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Dangote Cement, Access Bank, Zenith Bank Top Trades

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Nigerian Exchange Limited - Investors King
  • Dangote Cement, Access Bank, Zenith Bank Top Trades

Dangote Cement Plc, Access Bank Plc and Zenith International Bank Plc emerged as the top three equities (measured by volume) traded on the Nigerian Stock Exchange last week.

The companies accounted for 833.966 million shares worth N95.969bn in 3,203 deals, contributing 33.12 per cent and 84.10 per cent to the total equity turnover volume and value, respectively.

A total turnover of 2.518 billion shares worth N114.117bn in 23,546 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 2.211 billion shares valued at N30.636bn that exchanged hands penultimate week in 26,287 deals.

The financial services industry (measured by volume) led the activity chart with 1.507 billion shares valued at N16.354bn traded in 12,511 deals; thus contributing 59.85 per cent and 14.33 per cent to the total equity turnover volume and value, respectively.

The industrial goods industry followed with 441.914 million shares worth N89.356m in 1,282 deals. The third place was occupied by the conglomerates industry with a turnover of 184.608 million shares worth N701.665m in 929 deals.

Exchange-traded products during the week stood at 1.166 million units of ETPs valued at N16.169m executed in 17 deals compared with a total of 1.732 million units valued at N13.711m transacted the penultimate week in 19 deals.

A total of 5,850 units of Federal Government bonds valued at N5.702m were traded last week in seven deals, compared with a total of 750 units valued at N695,229.29 transacted in the penultimate week in eight deals.

The NSE All-Share Index and market capitalisation appreciated by 1.52 per cent and 1.53 per cent to close the week at37,425.15 and N12.899tn, respectively.

Similarly, all other indices finished higher during last week with the exception of the NSE banking and the NSE oil/gas index that depreciated by 1.64 per cent and 3.05 per cent, respectively, while the NSE ASeM index closed flat.

Thirty-eight equities appreciated in price during last week, lower than 51 equities of the previous week. Twenty-eight equities depreciated in price, higher than 23 equities of the previous week, while 105 equities remained unchanged higher than 97 equities recorded in the preceding week.

The market remained awash with buy sentiments as investors continued to take positions in companies that released impressive financial scorecards in the past weeks. In the coming week, “we expect market’s performance to be dictated by activities of banking sector stocks as investors anticipate the release of the half-year results and interim dividend declaration by the Tier 1 banks,” analysts at Meristem Securities said.

The naira appreciated by 0.36 per cent week-on-week in the interbank forex market to close at N305.55/dollar. However, in the parallel FX market, it traded flat closing the week at N365/dollar. On Wednesday, the Central Bank of Nigeria held a Treasury Bills Primary Market Auction where instruments worth N229.143bn were issued.

All instruments offered were oversubscribed, and were issued at stop rates of 13.4220 per cent (91-day), 17.4000 per cent (182-day) and 18.5300 per cent(364-day). B

Bearish sentiments prevailed in the Treasury bills secondary market as the average yield advanced by 0.11 per cent to close the week at 18.87 per cent.

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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Banking Sector

Adaora Umeoji Highlights Zenith Bank’s Robust Financial Metrics: Says Bank is Poised to Cross The N1 Trillion Mark in Profit in 2024

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Adaora Umeoji

Zenith Bank Plc, Nigeria’s leading financial institution, held its Capital Markets Day last week to showcase the bank’s inherent values as it embarks on its recapitalisation journey.

The event, which brought together key market players, focused on the bank’s growth trajectory, strategic objectives, market performance, and consistent, robust dividend payout over the years.

It also provided an opportunity for the bank to inform capital market stakeholders about its robust risk management culture, adherence to regulations, capital adequacy, and maintenance of low non-performing loan levels.

Addressing capital market stakeholders, investors, and analysts at the event in Lagos, the Group Managing Director/Chief Executive Officer, Dame Dr Adaora Umeoji, highlighted the financial institution’s tier-1 capital of N1.8 trillion, shareholders’ funds of N2.3 trillion, market capitalisation of N1.3 trillion, a profit before tax of N796 billion, and a dividend of N4 per share for the year ended December 2023.

Providing guidance for 2024, she noted that, given the trend of the bank’s performance and having achieved a profit before tax of N796 billion in 2023 and N320 billion in the first quarter of 2024, the bank is on track to deliver over N1 trillion in profit before tax in 2024.

She expressed confidence that, with the quality of the board and management and a strong corporate culture, the bank is well-positioned to deliver superior value to investors and other stakeholders and to navigate the recapitalisation process successfully.

She also disclosed some of the bank’s future plans, which include driving financial inclusion, expanding corporate and retail banking through technology and other state-of-the-art digital platforms, and establishing a fintech subsidiary, ZenPay, to drive profitability.

Also, the bank intends to expand to France and other Francophone African countries.

Dr Umeoji explained, “For us at Zenith, we won’t be left out. We are planning to go to the market to raise capital, and as it stands, Zenith Bank has the least amount of capital to raise. We are looking to raise N230 billion because we are already at N270.7 billion.

