Finance

Improved Half-year Earnings Lift Equities Market to N12.7tn

Published

7 years ago

July 31, 2017

Nigerian Exchange Limited - Investors King

Improved Half-year Earnings Lift Equities Market to N12.7tn

It was highly rewarding for investors at the stock market last week as the market continued on its gaining streak for the third consecutive week. The market closed with a record weekly gain of N980 billion in capitalisation to be at N12.705 trillion while the Nigerian Stock Exchange (NSE) All-Share Index soared by 8.3 per cent to close at 36,864.71.

Similarly, all other indices finished higher during the week with the exception of the NSE ASeM Index that depreciated by 1.09 per cent.

However, the gains recorded last week were majorly propelled by reactions to positive hall year financial results by companies. Although it was mixed grill, many of bellwether companies impressed investors with increase in their bottom-lines for the half year ended June 30, 2017.

Daily Market Performance

The bulls remained in control when trading resumed on Monday, lifting the NSE index by 1.86 per cent to a new year high of 34,652.52. Similarly, the market capitalisation appreciated near N12 trillion mark, closing at N11.94trillion.

The appreciation recorded in the share prices of Zenith Bank, Lafarge Africa, Access Bank, Dangote Cement, and UBA was mainly responsible for the gain recorded in the Index.

Investors traded 293.75 million shares worth N3.94 billion in 3,712 deals. The most actively traded sectors were: Financial Services (254.52 million shares), Conglomerates (16.51 million shares), and Consumer Goods (11.31 million shares), while the three most actively traded stocks were: Access Bank (73.56 million shares), UBA (34.61 million shares) and GTBank (32.57 million shares).

In terms of sectoral performance, three sectors closed in green, while two in red. The NSE Industrial Goods Index topped gainer’s chart, appreciating 2.5 per cent due to sustained buying interest in Dangote Cement Plc and Julius Berger Nigeria. The NSE Banking index trailed, chalking up 1.1 per cent, while the NSE Oil & Gas Index ended the day 0.1 per cent higher. On the flip side, the NSE Consumer Goods Index fell 0.5 per cent due to sell-off in Nestle Nigeria Plc and PZ Cussons. In the same vein, the NSE Insurance Index shed 0.4 per cent.

The market recorded its 14th positive consecutive session, as investors remained bullish on value stocks ahead of earnings releases. Consequently, the NSE ASI advanced by 1.19 per cent to close at 35,065.47, increasing the month-to-date and year-to-date returns to 7.29 per cent and 32.22 per cent, respectively.

The bourse recorded gains across all sectoral indices led by the NSE Industrial Goods Index with 2.9 per cent. NSE Banking Index and NSE Oil & Gas Index added 2.6 per cent and 1.7 per cent in that order. The NSE Insurance Index appreciated by 0.59 per cent, just as the NSE Consumer Goods Index rose by 0.12 per cent.

Following a 15-day bull run, the market hit a new year high on Wednesday moved closer to a three-year high after the index rose 3.4 per cent to hit 36,740.77, while market capitalisation closed higher at N12.662 trillion. That was a 32-month high, which was last attained in November 2014.

However, Wednesday bullish performance was largely driven by appreciation in Dangote Cement (+4.9 per cent), Nigerian Breweries (+5.0 per cent) and GTBank (+5.0 per cent).

All sectoral indicators closed positively in line with the bullish trend. The NSE Banking Index recorded the highest gain, rising by up 3.7 per cent due to appreciation in GTBank (+4.9 per cent) and Zenith Bank (+6.7per cent). The Consumer Goods Index trailed with a gain of 2.8 per cent on the back of gains recorded by Nigerian Breweries (+5.0 per cent) and PZ Cussons (+5.0 per cent).

Also, the NSE Industrial Goods Index added 2.5 per cent higher due to a rally in Dangote Cement (+4.9 per cent), just as the NSE Oil & Gas Index chalked up 1.8 per cent. The NSE Insurance Index closed 0.4 per cent higher.

The market sustained its rally on Thursday as the index rose by 1.37per cent to close at 37,245.17, while the market capitalisation hit N12.84 trillion.

The appreciation recorded in the share prices of Zenith Bank, UBA, Seplat, Nestle, and Nigerian Breweries bolstered the Thursday performance.

