Skye Bank Plc has demanded for more time to file its unaudited financial statements for the periods ended March 31 and June 30, 2016.
The bank’s position was communicated to the Nigerian Stock Exchange on Tuesday in a letter signed by its management.
The lender said the letter was intended to inform the NSE, regulatory authorities, shareholders and other stakeholders of the reasons necessitating the application for an extension of time within which to file the interim financial statements for the relevant periods.
The extension of time within which to file the interim financial statements, according to the bank, was necessitated by an extension of time to file the 2015 annual financial statements. This, it said, was due to the delay in the annual audit as a result of the challenges faced with the bank’s integration with Mainstreet Bank Limited, which was approved mid-2015.
The bank added, “On July 4, 2015, 12 of the 16 directors on the board of the bank resigned their appointment, and the Central Bank of Nigeria appointed a new group Managing director/chief executive officer, chairman and five other directors on the board.
“The bank is currently auditing its H1 2016 results and is hopeful that the audit process will be completed soon. The interim results will be filed by September 30, 2016.”
Meanwhile, the trading on the floor of the Nigerian Stock Exchange ended on a negative note on Tuesday with market capitalisation dropping by N42bn.
The NSE market capitalisation dropped to N9.366tn from N9.408tn, while the All-Shares Index also plunged to 27,272.14 basis points from 27,394.98 basis points.
An aggregate of 416.785 million shares valued at N2.161bn exchanged hands in 3,443 deals.
On the top five losers’ echelons are Sterling Bank Plc, International Breweries Plc, Mobil Oil Nigeria Plc, MRS Plc and Berger Pains Plc.
On the other hand, Wapic Insurance Plc, Total Nigeria Plc, Skye Bank Plc, FBN Holdings Plc and Nigerian Breweries Plc emerged as the top five gainers.
The share price of Sterling Bank closed at N1.16 from N1.28, losing N0.12 (9.38 per cent), while that of International Breweries declined by N0.95 (five per cent) to close at N18.05 from N19.
Nigerians should prepare for another increase in the pump prices of petrol, due to the continued scarcity of foreign exchange to finance the importation of the product, oil marketers have said.
According to them, the United States dollar hit an all-time high last week, as it exchanged for N400 at the parallel market.
Worried by the development, the marketers say if not urgently addressed, the pump prices of petrol will not remain at the approved rates.
The Federal Government liberalised the downstream sector of the petroleum industry on May 11, 2016, and announced an increase in the pump prices of petrol from N86 and N86.5 per litre to between N135 and N145 per litre.
It also stated that the market was to be driven by the factors of demand and supply, as it was now largely in the hands of private sector players.
But oil marketers told our correspondent on Monday that despite the competition in the business, they were struggling to retain the price of the Premium Motor Spirit within the approved range.
“The truth is that Nigerians just have to brace for higher PMS price; there are no two ways about it. The government cannot fund this market; the money is not just there. Even if the government wishes to assist, it does not have the wherewithal to do. So, Nigerians should brace for higher rates,” an official of one of the notable oil marketing companies, who spoke to our correspondent on condition of anonymity, said.
He added, “We are all aware that the price of crude has been falling in the international market and it is the dollar the government gets from crude sale that it uses to solve forex problems. So, there’s no fast rule or solution to it than for all of us, both users and marketers, to just prepare for a price hike.
“For marketers, they should know that the days of higher profits are gone. Before now, if you want to import petrol, you’ll have to wait for months and possibly bribe some people to get an import licence. But those days are gone; nowadays, every interested dealer can get the licence and this has created room for competition, which is why you still get the product at around N140 to N145 per litre. We only hope that this will continue as the dollar availability improves.”
A member of the Major Oil Marketers Association of Nigeria stated that the ex-depot price of the PMS had remained at N133.28 per litre because the marketers were doing their best to manage the situation.
The marketer, who also pleaded to remain anonymous because of the sensitive nature of the subject, said the PMS dealers hardly got forex at the rate that the government initially promised them.
He said, “It is very logical for the PMS price to rise any moment from now, for there is no way somebody can import at the rate of N400 to a dollar and you expect him to continue selling at the official ex-depot price1. And mind you, the government promised to facilitate forex provision to marketers at N287 to a dollar, because you cannot buy at N400 and expect to continue selling at the prevalent rates you see at filling stations today.
