Foreign Investment Inflow in Oil Dips N36bn
Turbulence in the international oil market pushes investment in Nigeria’s petroleum further away, as year on year capital inflow dips by 85.7 per cent.
Data obtained from the National Bureau Statistics, NBS, revealed that foreign investment inflow into the oil sector dropped further by $178.42 million, about N35.684 billion in one year, from December 2014 to December 2015.
Specifically, the NBS in its Capital Importation Report for the Third and Fourth Quarters, Q3 & Q4 2015, pointed out that foreign investment inflow into the sector crashed to $29.78 million, about N5.95 billion as at the end of 2015, compared to $208.18 billion in 2014, representing a decline of 85.7 per cent.
“Further analysis revealed that in Q1 2015, foreign investment inflow into the petroleum industry stood at $9.47 million, compared to $201.14 million in Q1 2014.”
In the second, third and fourth quarters of 2015, capital imported into the oil and gas sector stood at $4.86 million, $2.21 million and $13.22 million respectively, against $3.83 million, $3.16 million and N0.05 million recorded in the corresponding periods of 2014.
In its analysis of capital importation in Q4 2015, NBS noted that in the last few years, a high proportion of the capital imported originated from the United Kingdom, UK, but that this had changed markedly since Q2 2014 when 68.46 per cent of imported capital was from the UK.
Thereafter, the NBS said capital imported from the UK has recorded a quarterly decline, adding that in Q3 & Q4 2015, the quarterly decline was 47.64 per cent and 23.70 per cent respectively.
It further stated that compared to the periods of the previous year, capital imported from the UK had declined by 80.42 per cent in Q3 and 77.85 per cent in Q4.
The NBS said: “As a result of these changes, the UK only accounted for 27.69 per cent of total capital imported in the final quarter of 2015, slightly less than the 27.96 per cent accounted for by the Netherlands.
“In total, between 2014 and 2015, the value of capital imported from the UK fell from $10.938 billion to $3.834 billion, a drop of 64.95 per cent. This fall accounted for 63.96 per cent of the total fall in capital importation between these years.”
It added that despite these trends, the UK and the United States, US, remained the first and second largest providers of capital investment for Nigeria, as they have been each year since 2007.
Unilever Nigeria to Reposition Products For Expansion
A renowned consumer goods manufacturer, Unilever Nigeria Plc has disclosed plans to reposition its products and expand its business for sustainability.
Unilever Nigeria Plc produces and markets consumables that include foods, household, beauty, cleansing amongst other goods, Investors King reports.
In a corporate notice signed by its Secretary, Abidemi Ademola sent to the Nigerian Exchange Limited, the company stated that its home care and skin cleansing markets will cease to exist while a rebranding takes place for increment in profit.
According to the company, the change in its business model became expedient to fast track the organisation’s growth and further satisfy the needs of their customers, employees, shareholders and other stakeholders.
Ademola explained that the new strategy would involve digital measures to simplify the business process while chances of devaluation will be avoided and reduced in the market upgrade.
The company had already visualised the extinction of the home care and skin cleansing categories in 2023 for the general growth of the firm and particularly to build a sustainable business.
The statement read in part, “this will involve repurposing the portfolio by exiting the home care and skin cleansing categories to concentrate on higher growth opportunities.
“Strengthening business operations with measures to digitise and simplify processes; and focusing more on business continuity measures that reduce exposure to devaluation and currency liquidity in our business model.”
NGX: 16 Companies Fined N779m Between 2020 and 2022
No fewer than 16 business firms have been penalised by the Nigerian Exchange Limited (NGX) for market-related offences between 2020 and 2022.
Investors King gathered that the total sum of N779.5 million was imposed as fine on the erring companies that cut across manufacturing, food, insurance, consumer goods, technology, banking industries amongst others.
The penalty was as a result of non-compliance with some of the rules and requirements of the exchange for the timely filing of results and accounts by the company.
The NGX data shows that in 2022, fourteen companies were fined the sum of N170.6 million. They include: ETI, FBN Holdings Plc, Union Bank of Nigeria Plc, Honeywell Flour Mills Plc, Unity Bank Plc, Presco Plc, Ardova Plc, C&I Leasing Plc, Coronation Insurance Plc, Royal Exchange Plc, PZ Cussons Nigeria Plc, LASACO Assurance Plc, Mutual Benefits Assurance Plc and Omatek Ventures Plc.
While in 2021, seven companies were sanctioned N586 million and in 2020, the sum of N22.9 million was imposed as fine on three business firms.
Breakdown of the trade offenses and fines for the companies indicates that Coronation Insurance was fined N14.9 million, C & I Leasing was fined N11.6 million while a fine of 9.7 million was imposed on Ardova in 2022.
The NGX fined Presco N5.1 million, Honeywell Flour Mills N1.2 million for failure to submit third quarter 2021 result and account before the deadline.
For the erring financial companies, in 2022, ETI was sanctioned N3.2m; in 2021, FBN Holdings was fined N8.1m, Union Bank of Nigeria got N1.2m fine, Fidelity Bank Plc was fined N1.6m while Unity Bank Plc was sanctioned N4.2m.
An Information and Communications Technology firm, Omatek Ventures got a fine of N537.2m in 2022 for refusal to present audited results and accounts for 2015–2018 to the investing public.
LASACO Assurance was penalised N29.2m between 2020 and 2022 for not complying with some post-listing requirements. In 2022, N5.3m was levied for failure to submit its 2021 audited financial statement to the investing public, while in 2021, N15.1m was fined for not presenting the audited 2020 result and accounts.
The company was also sanctioned N8.8m in 2020 for failure to submit audited 2019, first quarter 2020 and second quarter 2020 financial results.
Investors King learnt that the sanctions on the listed companies have discouraged investors from trading in their stock due to the huge fines.
Naira Scarcity: Manufacturers Decry 25% Sales Decrease, Urge FG’s Urgent Intervention
Manufacturers Association of Nigeria, MAN has lamented the effect of naira scarcity on its members, saying that sales of manufactured goods dropped by 25 percent.
The association called on the federal government to urgently and permanently put an end to the challenging situation caused by the introduction of new naira notes and its scarcity.
This was contained in a statement signed by the Director-General of the Manufacturers Association of Nigeria, Segun Ajayi-Kadir expressing the plight of manufacturers.
The manufacturers noted that their businesses had been badly hit by the current cash crunch, adding that it affected the turnout of workers which brought about low output and more than 25 percent decrease in income.
Investors King learnt that the Manufacturers Association President, Otunba Francis Meshioye had last month warned against the impending negative effect of the naira scarcity on manufacturers.
He mentioned that the sales of manufactured goods will significantly drop which is presently playing out.
Speaking on digital banking services, the MAN president said online transactions including the use of point of service, POS has not been working effectively thereby making the sales process slow.
Meshioye stated that the nation’s economy has also been negatively impacted which may scare present and potential investors from investing in the country as they are particular about what their resources would yield.
“I want to assume that this is a very short-term problem. It is general. Even if you want to do e-banking, there are some things you cannot do at the moment. We have problems. PoS is not working.
“There is no way the scarcity of something that is essential to the consumer will not affect the producer. We feel it because it hinders the proper flow of our goods to the end user. What effect is that going to have? It means we will pile stock and when we pile stock, it means cash is trapped. We pay high interest rates and they would not yield good returns and investments go to where returns come regularly.
“This is a very big issue in the economy. If you put all these together, you will agree with me that we are really facing a critical time as manufacturers,” he stated.
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