That is the least capital to raise among our peers. We believe that Zenith Bank has what it takes. We have the capacity, the network, the balance sheet, the human capital, and the track record to achieve that.

We are planning for the future, and the technology we have now is the best in the entire industry. It will help us to have a seamless process and integrate.”

Also speaking, the Chief Financial Officer/General Manager, Dr Mukhtar Adam, pointed out that in the last five years, the bank’s Compound Annual Growth Rate (CAGR) in revenue has grown by over 27 per cent.

“This continues to grow year-on-year. Within this period, at some point, Nigeria went into recession, but we forged ahead, worked very hard, and continued to deliver growth. Within the last five years, our profit before tax has also grown cumulatively by about 28 per cent. This is a market where, at some point, government instruments – treasury bills – were paying one per cent, two per cent, three per cent. But we forged ahead to grow the numbers and provide stable returns of at least 28 per cent.”

Zenith Bank recently emerged as the Best Commercial Bank, Nigeria, in the World Finance Banking Awards 2024, retaining the award for the fourth consecutive year.

The bank was also named Best Corporate Governance, Nigeria, for the third year running in the World Finance Corporate Governance Awards 2024.

The awards, published in the Summer 2024 issue of World Finance Magazine, recognise the bank’s robust financial performance, superior customer service, sustainability initiatives, and corporate governance practices.

Commenting on the dual honours, Dr. Umeoji said, “These awards highlight our steadfast dedication to excellence, adherence to global best practices, and our persistent effort to deliver superior value to all stakeholders through innovative products and services. Receiving these awards consecutively for multiple years signifies the commitment of our staff, the loyalty of our customers, and the support of our shareholders. We remain devoted to setting industry benchmarks and driving excellence across all aspects of our operations.”

Dr. Umeoji also expressed delight at the recognition and dedicated the awards to the Founder and Chairman, Dr. Jim Ovia, CFR, for his impactful leadership in establishing a robust and flourishing institution.

She also expressed gratitude to the board for their vision and insight, the staff for their unwavering dedication, and the bank’s customers for choosing Zenith as their preferred bank. World Finance is a leading international magazine providing comprehensive coverage and analysis of the financial industry, international business, and the global economy.

In its audited results for the year ended December 31, 2023, Zenith Bank achieved a remarkable triple-digit growth of 125 per cent in gross earnings, from N945.6 billion reported in 2022 to N2.132 trillion in 2023.

The impressive growth in gross earnings resulted in a year-on-year increase of 180 per cent in profit before tax (PBT), from N284.7 billion in 2022 to N796 billion in 2023, while profit after tax (PAT) also recorded triple-digit growth of 202 per cent, from N223.9 billion to N676.9 billion for the period ended December 31, 2023.

The increase in gross earnings was primarily due to growth in interest and non-interest income. Specifically, its interest income increased by 112 per cent, from N540 billion in 2022 to N1.1 trillion in 2023, while non-interest income grew by 141 per cent, from N381 billion to N918.9 billion in the same period.

The rise in interest income was attributed to the growth in the size of risk assets and their effective repricing, alongside the increase in yield of other interest-bearing instruments over the year. Growth in non-interest income was driven by significant trading gains and an increase in gains from the revaluation of foreign currencies.

Zenith Bank’s cost of funds also grew from 1.9 per cent in 2022 to three per cent in 2023 due to the high interest rate environment, while interest expense increased by 135 per cent, from N173.5 billion in 2022 to N408.5 billion in 2023.

Notwithstanding the 32 per cent growth in operating expenses in 2023, the Group’s cost-to-income ratio improved significantly from 54.4 per cent in 2022 to 36.1 per cent in 2023 due to improved top-line performance.

Return on Average Equity (ROAE) increased by 118 per cent, from 16.8 per cent in 2022 to 36.6 per cent in 2023, underpinned by improved gross earnings, as the Group sought to deliver better shareholder returns. Return on Average Assets (ROAA) also grew by 95 per cent, from 2.1 per cent to 4.1 per cent in the same period.

Zenith Bank was established in May 1990 and commenced operations in July of the same year as a commercial bank.

The bank became a public limited company on June 17, 2004, and was listed on the Nigerian Stock Exchange (NSE) on October 21, 2004, following a highly successful Initial Public Offering (IPO). In 2013, the bank listed $850 million worth of its shares at $6.80 each on the London Stock Exchange (LSE).

Headquartered in Lagos, Nigeria, Zenith Bank Plc has more than 400 branches and business offices in prime commercial centres across all states of the federation and the Federal Capital Territory (FCT).

Zenith Bank Plc, founded by Jim Ovia, CFR, in 1990, has since grown to become one of the leading financial institutions in Africa. The underlying philosophy is for the bank to remain a customer-centric institution with a clear understanding of its market and environment.

Zenith Bank’s track record of excellent performance has continued to earn the brand numerous awards.

These latest accolades follow several recognitions, including being recognised as the Number One Bank in Nigeria by Tier-1 Capital for the 14th consecutive year in the 2023 Top 1000 World Banks Ranking, published by The Banker Magazine; Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards for 2020 and 2022; and Most Sustainable Bank, Nigeria, in the International Banker 2024 Banking Awards, among several others.

