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Aero Lays Off 60% of Workforce

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Aero Contractors Airlines
  • Aero Lays Off 60% of Workforce

Aero Contractors Nigeria Limited has issued letters of redundancy to about 60 per cent of its total workforce.

The airline said it had been grappling with huge and unrealistic personnel costs as well as other operational challenges worsened by lack of enough aircraft to keep all the workers meaningfully engaged.

Aero said in a statement issued on Thursday that the issuance of notification of redundancy was a business decision that would ensure its survival.

“The current situation where over 1,000 people are basically not engaged due to lack of serviceable aircraft is not sustainable for the airline. The huge monthly salaries associated with a bloated workforce will eventually kill the airline, which is not the intention of the current government,” the airline said in the statement.

It stated that it currently had aircraft-to-employee ratio of 1:500, adding that this was perhaps the worst in the history of the global airline industry.

“Government’s intervention in Aero was to save it from total collapse, therefore, all steps such as this (issuance of redundancy letters, are to ensure that its survival must be put into consideration to save the airline,” it added.

This decision, the statement explained, would immediately reduce the operational cost, enable the management bring in more aircraft through savings from overheads, pay for C-checks as well as enable Aero to have a more manageable and committed workforce in line with international best practices of 50 to 60 personnel to one aircraft unlike what obtained at the moment.

The airline, however, added that those in maintenance repair and overhaul, as well as other essential staff in critical departments would not be affected by the notification.

It stated that the Chief Executive Officer, Aero, Capt. Ado Sanusi, and his management team had also ensured that the affected workers would be able to access their full gratuities as well as a part of their pension.

“They also stand a chance of being recalled as soon as Aero increases the number of aircraft in its fleet in the near future,” the statement added.

It stated that before taking this decision, the management of Aero consistently explained the inevitability of redundancy declaration to both the workers and the unions, because there was no way the airline could carry on with its bloated personnel and huge overhead costs.

The redundancy letter read in parts, “Following the operational challenges of Aero, culminating in (the) loss of business opportunities that adversely affected company finances vis-à-vis operations, we are constrained to place you under redundancy pending a possible future review. This decision was communicated to the unions where their understanding was solicited in view of prevailing operational difficulties.

“Whilst Aero appreciates your contribution to the company and continues to regard you as worthy ambassadors, we solicit your understanding as we struggle to stabilise operations and rebuild the company.”

Aero also assured its customers that the exercise would in not affect its operations, but that it would rather enhance safety, reliability and efficiency.

While reacting to the development, the President, Air Transport Services Senior Staff Association of Nigeria, Ahmadu Ilitrus, said the notice of redundancy to Aero workers was unacceptable to the body, adding that a meeting to discuss the airline’s issues had been scheduled for Friday.

Ilitrus said the union had advised the workers not to accept any letter from the management.

“We are not against redundancy but what we are saying is that before you sack them, there must be money to pay them and I know Aero does not have the money to pay them. They went ahead to hold meetings with our branch members, but we have told them that the matter has gone beyond the branch,” he said.

He said the process of redundancy ought to have been declared in October 2016 but a meeting was held last month to review the progress made, adding that the management of Aero pleaded for time to work things out in order to commence the process.

Ilitrus said the management of the airline should not give room for industrial unrest as the entitlements of all the affected workers must be ready at the point of the collection of their letters.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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MicroStrategy Rally Crushes Short Sellers, Wiping Out $1.92 Billion

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MicroStrategy- Investors King

Short sellers betting against MicroStrategy found themselves facing significant losses as the company’s rally wiped out $1.92 billion since March.

This development comes amidst a rally that has seen MicroStrategy’s stock outperform bitcoin, causing a considerable hit to those who had taken a bearish stance on the tech firm.

According to data from S3 Partners, short sellers have been on the losing end since March, as MicroStrategy’s stock surged, highlighting the impact of the rally on those betting against the company’s success.

This loss underscores the challenges faced by short sellers in a market where certain stocks experience rapid and unexpected price increases.

The rally in MicroStrategy’s stock is attributed to several factors, including the approval of several spot bitcoin exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC) earlier in the year.

This move by the SEC brought bitcoin, a once-nascent asset class, closer to the mainstream and fueled investor interest in companies like MicroStrategy, known for their significant holdings of the cryptocurrency.

MicroStrategy, which held nearly 190,000 bitcoin on its balance sheet as of the end of 2023, has indicated its intention to continue increasing its exposure to the digital currency.

The company’s decision to sell convertible debt to raise money for additional bitcoin purchases further bolstered investor confidence and contributed to the stock’s rally.

Analysts at BTIG noted that the premium for MicroStrategy’s stock reflects investors’ desire to gain exposure to bitcoin indirectly, especially those who may not have the means to invest directly in the cryptocurrency or ETFs.