“However, most depots are still managing the situation and are selling at the recommended price of N133.28 per litre to filling stations. It is when it goes above this price that you will notice the eventual increase in the pump prices of the PMS. So, if the trend of forex unavailability continues, then the situation may go out of the control of the marketers.”
On whether oil dealers have a peculiar channel for sourcing forex outside the official and parallel markets, the source said, “There’s no other way for sourcing it. Although outside the parallel market, there is still an autonomous market where you may get the dollar at rates that are less than what you get from the parallel.
“There are usually two prices at the market and marketers look at the one with the lower price, which is mostly the government regulated rate. However, the difference between the two prices is marginal most times.”
A senior official of the Independent Petroleum Marketers Association of Nigeria, Mr. Dibu Aderigbigbe, had earlier told our correspondent that the forex crisis might lead to a further hike in petrol price if it persisted.
“The dollar is the major legal tender used for the importation of petroleum products; so, any crisis in forex will definitely affect the prices of these commodities in the long run. However, we hope the situation is addressed in earnest,” he said.
The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, recently made it clear that the government had liberalised the downstream oil sector, stressing that the refined products and their prices were in the hands of private sector players.
When contacted, the spokesperson for the CBN, Mr. Isaac Okoroafor, said since the flexible foreign exchange rate regime commenced, the apex bank made it clear that all transactions would be based on the prevalent forex market rate.
He said, “As soon as we introduced the new flexible foreign exchange market, it was made clear to everybody that all transactions must go through that market. The only concession we made was that, yes, we agreed that the IOCs will sell dollars to petrol importers, but it must be at the prevailing rate of the market on the day of the transaction.
“What we have done for transactions concerning oil importation is that the IOCs are allowed to sell their foreign exchange to petrol importers, because oil is a very important commodity to the nation. But the IOCs must sell at the ruling exchange rate from the market for that day and this means the prevalent rate for the day.
“For instance, today, the market closed at N311 to a dollar, which means if they (IOCs) are selling, they have to sell to the marketers at that rate. The CBN never promised anybody a lower rate; it is the market that determines the rate.”
However, the spokesperson for the Nigerian National Petroleum Corporation, Mr. Garba-Deen Mohammed, did not answer calls made to his mobile telephone number.
He also did not respond to a text message sent to his telephone on the matter as of the time of filing this report around 9.20pm.
But the General Secretary, Nigeria Labour Congress, Peter Ozo-Eson, said the removal of the fuel subsidy in an import-driven regime for petroleum products was the beginning of crisis.
Ozo-Eson said the NLC had warned Nigerians during the last protest it organised against the increase in the pump price that the subsidy removal would result in an uncontrollable increase in the price of the commodity.
He stated that a look at the current prices of diesel and kerosene showed that the government was only managing the current pump price of petrol to prevent people from losing faith in the decision to remove subsidy on the product without first ensuring local refining.
The labour leader argued that with an exchange rate of N400 to the dollar, the pricing template would be higher than the recommended pump price, which would result in a crisis.
Ozo-Eson stated, “If you recall what led to our strike and protest the other time, then we said that it was the beginning of a crisis to do what they had done under an import regime for petroleum products and that it would lead to a spiral that we would have no control over. And so, I do not see how the price of the PMS will remain at N145 or thereabout with the pressure on the naira, and we predicted that.
“As a matter of fact, when you look at what is happening to the prices of diesel and kerosene today, then you will realise that for now, they are just managing and holding on to the price of the PMS in order for people not to lose faith in what they have done.
“But with time, we are going to face the reality that if the naira is 400 or more to the dollar, and you now go down through the template, you are going to find that the recommended pump price will be much higher and there will be a crisis.”1
He said that the government had the option to either allow the market to collapse or bring in some form of support to address the situation.
According to him, it is up to Nigerians to either endure it or mount pressure on the government to take steps to protect them.
The Debt Management Office (DMO), on behalf of the federal government, has commenced the process of appointing two international banks as joint lead managers and a local bank as financial adviser for the planned Federal Government Medium Term Note (FGMTN) Programme (2016-2018) as well as the issuance of $1 billion out of the $4.50 billion FGMTN programme in 2016.
