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Naira Appreciates At the Interbank Market

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500 and 1000 naira bills (Nigerian currency)

The Nigerian Naira appreciated against the US dollar at the interbank market on Monday, as investors await the decision of the Monetary Policy Committee on the state of the economy.

The currency improved by 0.5 percent to trade at N307.25 to the dollar, from N308.69 it exchanged on Friday.

It, however, remains unchanged at the Bureau de Change segment, closing at N422 against the dollar, N549 to the pound and N470 against the Euro-single currency.

Trading at the parallel market, the Naira stabilised at N425 against the dollar, a figure it has maintained for three days, while it exchanged against the Pound and Euro at N550 and N470 respectively.

Currency traders hope that the MPC would reconsider its forex policy with a view to rescue the nation’s currency, while attacking unemployment by lowering borrowing cost to boost the manufacturing sector.

“The central bank will have to expand its monetary policy and combine it with realistic fiscal policy to ease economic gridlock, while making non-oil sector priority,” said Samed Olukoya, a Foreign Exchange Research Analyst at Investors King Ltd.

“Considering global oil glut, increasing oil production won’t help the nation recover from economic recession, but pushing through with diversification will help create jobs, fight importation and encourage youth participation, since they are the most unemployed going by NBS report,” he added.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Finance

BUA Cement, GTCO, United Bank for Africa Pay N14.3 Billion in Company Income Tax in Q3 2021

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Company Income Tax (CIT) - Investors King

Three of Nigeria’s leading corporations have revealed that they paid a combined N14,273,553,510 in Company Income Tax (CIT) in the three months ended September 30, 2021.

BUA Cement Plc, Guaranty Trust Holding Company Plc and the United Bank for Africa Plc were the listed corporations that announced via their various unaudited financial statements released this week how much that paid in the third quarter (Q3) and the year to date.

Nigeria’s Company Income Tax (CIT) rate is 30 percent for large corporations, firms with gross turnover greater than N100 million, and it is assessed on a preceding year basis – tax is charged on profits for the accounting year ending in the year preceding assessment.

Breaking down the numbers, BUA Cement paid N2.256 billion in the third quarter of 2021, an increase of 48.78 percent from N1.516 billion paid in the same quarter of 2020. The company posted a profit before tax of N24.766 billion for the quarter under review.

However, because the amount paid (or estimated to be paid) is below 30 percent stipulated in the nation’s tax law, a better explanation for the uncaptured amount, which Investors King estimated at N5.174 billion, would be the tax credit Federal Government offered BUA Cement during the period.

United Bank for Africa Plc (UBA) paid N3.152 billion in CIT in the quarter under review. A 481.5 percent jump from N542 million paid in the corresponding quarter of 2020. The leading bank realised N47.166 billion profit before tax in Q3 2021. Also, the amount captured does not include tax credit.

Guaranty Trust Holding Company Plc (GTCO Plc) paid the most CIT at N8.866 billion. GTCO Plc grew profit before tax from N57.638 billion in Q3 2020 to N58.852 billion in Q3 2021. Again, the amount paid does not reflect tax exemption.

This brings the total amount paid by the three leading corporations to N14.274 billion.

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Banking Sector

Guaranty Trust Holding Company (GTCO): Profit After Tax Inches Slightly Higher in Q3 2021

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GTCO Commemorates Listing on Nigerian Exchange - Investors King

Guaranty Trust Holding Company (GTCO Plc), Nigeria’s leading financial institution, grew profit after tax by 4.11 percent to N49.986 billion in the three months ended September 30, 2021.

This was slightly higher than the N48.012 billion filed in the third quarter (Q3) of 2020, according to the bank’s unaudited financial statements released on Tuesday and obtained by Investors King.

The lender’s interest income drops by 7.48 percent to N68.945 billion in the third quarter under review, down from N74.518 billion achieved in Q3 2020.

Interest expense inched slightly higher to N13.057 billion in Q3 2021, representing an increase of 5.3 percent when compared to N12.397 billion filed in the same period of 2020.

As expected, GTCO’s net interest income moderated by 10.03 percent from N62.121 billion in Q3 2020 to N55.887 billion in Q3 2021.

Net interest income after loan impairment charges stood at N54.608 billion in Q3 2021, a decline of 7.04 percent from N58.745 billion recorded in Q3 20210.

However, GTCO was able to plug further decline with a 67.39 percent increase in fee and commission income. The bank realised N18.318 billion in fee and commission income in Q3 2021, up from N10.944 billion charged in Q3 2020.

Fee and commission expense increased slightly to N3.343 billion in the quarter under review, up from N2.239 billion in Q3 2020.

The bank grew net fee and commission income by 72.07 percent to N14.976 billion in Q3 2021 from N8.704 billion achieved in Q3 2020.

Also, the bank’s net gains on financial instruments classified as held for trading dipped slightly to N8.048 billion in Q3 2021. While other income improved from N11.157 billion in Q3 2020 to N15.283 billion in Q3 2021.

Profit before income tax grew slightly by 2.11 percent to N58.852 billion in Q3 2021 from N57.638 billion in Q3 2020. The bank paid N8.866 billion in taxes in the period under review.

GTCO loses N9.491 billion to forex differential in the third quarter but also made N2.847 billion due to forex differential to take its total comprehensive income for the quarter N44.618 billion.

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Finance

BUA Cement Grows Profit After Tax by 20 Percent to N22.5 Billion in Q3 2021

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Bua cement - Investors King

BUA Cement Plc, one of Nigeria’s leading cement manufacturers, grew profit after tax by 20.06 percent to N22.510 billion in the third quarter (Q3) ended September 30, 2021.

This represents a 20.06 percent or N3.762 billion growth from N18.747 billion recorded in the third quarter of 2020.

In the company’s unaudited financial statements released on Tuesday and obtained by Investors King, revenue grew by 13.27 percent to N62.627 billion in the quarter under review, up from N55.288 billion achieved in the corresponding quarter of 2020.

As expected, cost of sales inched higher to N33.497 billion in Q3 2021, a 8.9 percent increase from N30.751 billion achieved in Q3 2020.

Gross profit stood at N29.130 billion while operating profit improved by 16.79 percent to N25.168 billion in the quarter under review from N21.548 billion filed in the same quarter of 2021.

BUA Cement’s net finance costs improved tremendously to N225.047 million in Q3 2021 from N1.229 billion posted in the same period of 2020.

Profit before income tax appreciated by 22.22 percent N20.264 billion in Q3 2020 to N24.766 billion in Q3 2021. The leading cement manufacturer paid N2.256 billion in income tax in the period under review.

Earnings per share grew from 55 kobo in Q3 2020 to 66 kobo Q3 2021.

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