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19 Firms Shut, 250,000 Jobs Threatened by WEMPCO Crisis

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  • 19 Firms Shut, 250,000 Jobs Threatened by WEMPCO Crisis

The current crisis facing the Western Metal Products Company has led to the closure of no fewer than 19 enamelware firms, while 250,000 jobs along the steel and enamelware value chain are also about to end, investigations by our correspondent have revealed.

WEMPCO is reportedly facing a huge debt burden of over N90bn, planning to sell its flagship five-star Oriental Hotel on the island and considering exiting Nigeria.

This may mean the end of its 700,000 tonnes-capacity steel plant.

Our correspondent gathered that the 40-year-old firm was the authorised sole distributor of cold-rolled iron sheet, used in the manufacturing of roofing sheets and annealed iron sheets used in the manufacturing of enamelware.

The Central Bank of Nigeria, in order to protect the local manufacturers, had included cold rolled iron sheet and annealed in the list of 41 banned items from access to official foreign exchange.

The implication is that all the firms that produce roofing sheets and enamelware in Nigeria may have to shut down in the event of WEMPCO’s exit.

Already, all the firms manufacturing wheelbarrows and shovels are said to have shut down while others are winding down gradually having run out of stock of raw materials.

It was gathered that WEMPCO’s trouble stemmed from the influx of substandard roofing sheets smuggled into Nigeria from Cameroon and other neighbouring countries.

The local firms were said to have been mandated by the Standards Organisation of Nigeria to keep the standard of roofing sheet at 0.015mm in thickness.

This posed competition challenge against smuggled roofing sheets which were 0.013mm and 0.014mm.

The smuggled versions were also said to be preferred by buyers because they were cheaper.

Low patronage set in for WEMPCO and its stock of unsold products went bad from staying too long in storage.

By last year, the company had closed down almost all its plants as they were no longer producing.

Our correspondent also spoke to some of the buyers of WEMPCO products who recounted a different version of the story.

All of them, who spoke on condition of anonymity, said the firm was not consistent in filling orders.

It was alleged that they either took too long in delivering the product or delivered items different from the specification.

WEMPCO was also alleged to have abused the exclusive rights and waivers that were granted to it by the Federal Government.

Our correspondent learnt that whereas the previous government had granted the firm heavy waivers to aid it in production of cold-rolled sheet locally, the firm had instead embarked on heavy importation of the product.

Trouble started for it when the current administration came into power and decided to cancel the waivers.

It then became a Herculean task for WEMPCO to fill orders as the importation route had been closed and they could not produce to meet local demand.

Customers, who paid money into WEMPCO account, neither saw their money nor the goods they paid for. The bank held onto customers’ money because WEMPCO was heavily indebted to the bank, it was alleged.

When our correspondent sought an audience with Robert Tung, the Managing Director of WEMPCO, he declined the calls and did not respond to text messages sent to his line.

Our correspondent put a call through to a consultant to the firm, Jide Mike, but he denied ever working for WEMPCO; he also said he knew nothing about the company.

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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Guinness Nigeria Returns to Profitability For the Quarter Ended September 2021

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Guinness - Investors King

The financial results of Guinness Nigeria for the quarter ended September 2021 show a return to profitability for the Beverages Giant during the period compared to a loss made in the prior period.

This return to profitability was driven by a huge jump in revenue from N30 Billion in the same quarter of 2020 to N47.4 Billion in 2021, although the cost of sales also increased from N23 Billion 2020 to N32.2 Billion filed in 2021 thereby giving an increase in gross profit from N7 Billion in 2020 to N15.2 Billion in the quarter under review

Guinness Nigeria increased its marketing and distribution expenses during the period, marketing and distribution expenses rose from N4.6 Billion in 2020 to N6.5 Billion in 2021. This led to a huge jump in Operating profit for the period, operating profit jumped from just N586 Million in 2020 to N6.5 Billion in 2021. This culminated in profit for the period rising to N4 Billion from a loss of N841 Million posted in 2020.

The Chairman, Board of Directors of Guinness Nigeria Plc, Dr. Omobola Johnson maintained that the Company will keep up with its growth strategy to continue on its path of profitability. He said “We are confident that our strategy is comprehensive and robust. We are keen on making the right investments that will drive growth across the board and ensure our competitiveness, despite the challenging business environment. We thank our shareholders for their confidence in the Board and Management of our dear company and we are committed to ensuring that we sustain the momentum.”

Guinness Nigeria is the Nigerian subsidiary of the Irish brand Guinness. Its principal activities continue to be brewing, packaging, marketing, and selling of Guinness Foreign Extra Stout, Guinness Smooth, Malta Guinness, Guinness Gold, Harp Lager, Smirnoff Ice, Satzenbrau Lager, Dubic Malt, Snapp, Orijin Spirit Mixed Drink, Orijin Bitters, Smirnoff Ice Double Black with Guarana, Orijin Zero, and Orijin Herbal Gin, Baileys Delight, Gordons Moringa among others.