In addition, the federal government is also seeking to retain the services of an international and Nigerian law firms which will act as joint legal advisers for the FGMTN. The legal advisers will be appointed separately by the DMO.
Furthermore, the federal government plans to engage the services of a technical adviser on communication who will be required to work with other transaction advisers to ensure the successful implementation of the FGMTN.
The DMO, in a notice of request for proposal on the positions being advertised, which was posted on its website, said the the purpose of the FGMTN programme was “to enable the federal government have the flexibility of quickly taking advantage of favourable market conditions in the International Capital Market (ICM) to raise funds, if and only when the need arises”.
It added that bids are to be turned in by 12 p.m on September 19, 2016 at its head office in Abuja, warning that it reserves the right to reject any bid not received by the stipulated time and in the form prescribed by this Request For Proposal.
The debt office further stated that financial bids would be opened after a shortlist of prospective bidders had been compiled on the basis of the evaluation of the technical bids and the interviews.
The floating of the Eurobond is expected to help the federal government fund part of the N6.1 trillion budget for the year as it plans to source N2.2 trillion to bridge the deficit.
The FMDQ OTC Securities Exchange yesterday admitted the UACN Property Development Company (UPDC) N16.799 billion commercial paper (CP) on its platform.
This followed the successfully meeting of the FMDQ OTC listing requirements by UPDC. This CP represents series 1 under the UPDC’s N24 billion CP Issuance Programme.
In his remark, Managing Director/CEO, FMDQ, Mr. Bola Onadele.Koko, congratulated UPDC Plc, saying that the quotation of this real sector CP, was evidence of the positive progression in the Nigerian CP market, serving to instill confidence in the possibilities of the Nigerian financial market. He stated that FMDQ, as the market organiser, desirous of building a sustainable CP market in the Nigerian financial market space, promotes credibility for quoted CPs, through a highly efficient registration process and the provision of invaluable information, instituting financial market infrastructures, in line with global standards, to drive, among others, transparency, governance, market oversight, integrity and market liquidity with a view to protecting stakeholder interests.
In his address MD, UPDC, Mr. Hakeem Ogunniran, acknowledged that the CP issuance had afforded the company a better opportunity to successfully diversify its short-term funding sources at a 25 per cent reduced cost, thereby enhancing their value-creating capability for UPDC’s various stakeholders.
Also speaking, Mr. Kayode Akinkugbe of FBN Capital Limited, noted, “the remarkable success of the UPDC CP issuance is an affirmation of the growth of the CP market in recent years. We are indeed pleased to have partnered with UPDC in establishing its inaugural CP Programme and achieving the significant oversubscription recorded at its debut launch. The success of the deal was influenced by the innovative credit enhancement features developed by FBN Capital Limited and Coronation Merchant Bank Limited.
Speaking in the same vein, Mr. Abubakar Jimoh of Coronation Merchant Bank said the bank is happy to be part of this landmark and novel transaction.
“We successfully offered our superior transaction structuring capabilities to UPDC by jointly providing a liquidity back-stop facility to enhance the CP offering alongside the partial corporate guarantee provided by UACN, (UPDC’s parent company),” he said.
The Nigerian National Petroleum Corporation (NNPC) has reported a deficit of N26.51 billion from its operations in June, just one month after posting a record trading surplus of N274 million in May.
The June 2016 monthly operations and financial report of the corporation which it released last Sunday indicated that it had failed to continue on the positive operational trend it reported in May because of a 13.30 per cent decline in the sales of its subsidiary downstream company – the Pipeline and Products Marketing Company (PPMC) among other issues.
Other operational issues which NNPC said influenced its deficit record in the month of June included reported huge incidents of vandalism at up to 261 points of its pipeline. It said in the report which THISDAY obtained in Abuja that this compounded its operational deficits.
It also stated that a substantial portion of crude oil sales of its exploration and production subsidiary – the Nigerian Petroleum Development Company (NPDC), for the month estimated to be in excess of the reported deficit could also not be realised due to ‘force majeure’ declared by Shell Petroleum Development Company (SPDC) following the break on 48-inch Forcados export line.