Investors traded 542.8million shares valued at N8.01 billion in 5,939 deals on that day, up 72.5 per cent from N4.64 billion recorded the previous day.

The most actively traded sectors were: Financial Services (437.04 million shares), Consumer Goods (53.59 million shares), and Conglomerates (22.90 million shares), while the three most actively traded stocks were: UBA (117.26 million shares), Zenith Bank (63.03 million shares) and Diamond Bank (52.15 million shares).

However, performance across the various sectors was mixed as three of five indices closed in the green. The NSE Consumer Goods Index led with 3.8 per cent trailed by the NSE Insurance Index that added 2.2 per cent.

The bears set in on Friday on profit taking after 16 consecutive days of bull run, making the index to depreciate by 1.02 per cent to close the week at 36,864.71. Profit taking in the share prices of Dangote Cement, FBN Holdings, UBA, Access Bank, and Nigerian Breweries was mainly responsible for the decline recorded on Friday.

The most actively traded sectors were: Financial Services (417.57 million shares), Conglomerates (58.39 million shares), and Consumer Goods (28.29 million shares), while the three most actively traded stocks were: FBNH (96.86 million shares), Diamond Bank (88.08 million shares) and Transcorp (57.84 million shares).

Market Turnover

Meanwhile, a total turnover of 2.211 billion shares worth N30.636 billion in 26,287 deals were traded last week by investors in contrast to a total of 3.628 billion shares valued at N34.886 billion that exchanged hands the previous week in 19,834 deals.

However, the Financial Services Industry led the activity chart with 1.735 billion shares valued at N19.044 billion traded in 14,626 deals; thus contributing 78.45 per cent and 62.16 per cent to the total equity turnover volume and value respectively. The Conglomerates Industry followed with 165.396 million shares worth N454.240 million in 1,400 deals. The third place was occupied by Consumer Goods Industry with a turnover of 135.802 million shares worth N6.681 billion in 4,143 deals.

Trading in the top three equities namely – United Bank for Africa Plc, FBN Holdings Plc and Access Bank Plc, accounted for 798.334 million shares worth N7.165 billion in 5,855 deals.

Also traded during the week were a total of 1.732 million units of Exchange Traded Products (ETPs) valued at N13.711 million executed in 19 deals compared with a total of 40 units valued at N493.60 transacted two weeks ago in four deals.

Also, a total of 750 units of Federal Government Bonds valued at N695,229.29 were traded last week in eight deals, compared with a total of 13,465 units valued at N14.486 million transacted the previous week in 10 deals.

Price Gainers and Losers

The price movement chart showed 51 equities appreciated higher than 36 equities of the previous week, while 23 equities depreciated in price, lower than 33 equities of the previous week. Conoil Plc led the price gainers with 21.4 per cent, trailed by Presco Plc with 20 per cent. Dangote Sugar Refinery Plc appreciated by 19.3per cent just as May & Baker Nigeria Plc chalked up 15.7 per cent. Stanbi IBTC Holdings Plc garnered 15.5 per cent just as Okomu Oil Palm Plc closed 15.3 per cent higher.

Other top price gainers include: Fidson Healthcare (14.9 per cent); Ecobank Transcorporation Incorporated (13.3 per cent); C & I Leasing Plc (13.1 per cent) and Zenith Bank Plc (12.8 per cent).

Conversely, Cadbury Nigeria Plc led the price losers with 18.1 per cent, followed by Morison Industries Plc with 17.5 per cent. Livestock Feeds Plc and Neimeth International Pharmaceuticals Plc shed 13.3 per cent and 13 per cent in that order. UACN Property Development Company Plc and Unity Bank Plc went down by 8.9 per cent and 8.5 per cent respectively.

Other top price losers were: AIICO Insurance Plc (8.3 per cent); Red Star Express Plc (7.4 per cent); Chellarams Plc (4.9 per cent) and Cement Company of Northern Nigeria Plc (4.9 per cent).

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Samed Olukoya

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

Fidelity Bank Records a 120.1% Growth in PBT to N39.5bn in Q1 2024

Published

14 hours ago

May 2, 2024

Samed Olukoya

Fidelity Bank MD - Mrs Nneka Onyeali-Ikpe

In line with its upward growth trajectory, leading financial institution, Fidelity Bank Plc, has posted an impressive 120.1% growth in Profit Before Tax from N17.9bn at the end of Q1 2023 to N39.5bn for Q1 2024.

