GTCO’s H1 profit before tax increases by 217%

Guaranty Trust Holding Company Plc, has reported a profit before tax of N327.4billion, representing an increase of 217.1 per cent over N103.2billion recorded in the corresponding period ended June 2 The group released its Audited Consolidated and Separate Financial Statements for the period ended June 30, 2023, to the Nigerian Exchange Group (NGX) and London Stock Exchange (LSE). The Group’s loan book increased by 22.8 per cent from N1.89 trillion recorded as at December 2022 to N2.32 trillion in June 2023, while deposit liabilities grew by 37.0 per cent from N4.61 trillion in December 2022 to N6.32 trillion in June 2023. The Group’s balance sheet remained well structured and resilient with total assets and shareholders’ funds closing at N8.5trillion and N1.2 trillion, respectively. Full Impact Capital Adequacy Ratio (CAR) remained very strong, closing at 24.7 per cent, while asset quality was sustained as IFRS 9 Stage 3 Loans improved to 4.6 per cent in June 2023 from 5.2 per cent December 2022, however, Cost of Risk (COR) closed at 3.7 per cent from 0.6 per cent in December 2022 owing to worsening macros which caused significant increase in ECL variables. The Group Chief Executive Officer of Guaranty Trust Holding Company Plc, Mr. Segun Agbaje, said; “Our half year audited results reflect the strong business fundamentals underpinning the GTCO franchise, the quality of our past decisions in future proofing our balance sheet for challenging times, and the sound practices that guide our day-to-day operations. “Despite the challenges in the business environment, notably inflationary pressures and exchange rate fluctuations, we are starting to see the gains in the transformation of our businesses following our transition to a Holding Company structure. Improved profitability and a solid performance across key metrics reflect efficiencies and justify the investments we continue to make in technology, product development, and our people.”  “We recognise the impact prevailing economic and market conditions have on people and livelihoods and we remain committed to seeking better outcomes for our customers by ensuring that our products and service offerings support our customers and their businesses through their evolving realities, whilst also taking every opportunity to optimise stakeholder value,” he added. Overall, the Group continues to post one of the best metrics in the Nigerian Financial Services industry in terms of key financial ratios i.e., Pre-Tax Return on Equity (ROAE) of 61.4 per cent, Pre-Tax Return on Assets (ROAA) of 8.8%, Full Impact Capital Adequacy Ratio (CAR) of 24.7 per cent and Cost to Income ratio of 27.7 per cent. GTCO is a leading financial services group with banking operations in Nigeria, West Africa, East Africa, and the United Kingdom alongside new businesses in payment, funds management and Pension Fund Administration. Its leadership in the banking industry and efforts at empowering people and communities has earned it many prestigious awards over the years.

Nigeria’s equity market dips by N28bn

Transactions on the floor of the Nigerian Exchange took a negative trend on Wednesday, shedding N28 billion due to a decline in the share price of Transnational Corporation of Nigeria (Transcorps), Zenith Bank and FTNCocoa. The market capitalisation of listed equities went down by 0.08 per cent to N36.362 trillion from N36.390 trillion reported the previous day. The NGX All Share Index also depreciated by 50.81 basis points to 66439.53 points from 66490.34 points reported the previous day. An analysis of the investment showed that Chi Plc and Cap Hotel led gainers table in percentage terms, gaining 10 per cent each to close at N1.10 and N2.75 per share respectively. UPL followed with a gain of 9.77 per cent to N2.36 per unit, Champion Breweries gained 9.72 per cent to close at N3.50 per share, Thomas Way added 9.60 per cent to close at N2.17 per share. On the contrary, Transnational Corporation of Nigeria recorded the highest loss with 9.99 per cent to close at N6.31 per unit, Ikeja Hotel trailed with a drop of 9.88 per cent to close at N3.65 per unit, FTNCocoa fell by 8.11 per cent to close at N2.04 per unit, RTBriscoe down by 6.67 per cent to close at N0.42 per share. Volume of trades during the day decreased by 200.237 million, representing 45.82 per cent as investors traded 637.193 million shares valued at N7.790 billion in 10033 deals against 436.956 million shares worth N7.013 billion exchanged hands the previous day in 7932 deals. Transnational Corporation of Nigeria led market activities with 292.409 million shares worth N2.146 billion, AccessCorp followed with account of 26.652 million shares worth N435.491 million, Dangote Sugar Refinery exchanged 24.452 million shares worth N1.454 billion, Jaiz Bank traded 18.662 million shares cost N27.723 million while Fidelity Bank exchanged 17.386 million shares worth N122.281 million.