The company’s ability to raise capital for bitcoin purchases is seen as a positive sign for shareholders, adding to the optimism surrounding its stock.

However, despite the recent rally and optimism surrounding MicroStrategy, the crypto industry as a whole continues to be heavily shorted.

Short interest in nine of the most-watched companies in the crypto space remains high, standing at 16.73% of the total number of outstanding shares, more than three times the average in the United States.

Moreover, concerns persist regarding the SEC’s stance on cryptocurrencies, with some experts suggesting that the approval of spot bitcoin ETFs may not necessarily indicate a broader acceptance of other similar products, such as spot ethereum ETFs.

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Geregu Power Plc Announces N14.46bn Profit in Q1 2024

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Geregu Power Plc

Geregu Power Plc has announced a profit of N14.46 billion for the first quarter (Q1) of 2024.

This represents a 307% increase when compared to the same period last year.

The power-generating company, known for its pivotal role in Nigeria’s energy sector, disclosed its outstanding financial results in its interim financial statement filed with the Nigerian Exchange Limited on Tuesday.

This disclosure comes shortly after the firm’s Deputy Chief Executive, Julius Omodayo-Owotuga, hinted at the promising financial outlook during the company’s recent annual general meeting held in Lagos.

According to the interim report, Geregu Power Plc’s revenue surged to N50.42 billion in the first quarter of 2024, representing an increase of 254.37% year-on-year appreciation.

The company’s net finance income transitioned from a negative position to N133.61 million. This positive momentum was supported by a moderation in finance costs, which decreased from N3.141 billion to N2.29 billion as of March 2024.

Speaking to stakeholders at the recent annual general meeting, Femi Otedola, Chairman of Geregu Power, expressed satisfaction with the company’s exceptional financial performance in 2023.

Otedola highlighted the board’s decision to propose a dividend distribution of N8 per share for the 2023 financial year as a testament to their commitment to rewarding shareholders and confidence in the company’s future prospects.

The robust financial results for the first quarter of 2024 further solidify Geregu Power’s position as a leading player in Nigeria’s energy landscape.

The company’s commitment to operational excellence, strategic investments, and adherence to international standards, such as obtaining ISO 9001 and 14001 certifications from the Standard Organisation of Nigeria, underscores its dedication to driving sustainable growth and value creation.

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Guaranty Trust Holding Company Plc Records N609.3bn Profit Before Tax in 2023

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GTCO Commemorates Listing on Nigerian Exchange - Investors King

Guaranty Trust Holding Company Plc (GTCO) has announced a strong profit before tax (PBT) of N609.3 billion for the 2023 financial year.

This represents an increase of 184.5 percent when compared to the previous year.

The audited consolidated and separate financial statements filed with the Nigerian Exchange Group and London Stock Exchange on Monday revealed market capitalization exceeded N1 trillion on the NGX to further solidify GTCO’s position as one of the top financial holding companies in Nigeria.

During the period under review, the group’s post-tax profit rose by 218.99 percent to N539.65 billion from N169.17 billion in 2022.

Key indicators such as loans and advances increased by 31.5 percent to N2.48 trillion, while deposits grew by 63.7 percent to N7.55 trillion.

The group’s total assets and shareholders’ funds closed at N9.7 trillion and N1.5 trillion, respectively.

Despite the challenging economic environment, GTCO maintained a strong capital adequacy ratio of 21.9 percent.

Also, the group sustained asset quality, with IFRS 9 Stage 3 loans improving to 4.2 percent in December 2023 from 5.2 percent in the same period of the prior year.

However, the cost of risk experienced an uptick, rising to 4.5 percent from 0.6 percent in December 2022, largely due to worsening macroeconomic factors.

Despite these challenges, GTCO’s pre-tax return on equity stood at 50.6 percent, while pre-tax return on assets was 7.6 percent. The cost-to-income ratio remained favorable at 29.1 percent.

Commenting on the financial results, Mr. Segun Agbaje, the Group Chief Executive Officer of GTCO, expressed satisfaction with the company’s performance amidst a challenging operating environment.

He attributed the strong performance to the successful implementation of the group’s business model across banking and non-banking business verticals.

“Also important to our success is our relentless obsession with innovation and offering great customer experiences as demonstrated by the successful redesign and upgrade of our mobile banking application, GTWorld,” he stated.

“In a landscape characterised by evolving regulatory reforms, global uncertainties, and heightened competition, we have continued to leverage our inherent strengths and capabilities to unlock significant value, creating more opportunities for the businesses and individuals we serve.

In line with its commitment to shareholders, GTCO announced a final dividend of N2.70k, bringing the total dividend for 2023 to N3.20k.

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