According to it, local refining capacity remained below commercial threshold within the month due to prolonged Turn Around Maintenance (TAM) issues, pipeline vandalism, and resultant losses, adding that the three refineries in Port Harcourt; Kaduna; and Warri had a combined operational deficit of N4.69 billion.
“This 11th publication of NNPC monthly financial and operations report indicate a deficit of N26.51 billion as against trading surplus of N274 million reported in May, 2016.
“This trading surplus does not represent net profit as there are other expenses that should ordinarily have been captured. The deficit in the month of June 2016 was majorly due to decrease in revenue generation as a result of decline in PPMC petroleum products sales by 13.30 per cent or N14.9 billion and increase in products distribution costs.
“Also June 2016 operations witnessed the major impact of incessant vandalism, during the month more than 261 vandalised, points were recorded. In NPDC a substantial portion of crude oil sales for the month estimated to be in excess of the deficit could not be realised due to force majeure declared by SPDC as a result of vandalised 48-inch Forcados export line,” said the report.
According to it: “The combined value of output by the three refineries (at import parity price) for the month of June 2016 amounted to N24.68 billion while the associated crude plus freight cost was N22.25 billion, giving a deficit of N4.69 billion after considering overhead of N7.12billion. This deficit for the month was primarily due to irregular crude oil supply and impact of pipeline vandalism.”
It further explained: “In May 2016, crude oil production in Nigeria plummeted to 1.69mb/d following uptick in pipeline vandalism in the volatile Niger-Delta region. Subsisting force majeure at Forcados Terminal means that about 380,000bpd remains shut-in.
“Cargoes were deferred until repairs are completed. Also, the nation has lost over 1,500 megawatts to the damage at Forcados which accounted for 40 to 50 per cent of gas production. Furthermore, force majeure was declared on May 10, 2016, for repair works on Nembe Creek Trunk Line (NCTL) and the resultant shut-in of about 275,000bpd. Other far-reaching incidents include production shut-in at Usan, Que Iboe and Brass Terminals.”
It noted that: “In the downstream sector, introduction of new price regime, especially for Petrol has continued to incentivise the market players to import petrol and relieve NNPC the responsibility of supplying more than 90 per cent of the petroleum products.
“Local refining capacity has remained below commercial threshold due to prolonged Turn Around Maintenance (TAM) issues, pipeline vandalism and resultant losses. However, the ongoing refineries revamp is improving the situation.”
The Nigerian Police Force (NPF) Microfinance Bank Plc has posted a profit before tax of N688 million in the current financial year, while its total assets base stood at 13.67 billion naira.
The Board of Directors of the NPF Microfinance Bank declared the financial results during its yearly general meeting (AGM) in Kaduna, last Thursday, saying that the results for the financial year 2015, showed significant growth in spite of the challenges witnessed in financial operations during the year.
Speaking, the Chairman of NPF micro bank, Retired Deputy Inspector of Police (DIG) Azubuko Joel Udah, stated, “the profit before tax rose by 11 per cent from N617. 5 million in the year 2014 to N688.9 million in 2015”, while “profit after tax similarly rose by seven per cent from N477.8 million in 2014 to N514.6 million in 2015.”
According to him, the total deposit profile of the financial institution for the period ended 31st December, 2015 stood at N6.610 billion, representing a 37 per cent increase over the previous year’s figure of N4.803 billion. Udah also said: “the year 2015 was no doubt a political and economically significant year for Nigeria”, pointing out that “the April general elections, which created so much uncertainty weighted heavily on the economic climate of the country”.
He further explained that the year was significant for the banking sector, “as banks not only had to contend with increasing vulnerability of the oil sector, the pressure on the naira, but also with regulatory head winds chief among which was the implementation of the Treasury Single Account”.
“This affected system liquidity and saw increase in interbank rate to as high as 100 per cent in same period of the year”.These challenges notwithstanding, DIG Udah noted that “the Microfinance sector however continued to witness a more coordinated effort by government and industry players to focus on increasing financial inclusion and ultimately making market work better for the poor with the various CBN and Bank of Industry interventions funds for on-lending to micro, small and medium enterprises attesting to this”.
