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eTranzact Posts N118.25m Decline in PAT in Q2 2020 as COVID-19 Bites




eTranzact’s PAT Declines By N118.25 Million in Q2 2020

eTranzact, Nigeria’s premier payment processing platform, on Thursday reported N118.250 million decline in Profit After Tax (PAT) for the second quarter (Q2) ended 30th June 2020.

The payment company revenue declined from N6.458 billion filed in the same period of 2019 to N5.769 billion in the second quarter of 2020.

This decline continues with gross profit as it declined by more than 50 percent from N553.428 million posted in the corresponding quarter of 2019 to N248.899 million in Q2 2020.

Selling and marketing costs surged during the period under review to N12.272 million, up from N7.397 million posted in Q2 2019.

However, despite eTranzact moderating its administrative expenses from N470.962 million achieved in Q2 2019 to N389.271 million in Q2 2020, operating profit plunged from N75.069 million in Q2 2019 to -152.644 million in Q2 2020.

Even finance cost rose from zero recorded in the corresponding quarter to N4.973 million while investment income declined from N66.246 million filed in Q2 2019 to N39.367 million in Q2 2020.

Profit after tax plunged from N96.094 million filed in the second quarter of 2019 to N118.250 million in the second quarter of 2020.

The company total assets increased to N6.9 billion, up from N6.767 billion posted in the same period of 2019.

Surprisingly the company’s liability also surged from N6.459 billion to N6.895 billion during the period under review.

Equity attributed to owners stood at N5.923 million, down from 306.702 million posted in the corresponding period of 2019.

A critical look into the company’s financial statements showed the COVID-19 pandemic broadly impacted the company’s revenue as cash receipt from customers during the period declined from N25.205 billion in Q2 2019 to N11.616 billion in Q2 2020, plunging cash generated from operations by 50 percent from N458.107 million to N227.012 million in Q2 2020, the peak of COVID-19 disruption.

Still, eTranzact up its investment by purchasing property, plant and equipment worth N288.952 million during the period.

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

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United Capital Lists N10Billion Senior Unsecured Fixed Rate Series I Bonds




United Capital N10Billion Senior Unsecured Fixed Rate Series I Bonds

United Capital Plc on Tuesday announced it has listed N10Billion 5 Year 12.5 per cent Senior Unsecured Fixed Rate Series I Bonds Due 2025 Under the N30,000,000,000 Debt Issuance Programme.

In a statement released through the Nigerian Stock Exchange, the company said “United Capital Plc – Listing of United Capital Plc’s N10Billion 5 Year 12.5% Senior Unsecured Fixed Rate Series I Bonds Due 2025 Under the N30,000,000,000 Debt Issuance Programme.”

“Dealing Members are hereby notified that United Capital Plc’s N10Billion 5 Year 12.5% Senior Unsecured Fixed Rate Series I Bonds Due 2025 under the N30,000,000,000 Debt Issuance Programme were today Tuesday, 22 September 2020 listed on Daily Official List of The Nigerian Stock Exchange.”

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Nestlé S.A. Up Stake in Nestle Nigeria Plc to 66.3%




Nestlé S.A. Switzerland Increased Stake in Nestle Nigeria Plc to 66.3%

Despite growing economic uncertainties amid a decline in economic productivity, Nestlé S.A, Switzerland, the parent company of Nestlé Nigeria Plc, has continued to up its ownership percentage in Nestle Nigeria.

Nestlé S.A, Switzerland now owned 66.3 percent of the Nigerian subsidiary.

This was after the company purchased additional shares of 229,697 units in Nestle Nigeria to bring the company’s total purchase from August 20 to date to 977,744 units.

Nestlé S.A has now spent a total sum of N1.17 billion to buy shares in three transactions in its Nigerian subsidiary in 22 days.

A break down of the transactions revealed that the purchase consideration for the 229,697 additional units of Nestlé Nigeria shares at an average price of N1,249.65 per unit is put at N287 million.

Experts said Nigerian shareholders were willing to sell because of the ongoing economic hardships being witnessed in the country.

The National Coordinator, PSAN, Boniface Okezie, said, “It is expected for the foreigners to take the holdings since Nigerian shareholders are offering to sell and no domestic investor has the ability to purchase.

“I don’t see it as a mission to take over the company; I believe it is a morale booster to the Nigerian company. The regulators are watching and they will react if they are crossing the threshold.”

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Nigerian Stock Exchange to Benefit From Low Valuations – Experts



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Stock Market to Benefit From Low Valuations – Experts

Investment experts have said the Nigerian Stock Exchange would benefit from low stock valuations despite the present mixed performance following sell pressure in banking stocks.

The experts hinged their analysis on the usual investors’ search for undervalued yields with strong fundamentals.

The NSE market capitalisation expanded by N14 billion last week but the All Share Index declined by 0.08 percent 25,572.57 basis points, highlighting the mixed performance of the Exchange amid growing economic uncertainties.

The analysts at Cordros Capital, in the review of the week performance, said the bourse could see a positive performance in the long run over compelling valuations while advising investors to exercise cautions when buying given current uncertainties.

They stated: “In the absence of a positive catalyst, and given the still uninspiring macro story, we guide investors to trade cautiously in the short term.

“However, we expect the market might benefit over the longer term on compelling valuations and as investors seek alpha-yielding opportunities in the face of negative real returns in the fixed income market.”

Experts at Afrinvest Securities, another Lagos-based investment banking company, said the new week would see investors taking profit, a situation they said could weigh on the Exchange and plunge stock value.

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