This was made known in the Bank’s unaudited financial statements released on the issuer portal of the Nigerian Exchange (NGX) on Tuesday, 30 April 2024.

According to the statement, Gross Earnings increased by 89.9% yoy to N192.1bn from N101.1bn in Q1 2023. The increase was led by a combination of interest income (90.7% yoy) and non-interest income (84.0% yoy).

Growth in interest income was primarily spurred by a higher yield environment and strong earning assets base, while the increase in non-interest income was led by double-digit growth in account maintenance charges, FX-related income, trade, banking services, and remittances, supported by increased customer transactions.

Commenting on the results, Nneka Onyeali-Ikpe, MD/CEO, Fidelity Bank Plc stated, “We are pleased to report another quarter of strong financial performance driven by our strategic focus on customer-centricity, digital innovation and operational excellence. Despite the challenging macroeconomic environment, we remained resilient and agile, delivering double-digit growth on key income lines while advancing our business sustainability agenda.”

In the period under review, the bank grew Net interest income grew by 89.5% yoy to N99.6bn from N52.6bn in Q1 2023, driven by interest and similar income as the yield on financial instruments improved to 14.7% from 10.1% in Q1 2023 (2023FY: 11.6%).

In line with the steady rise in interest rates through the year, average funding cost increased by 80bps ytd to 5.2%. However, NIM came in at 8.8% compared to 8.1% in 2023FY, as increased yield on earning assets surpassed funding cost to 15.1% from 13.3% in Q1 2023 (2023FY: 13.5%).

Similarly, Total Deposits increased by 17.2% ytd to N4.7tn from N4.0tn in 2023FY, driven by double-digit growth across all deposit types (demand, savings and term). Net Loans and Advances increased by 21.2% to N3.7tn from N3.1tn in 2023FY.

“Beginning the year on this inspiring note reaffirms our strategy of helping individuals to grow, inspiring businesses to thrive and empowering economies to prosper. We are committed to our guidance as we build a more resilient business franchise with a well-diversified earnings base in 2024,” explained Onyeali-Ikpe.

Ranked as one of the best banks in Nigeria, Fidelity Bank is a full-fledged customer commercial bank with over 8.5 million customers serviced across its 251 business offices in Nigeria and the United Kingdom as well as on digital banking channels.

The bank has won multiple local and international awards including the Export Finance Bank of the Year at the 2023 BusinessDay Banks and Other Financial Institutions (BAFI) Awards, the Best Payment Solution Provider Nigeria 2023 and Best SME Bank Nigeria 2022 by the Global Banking and Finance Awards; Best Bank for SMEs in Nigeria by the Euromoney Awards for Excellence 2023; and Best Domestic Private Bank in Nigeria by the Euromoney Global Private Banking Awards 2023.

Banking Sector

FCMB Group’s Digital Transformation Drives 62.4% Increase in Revenue

Published

14 hours ago

May 2, 2024

Samed Olukoya

FCMB Group Plc, one of Nigeria’s leading financial institutions, has reported a surge in its digital revenue for the 2023 financial year.

According to the 2023 audited financial results filed with the Nigerian Exchange Limited, FCMB Group’s digital revenue increased by 62.4% in digital revenue to N60.3 billion from N37.1 billion in the previous year.

With a strategic focus on digitalization, the group has successfully expanded its digital offerings, resulting in a significant uptick in revenue derived from digital channels.

In its 2023 financial report, FCMB Group highlighted the strides made in digital retail lending with over 1.6 million loans totaling N100.9 billion accessed, underwritten, and disbursed through digital channels.

Similarly, digital SME lending witnessed significant traction, with over 20,500 loans totaling N177.9 billion disbursed via digital platforms.

The group’s digital wealth propositions also experienced robust growth, with assets under management reaching N15.1 billion, reflecting a substantial increase from N8.5 billion in 2022.

The surge in digital revenue was attributed to the successful execution of FCMB Group’s digital strategy, which prioritizes innovation, customer-centricity, and operational excellence.