At a time when the need to boost local production is the talk of the town, local meter manufacturers are gasping for breath as foreign exchange scarcity is taking a toll on their operations, ’FEMI ASU writes
Following the privatisation of the power sector in November 2013, local meter manufacturing firms were buoyed up by the huge metering gap in the country, and invested to ramp up their capacity with the expectation of meeting the demand.
But today, that optimism is being dampened, with a number of them teetering on the brink of collapse as the severe foreign exchange shortage in the country has compounded their problems.
The manufacturers, who rely on importation for some of the components required for the production of meters, complained that it had become very difficult to access forex to order for those inputs.
They also decried the recent benchmark interest rate hike by the Monetary Policy Committee of the Central Bank of Nigeria from 12 per cent to 14 per cent, saying it would further increase the rate at which commercial banks lend to them.
The Managing Director and Chief Executive Officer, Mojec International Limited, a meter manufacturer based in Lagos, Chantelle Abdul, echoed the frustration of the manufacturers, saying, “One of our critical issues at the moment is the lack of access to foreign exchange. A lot of our manufacturing inputs rely on goods abroad. My goal as a manufacturer is to produce as much of my manufacturing input here in Nigeria.”
According to Abdul, some of the components being imported include chips, PCD, which is the brain of the meter, batteries, relays and capacitors.
“There is nothing that stops us from producing the batteries, relays and capacitors that we need. It is sad to say that we don’t even have factories that produce those things here in Nigeria,” she stated.
She said forex scarcity “is posing to be our biggest problem,” as it continued to hamper the ability of the meter manufacturers to import those components.
Financing still remains a big challenge, Abdul said, adding, “We cannot be borrowing at double-digit rate; it will automatically increase the price of the meter.
“Already, Nigerians are struggling to buy the meters, even the electricity distribution companies themselves. So, imagine doubling the price of the meter that already costs between N40,000 and N65,000; it means that we will not be able to bridge the metering gap that already exists in the country.”
Many electricity consumers in the country have continued to groan about the non-provision of prepaid meters by the electricity distribution companies, with complaints about estimated, or what is popularly called “crazy” billing still rampant.
Based on the proposals submitted by the core investors in the Discos during the privatisation of the power firms, 6.52 million new meters are expected to installed over the course of five years, meaning more than one million will be installed yearly.
But the Nigerian Electricity Regulatory Commission, while evaluating the performance of the Discos on the Credited Advance Payment for Metering Initiative recently, said the firms had performed poorly in terms of metering their customers.
As of March 2016, the Discos had collectively metered just 403,255 customers from the time the successor firms of the defunct Power Holding Company of Nigeria were privatised, with about three million currently without prepaid meters.
The Executive Secretary, Electricity Meter Manufacturers Association of Nigeria, Mr. Muyideen Ibrahim, said, “The challenges are really biting harder. We can’t produce as and when due. Forex is not readily available because manufacturers can’t be going to the black market to buy at almost N400 to a dollar.
“As we speak, over N50bn worth of investment from all of the manufacturers is just wasting away, as it were.”
He said aside from forex, poor power supply had been a major problem facing the manufacturers, who, according to him, rely almost completely on generators.
Ibrahim said, “You can imagine the impact of that on the manufacturers’ cost of production. This is making them unable to compete favourably with their foreign counterparts, especially those from China.
“The difference between China and Nigeria is that the Chinese government supports its manufacturers, because they have a good policy framework that is actually working. That is why some of the Chinese companies are saying, ‘We will give some of the Discos meters with one year moratorium before we start collecting money.’ No Nigerian meter manufacturer can do that.”
The EMMAN executive secretary said before the recent Monetary Policy Rate hike, commercial banks were lending to the manufacturers at 22-23 per cent interest rate.
Ibrahim explained, “We have five manufacturers registered with us, and each of them can produce at least 5,000 meters in a month. But now, there are no orders because some of the Discos are not patronising them. So, low patronage is another critical factor affecting the manufacturers.
“In fact, some of them have downsized because they are not producing optimally; their ability to service their loans is being threatened. When you are not producing to capacity, you will fold up eventually if there is no patronage.”
He said the government should give the manufacturers concession with respect to forex and a special intervention fund at a single digit interest rate to enable them to compete with their foreign counterparts.