Zenith Bank Plc has blazed the trail in digital banking in Nigeria, achieving several firsts in the deployment of Information and Communication Technology (ICT) infrastructure to create innovative products that meet the needs of its customers.

The bank is a leader in the deployment of various channels of banking technology, and the Zenith brand has become synonymous with state-of-the-art technologies in banking.

Driven by a culture of excellence and strict adherence to global best practices, the bank has combined vision, skilful banking expertise, and cutting-edge technology to create products and services that anticipate and meet customers’ expectations, enable businesses to thrive, and grow wealth for customers.

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Insurance

Cornerstone Insurance PLC Announces Delay in Filing Q2 2024 Financial Statements

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Cornerstone Insurance PLC, a prominent player in Nigeria’s insurance sector, has informed shareholders and stakeholders about a delay in filing its Unaudited Financial Statements for the second quarter (Q2) of 2024.

This delay, as disclosed by the company, stems from unforeseen challenges related to the implementation of the International Financial Reporting Standards (IFRS) 17.

The company, in a statement released today, cited that the introduction of IFRS 17 Accounting Standards necessitated significant changes in reporting methods.

These changes, in turn, disrupted the audit process and consequently delayed the preparation of the Q2 Unaudited Accounts.

Cornerstone Insurance PLC’s Audited Accounts and Financial Statements for the year ended December 31st, 2023, have already been filed and approved by the regulatory bodies.

However, the transition to IFRS 17 has posed unexpected hurdles, causing setbacks in the timely preparation of subsequent financial reports.

In response to the delay, Cornerstone Insurance PLC has sought and obtained approval from the Nigerian Exchange Limited (NGX) to extend the deadline for filing its Q2 Unaudited Financial Statements.

The company expressed regret over the inconvenience caused by this delay but assured stakeholders of its commitment to ensuring the submission and publication of the Q2 Financial Statements by August 31st, 2024.

The delay announcement comes amid efforts by regulatory authorities to enhance financial reporting standards across Nigeria’s corporate landscape.

Cornerstone Insurance PLC remains dedicated to meeting regulatory obligations while maintaining transparency and accountability in its financial disclosures.

Investors and stakeholders are advised to monitor further updates from Cornerstone Insurance PLC as the company works diligently to finalize its Q2 2024 financial reporting process.

For more information and updates, shareholders can visit Cornerstone Insurance PLC’s official website or contact the company’s investor relations department directly.

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Banking Sector

Guaranty Trust Holding Company Plc Offers 9 Billion New Ordinary Shares

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GTBank -Investors King

Guaranty Trust Holding Company Plc (GTCO) has announced a new offering of 9,000,000,000 ordinary shares of 50 kobo each.

This strategic move aims to recapitalize its Nigerian banking subsidiary and expand the group’s footprint in the pension fund administration and asset management sectors.

Details of the Offering:

Issuer: Guaranty Trust Holding Company Plc
Lead Issuing House: Stanbic IBTC Capital Limited
Joint Issuing Houses: Absa Capital Markets Nigeria Limited, FCMB Capital Markets Limited, and Vetiva Advisory Services Limited
Offer Price: ₦44.50 per Offer Share
Total Share Capital: ₦14,715,589,612, divided into 29,431,179,224 ordinary shares of 50 kobo each

Purpose of the Offering:

After deducting the costs and expenses of the offer, estimated at ₦8,010,000,000 (2% of gross proceeds), the net proceeds of ₦392,490,000,000 will be allocated as follows:

  1. Recapitalisation of GTBank Nigeria: ₦370 billion (94.3% of net proceeds) with an estimated completion period of six months.
  2. Growth and Expansion of the Group: ₦22.49 billion (5.7% of net proceeds) for acquisitions in pension fund administration and asset management businesses, with an estimated completion period of 24 months.

Offer Structure and Allocation:

The offer, structured as an Offer for Subscription, will be split equally between institutional investors and retail investors, with each group allocated 4,500,000,000 shares. The issuer retains the right to adjust this allocation based on demand from each investor class.

Key Dates:

  • Opening Date: Monday, 15 July 2024
  • Closing Date: Monday, 12 August 2024

Subscription and Payment:

The minimum subscription is set at 100 Offer Shares, with multiples of 10 thereafter. Payment is required in full upon application.

Market Capitalisation:

  • Pre-Offer Market Capitalisation: ₦1,309,687,475,468
  • Post-Offer Market Capitalisation (assuming full subscription): ₦1,710,187,475,468

Listing and Quotation:

GTCO’s entire issued and paid-up share capital is listed on the Nigerian Exchange (NGX). An application has been submitted to the NGX Board for the listing of the new shares.

Allotment and Status:

The new ordinary shares will rank equally with the existing shares. The allotment will follow SEC rules, ensuring all investors receive the minimum application in full, with any remaining balance allotted according to the determined allocation split.

This offering represents a significant step for GTCO in strengthening its financial base and expanding its business operations, reflecting the company’s commitment to sustained growth and value creation for its shareholders.

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