By embracing digital payments, wealth management, and lending solutions, FCMB Group has empowered a greater number of customers while driving revenue growth and operational efficiency.

Commenting on the financial performance, FCMB Group highlighted the reduction of its cost-to-income ratio to 66.3%, excluding revaluation gain (48.9% inclusive of revaluation income).

This achievement underscores the effectiveness of the group’s digital initiatives in optimizing costs and enhancing operational efficiency.

The robust financial performance was further underscored by FCMB Group’s profit before tax, which surged to N104.4 billion in 2023, indicating a remarkable 186% year-on-year growth.

Various divisions of the group, including banking, consumer finance, investment management, and investment banking, recorded robust earnings growth, reflecting the overall strength and resilience of the group.

Furthermore, FCMB Group’s gross revenue rose by 82.5% to N516.4 billion from N283 billion, driven by a 61.7% growth in interest income and a 154.4% growth in non-interest income.

Net interest income grew by 44.8%, propelled by an increase in the yield on earning assets.

In addition to its financial achievements, FCMB Group underscored its commitment to environmental sustainability by transitioning 160 branches to solar power, with 78% of its business locations now powered by renewable energy.

The group also secured funding of up to N13 billion from local development finance institutions to support customers in accessing solar energy solutions.

Looking ahead, FCMB Group reiterated its commitment to leveraging its unique group structure to build a technology-driven ecosystem that fosters inclusive and sustainable growth.

With a focus on continued innovation and digitization, FCMB Group is poised to sustain its growth trajectory and deliver value to its customers, shareholders, and communities across Nigeria.

Banking Sector

Ecobank’s Profit After Tax Grows to $407m in 2023

Published

15 hours ago

May 2, 2024

Samed Olukoya

Ecobank Transnational Incorporated (ETI) has reported a $407 million profit after tax for the 2023 financial year.

This represents an 11% increase from the $367 million reported for the year 2022 and reflects the pan-African banking group’s continued growth trajectory amidst challenging economic conditions.

The financial results, filed with the Nigerian Exchange Limited on Tuesday, showcased Ecobank’s robust performance despite the headwinds posed by higher inflation, interest rates, and currency depreciation across Africa.

The group’s profit before tax also rose by 8% or 34% when adjusted for foreign currency translation effects to $581 million.

According to Ecobank, the growth in profit was primarily driven by revenue outpacing expense growth, resulting in positive operating leverage.

The group’s pre-provision, pre-tax operating profit hit $951 million in the year under review, representing a 17% increase from the previous year.

Commenting on the financial results, Jeremy Awori, CEO of Ecobank Group, acknowledged the challenges faced by households, businesses, and governments across Africa in 2023.

Despite the economic uncertainties, Awori declared Ecobank’s unwavering commitment to its customers and stakeholders.

Awori stated, “Ecobank generated a return on tangible shareholders’ equity of 24.9% despite the challenging operating environment in 2023.”

Net revenue exceeded $2.0 billion for the first time since 2015, reaching $2.1 billion, underscoring the efficacy of Ecobank’s 5-year growth, Transformation, and Returns strategy.

The CEO attributed Ecobank’s encouraging results to its customer-centric approach and initiatives aimed at revenue diversification, growth, and low-cost deposit mobilization.

The consumer and commercial banking businesses witnessed an increase in their share of group-wide revenues and profits, indicating progress in strategic objectives.

However, amidst the overall positive performance, Ecobank’s Nigerian operations faced challenges, with profit before tax declining to $27 million in 2023 from $31 million in 2022, representing a 15% decrease.

The challenging operating environment in Nigeria, characterized by high inflation and currency depreciation, impacted the performance of the Nigerian segment.

Looking ahead, Ecobank remains committed to its strategic agenda, which emphasizes technology-driven innovation, revenue diversification, and cost management.

The group’s focus on disciplined cost management aims to redirect savings into investments in marketing, sales capabilities, and technology, driving sustainable returns in the future.

As shareholders approved a N10 billion rights issue, Ecobank is well-positioned to capitalize on emerging opportunities and navigate evolving market dynamics.

With a resilient performance in 2023, Ecobank reaffirms its commitment to driving growth, delivering value to shareholders, and advancing financial inclusion across Africa.