This, according to Ibrahim, will bring about massive job creation, transfer of technology and contribution to the Gross Domestic Product.
“Another key thing that the government needs to do as a matter of urgency is to liberalise the metering arm of the power sector. There is no enabling law that says it is only the Discos that have the right to buy meters,” he added.
Individuals should be able to buy their meters themselves and take them to the Discos for them to be keyed into the systems before installing them, he noted.
Ibrahim stated, “Now, it is a win-lose situation. The Discos are winning because they have an edge on estimated billing, which is not favourable to the consumers. Whereas there are meters lying fallow in the warehouses of these manufacturers.
“The Discos are not willing to buy the meters, claiming that they don’t have money, and the consumers are suffering.”
The General Manager, Corporate Communications, Eko Electricity Distribution Company, Mr. Godwin Idemudia, told our correspondent that the local meter manufacturers could not meet the requirement of all the electricity distribution companies.
“So, what we are doing in Eko Disco is that we are importing and also patronising local manufacturers, who also rely on importation for some of their components,” he explained.
The Minister of Power, Works and Housing, Mr. Babatunde Fashola, who spoke during a tour of the factory of Mojec International in Lagos on Thursday, stressed the need for increased patronage of local meter manufacturers by the power firms.
“What I have come to verify is why we can have so much capacity to produce as the owners say, a million meters a year, and we still have quite a number of consumers saying that they don’t have meters,” he said.
Fashola, who indicated that the government would not force the power firms to patronise local manufacturers, said commercial issues should be done by persuasion, reason and the dynamics of the economy.
He said, “As the exchange rate begins to play in the real market, it will perhaps make sense to me as a businessman to say, ‘Why should I subject myself to such volatility? Why don’t I purchase locally when there is a big demand for the service; why should I wait seven or 14 days to ship them in?’
“I think we have made progress; it is to see how much more progress we can make. What are the things we can do? Can we find financing to support production and can we tie that to some form of delivery without necessarily burdening the consumers and the customers? Those are the things we will work out.”
Caverton Offshore Support Group Plc, provider of marine, aviation and logistics services to local and international oil and gas companies in Nigeria, last week reported a loss of N2.422 billion for the half year ended June 30, 2016, compared with a profit of N1.093billion in the corresponding.
The company had sent a profit warning saying it would report lower earnings for the H1 of 2016.
According to the company, the lower earnings were being envisaged largely due to the unavoidable impact of the recent Naira devaluation, which took place within the second quarter of the year.
It said the impact of the recent devaluation of Naira by the Central Bank of Nigeria (CBN) was expected to result in unrealised foreign translation loss arising largely from the groups’ dollar denominated borrowing used to finance core assets in both its Helicopter and Marine businesses.
When the H1 results were reported last week, it showed a revenue of N9.143billion in 2016, down from N11.908billion in 2015. Gross profit stood at N3.091billion, down from N5.114billion. Indirect operating (administrative) expenses rose to N5.031billion, compared with N 3.233billion in 2015. Earnings before interest and tax was negative N1.624 billion, compared with a positive N2.582 billion.
Caverton ended the period with loss after tax of N2.432 billion, as against a profit of N1.093 billion.
Despite the loss, the company assured that it would continue to focus on its diversification programme.
“We continue to focus our efforts on diversifying and increasing our revenue streams and also improving our profitability through expansion into higher margin offshore service offerings. Management is confident that its ongoing initiatives and investment across its value chain will provide improved future performance, positioning it for long term success,” the company said.
The company’s fortunes are being affected by the challenges facing its clients in the oil and gas sector due to the decline price of crude oil at the international market. A situation that has made the company embark on diversification of its operations.
Speaking on the strategy, Group Chief Executive Officer of Caverton, Mr. Bode Makanjuola had said: “We are working tirelessly to broaden our service offerings through diversification into other sectors, as well as geographically into newer markets in a bid to boost our non-oil and gas revenues.”
He disclosed that in the first quarter, the company successfully signed a new five-year contract in its helicopter operations to manage and operate a fleet of aircraft for the Lagos State Government.
He disclosed that the company was making steady progress with the construction of their new Maintenance, Repair & Overhaul facility (MRO) at their Ikeja base, adding that the timeline for delivery of the MRO is still on track for end of 2017.