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FBNHoldings Renews Adesola Adeduntan Tenure, Appoints Nnamdi Okonkwo as GMD

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Dr. Adesola Adeduntan - FirstBank CEO - Investors King

The Board of FBN Holdings Plc (FBNHoldings) has appointed the immediate past Managing Director of Fidelity Bank Plc., Mr. Nnamdi Okonkwo as its Group Managing Director.

Okonkwo’s appointment takes effect from January 1, 2022.

His appointment followed the retirement of Mr. U.K. Eke, who has completed his two-term tenure.

Uke, according to the board, tendered his Notice of Retirement on August 10, 2021

The Board further announced the renewal of the appointments of Dr. Adesola Adeduntan and Mr. Gbenga Shobo as the Managing Director and Deputy Managing Director of FirstBank respectively, for another term.

In the same vein, the Board announced the renewal of appointments of Mr. Kayode Akinkugbe and Mr. Taiwo Okeowo as the Managing Director and Deputy Managing Director of FBNQuest Merchant Bank Limited respectively, for another term.

“Uke’s retirement takes effect at the end of the current Financial Year on December 31, 2021. Mr. Eke’s retirement follows from a 35 years’ career in financial services, strategy, auditing, consulting, taxation, process reengineering and capital market operations.

“FBNHoldings Board has also announced that Eke will be succeeded by Mr. Nnamdi Okonkwo, a focused and result-oriented top banker, who will assume office as Group Managing Director, FBN Holdings Plc effective January 1, 2022,” Seye Kosoko, the Company Secretary said

Okonkwo, the immediate past Chief Executive Officer of Fidelity Bank Plc, brings to bear on the Board of FBNHoldings more than 30 years unbroken banking career spanning local and international experience. He has a wealth of experience in transformational leadership, business strategy development and visioning, innovative corporate governance and risk management.

He has led the transformation of banks, with the most recent being Fidelity Bank, where he led the management team for seven years to achieve remarkable results culminating in tripling profit and shareholder value.

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Are There Better Ways to Help Consumers Tackle Social and Environmental Problems?

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Consumers - Investors King

Techniques used by online microfinance platforms to spur user involvement could be useful in helping organisations to persuade people to behave in ways that benefit both society and environment.

Microfinance platforms have popularised the idea that ordinary people can become bankers to the poor. Communities of lenders get together every day to crowdfund microloans to disadvantaged micro-entrepreneurs by investing small sums of around only 25 dollars.

A new study digs into the universe of these microloan platforms to investigate how they manage to attract investors and perpetuate their enthusiasm for responding to social problems such as poverty.

Researchers from the Universities of Birmingham and Southern Denmark have identified two major ways through which platforms maintain and potentiate lending. Their findings are published in the Journal of Consumer Research.

Firstly, the platforms assemble resources that function as an ‘apparatus of affirmation’ – providing first-hand evidence of impact that help consumers imagine the benefits of their actions, thereby creating a sense of empowerment.

Secondly, the platforms translate complex and distant social problems, such as poverty, into personal encounters between lenders and borrowers – creating a sense of connection and familiarity via photographs, stories and loan updates. This set of techniques is theorised as the ‘apparatus of relatability’.

Co-author Dr Pilar Rojas-Gaviria, Lecturer in Marketing at the University of Birmingham, comments: “Organisations such as microlending platforms, which strive to mobilise responsible consumers, face two key challenges – overcoming the powerlessness felt when facing daunting problems, and removing a sense of disconnection from ‘faraway’ problems.

“Supplementing the power of ideas and knowledge with personal stories that inspire hope and aspiration, affinity and connection are powerful techniques that could be useful in inspiring consumers to more actively participate in efforts to tackle social and environmental problems, such as climate change.”

Through storytelling, imagery, platform design and communication, the researchers note that online microlending platforms nurture a feeling that genuine change is possible through affordable actions. They also develop a sense of affinity and empathy among potential investors with aspiring micro-entrepreneurs, particularly those from Low-and Middle-income Countries (LMIC).

For example, the platforms publish loan requests to showcase individual borrowers with first names, photographs, and short biographies. This personalised strategy effectively frames microlending as a virtual encounter with a borrower and their story of micro-entrepreneurship. Celebrities, such as actor Natalie Portman, have over the past years helped the microfinance industry to promote microloans as an act of hope that empowers resourceful poor in their efforts to escape poverty.

Co-author Domen Bajde, from the University of Southern Denmark comments: “The advent of online microlending has expanded the pool of potential investors to anyone with internet access and $25 to spare.

“After learning that lenders were more interested in ’emotional returns’ rather than financial profit from their loans, platforms began to dramatise microlending as an act of aspirational hope and affinity toward the entrepreneurial poor.”

The research is also significant for charitable giving, noting that donors are more likely to contribute when they see their donations as a way of empowering the disadvantaged and when donations are experienced as impactful investments.

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