speaking on the development, the Director, Capital Markets, NSE, Mr. Haruna Jalo-Waziri, noted that the fee reduction in the NSE fixed income market was in line with the Exchange’s commitment to boost market efficiency.
“The reduction in listing application fees gives issuers opportunity to raise their profile and increase visibility through listing on a globally recognised Exchange with the highest regulatory standards. The aim is to reduce issuers cost of accessing long-term capital and to provide investors with diverse investment products at competitive trading fees,” he said.
The naira pared some its previous day’s loss on the interbank forex market as it appreciated to N314.75 to the dollar on Thursday, stronger than the N317 to the dollar it closed on Wednesday.
The positive momentum displayed by the nation’s currency was attributed to an intervention by the Central Bank of Nigeria (CBN), which sold dollars to boost liquidity and help the naira to strengthen against the greenback.
The central bank asked some traders to bid for $1.5 million each, Reuters reported, adding that the Bank had been selling hard currency since this week.
A total of $6.27 million traded on Thursday. However, on the parallel market, the naira climbed marginally to N395 to the dollar, up from the N394 to the dollar it closed the previous day.
The central bank had intervened in the interbank forex market on Tuesday to help support the naira after it hit an all-time low of N350 to the dollar in thin volume on that day.
The naira has been under pressure since the central bank floated the currency in June to allow it trade freely on the interbank market. The currency has been hit by a plunge in oil prices, Nigeria’s economic mainstay, which caused foreign investors to flee bond and equities markets.
The central bank last month told international money transfer operators to pay dollar proceeds from customer transfers into local commercial banks in naira, while selling the dollars themselves to bureaux de change (BDC) outlets.
On Tuesday the bank pegged the dollar transactions which banks can carry out with BDCs at $30,000 per week and set a margin for the banks to sell dollar to currency outlets at not more than 1.5 per cent over the rate at which they bought.
It hopes the move will help narrow the gulf between the official and black market rates and boost dollar liquidity, traders say.
The central bank set a margin of two percent over the rate at which BDCs sourced dollars from banks as resale premium to customers and pegged BDC disbursement at $5,000 per transaction to cover travel allowance, medical bills and school fees. Meanwhile, the CBN yesterday advised interested International Money Transfer Operators (IMTOs) to apply for licence.
The central bank in a statement last night said it came to its notice that, in spite of its transparency in the licensing of IMTOs in Nigeria, some persons have continued to allege that the Bank has stopped the licensing of interested IMTOs in the country.
“The CBN wishes to state, unequivocally, that it has not foreclosed the licensing of interested players in the IMTO space in Nigeria. Therefore, interested applicants are required to forward their requests for licensing to the Director, Trade and Exchange Department of the CBN, in line with the CBN Guidelines on International Money Transfer Services in Nigeria (2014), which among other things, specifies the minimum technical and business requirements for various participants in the international money transfer services industry in Nigeria. The aforementioned guidelines can be downloaded from the website of the Central Bank of Nigeria, it added, saying it remains committed to providing an enabling environment for international money transfer services in Nigeria.