Wapic Insurance Plc, one of the licensed insurance companies in Nigeria, has announced profit before tax (PBT) of N368million in its unaudited financial report for the period ended June 30th,2016.
This represents 238 percent growth in the company’s PBT for the period compared to N109million it achieved in the corresponding period of 2015.
Wapic Insurance, highlighting its other financial performance for the period under review, said its Gross Written Premium grew N4.5billion, showing 12 percent rise from the corresponding period in 2015.
The company, however, said its Underwriting Profit went down by 68 percent to stand at N267million for the period, a situation which it blamed on increased claims expenses experienced by the company for the period.
According to other financial highlights released to the public by the company; total claims paid by the company for the period stood at N1.22billion, representing 110 percent increase from the corresponding period figure in 2015, just as the company’s Gross claims ratio experience for the period increased by 27 percent compared to what it was in 2015.
Similarly, its subsidiary, Wapic Insurance Life within the same period increased its Grossed Premium by 40 percent to close at N947million, in the period under review, an achievement which the company’s management attributed to successful prioritisation of the group life products.
Underwriting Profit however went down by 137percent to a loss of N63million, against N169million recordedin the corresponding period of 2015.
The company made an operating loss of N233million, representing a 231 percent decline from the first half 2015 position.
The management explained that this was a result of the increased claims experience for the period especially in the group life product.
“Claims increased by 100 percent, to N306million in first half 2016 from N153million in first half 2015.
The company’s offshore subsidiary, Wapic Insurance, Ghana, within the period under review, recorded Gross Written Premium of N425million, up by 29 percent against 2015 corresponding period figure of N330million.
According to the company, within the period, Underwriting Profit, declined by 126 percent to a loss of -N19million with an operating loss of N282million in the period under review
Total claims paid within the period stood at N236million, representing a 144percent increase from first half 2015 figure.
Commenting on the results, Managing Director WAPIC Insurance Plc., Yinka Adekoya said:“Our half year result reflects our company’s unwavering commitment to its growth objectives. Despite the challenging economic conditions in the first half of the year, the Group’s gross premiums grew by 12 percent to N4.5billion and recorded pre-tax profits of N368million , showing 238 increase from last year’s figure.”
Continuing , he said: “As an organisation, we are focused on strengthening our sales activities by delivering on our customer experience promises, leveraging on our priority products, improving cost optimisation and articulating our brand. We remain committed to deepening retail channels and achieving growth targets for the second half of the year.”
He said at the International level, Wapic Insurance is a company of no mean repute having clinched AM Best financial strength rating (FSR): of B- in risk rating category and Issuer Credit Rating (ICR): of bb-.
Meanwhile, the company said it will hold a teleconference call for investors and analysts on tomorrow (August 9), at 2pm Lagos Time (1pm London/ 3pm Johannesburg/ 9am NewYork) with its senior management, to announce the unaudited financial results for the period ended June 30th, 2016. It added: “There will be an opportunity at the end of the call for management to take questions from investors and analysts.”
Nigeria’s sugar producer, Dangote Sugar Refinery, has announced a profit before tax of N11.1bn for the six months ended June 30, 2016.
According to a statement from the firm, the unaudited results for the half year indicated that all performance measurement indices trended upwards, adding that profit before tax rose by 13.3 per cent compared to N9.8bn in the same period in 2015.
The statement read in part, “The sugar group recorded a profit after tax of N7.4bn, which rose by 17.5 per cent over N6.3bn posted in the corresponding period in 2015.
“Group revenue increased by 37.86 per cent to 70.5bn compared to 51.1bn in 2015, reflecting the increase in sales volumes during the period.
“Gross profit increased by 9.57 per cent to N13.9bn in contrast to N12.7bn despite higher production costs.”
The statement quoted the Acting Group Managing Director of the company, Abdullahi Sule, as saying that despite market challenges experienced in the first quarter and operating challenges in the second quarter of 2015, the firm was able to grow its revenue compared to the same period in the previous year.
He said, “Our focus for the remainder of the year will be to increase sugar production at reduced conversion cost and improve distribution to match the increasing demand from our customers.”