High operating costs weighing down manufacturing coys’ revenue

The harsh operating environment experienced in the country which worsened with scarcity of foreign exchange, removal of fuel subsidy have impacted negatively on the performance of the manufacturing industry as companies listed under the sector recorded 351 per cent losses in the first half of 2023. Investors in the nation’s Stock market said that shortages in forex supply coupled with inflationary pressure, currency redesigned of the Central Bank of Nigeria and other challenges witnessed from importing raw materials have affected the profit margin of manufacturing companies directly. They said that all these joined together resulted in a decline in purchasing power and sales volume and revenue of the companies in the first six months of their operations. This development according to them is currently impacting negatively on the share price of these listed firms under the manufacturing sector as most of the stocks are currently undervalued following negative sentiments that have enveloped demand for the stocks. Specifically, a financial analyst, Mr Iheanyi Egbue said that the huge import levies, exchange rate volatility, haulage cost of imported materials and heavy dependence on alternative source of power has increased cost of production in the sector by almost 30 per cent. Egbue said that the federal government failure to adopt a strategy that would encourage investment and development in the manufacturing sector mayerode shareholders 2023 full year dividend as the operating environment is currently very harsh and full of uncertainty. Another investor, Mrs Florence Okeke said that with removal of fuel subsidy, introduction of floating of exchange rate, manufacturing firms have experienced an unexpected high operating cost with the attendant reduction in profitability as operating costs are expenses associated with the maintenance and administration of a business on a day to day basis. She said with the high cost of living, the demand for goods and services have reduced drastically and as result most consumer goods companies in Nigeria have continued to find it difficult to weather the storm. For instance, a look at the performance of Cadbury Nigeria Plc listed under manufacturing segment of NGX showed that it declared loss before tax of N14.52 billion in the first half of the financial year ended June 30, 2023 against profit before tax of N3.35 billion reported in the same period of 2022. The company reported a loss after tax of N14.54 billion compared to profit after tax of N2.34 billion in the corresponding period of 2022. Also, Nestlé Nigeria Plc posted a loss after tax of N49.9 billion, a 280 per cent decline over N27.7 billion reported in the same period of 2022. The company recorded revenue of N261.8 billion in the first half of 2023, representing a 17.7 per cent increase compared to its performance in the same period of 2022. Nigerian Breweries Plc in the same vein reported N85.26 billion Net loss on foreign exchange transactions within the period under review from N7.28 billion in preceding year. The company also declared a loss of N47.6 billion in the first half of 2023 representing 348 per cent compared to N18.74 billion achieved in H1 2022.

Prudential Zenith grows profit by 18% in 2022

Prudential Zenith Life Insurance Limited (PZL) says it has recorded a profit after tax of N1.33 billion for the year ended December 31, 2022. The figure represented 18 percent increase when compared to N1.131 billion recorded in 2021. The company said this in a statement signed by the Head, Corporate Communications, PZL, Mr Bob Ononu, and made available at the weekend in Lagos. Ononu said that the company’s audited financial results for the year under review were approved by PZL’s Board and the National Insurance Commission (NAICOM). He stated that the result indicated that the firm achieved an impressive growth, despite a challenging business environment, characterised by rising inflation, deteriorating foreign exchange position and temporary cash shortages. He noted that the reported financial growth was released one month after PZL celebrated 175 years with Prudential Plc. and the parent company’s eight Prudential Plc’s subsidiaries in Africa. The company’s spokesperson stated that its top-line Gross Written Premium (GWP) declined by 15 per cent to N6.39 billion, compared to N7.5 billion in 2021. He said the insurers underwriting costs were effectively managed, resulting in an eight per cent growth in underwriting profit while investment income grew by 28 per cent year-on-year. According to him, the growth was due to a substantial increase in the company’s interest-generating assets. Ononu said that the shareholders equity grew by 11 per cent to N1.34 billion, between 2022 and 2021, reflecting an increase in retained earnings. “The 175-year milestone not only signifies Prudential’s rich heritage and enduring success, but also exemplifies the company’s commitment to continuous evolution and meeting the ever-changing needs of customers. “Prudential has over the years transformed countless lives through innovative insurance solutions that empower individuals and businesses to achieve financial security and prosperity,” he said. Comenting on the insurer’s 175 years celebration, Mr Chuks Igumbor, Managing Director, PZL, appreciated its customers and staff, while urging them to always uphold the firm’s core values and strive to help customers get the best of life. Prudential Plc is a leading provider of life and health insurance, as well as asset management services in 24 markets across Asia and Africa. The insurance company promotes financial inclusion and ensures healthcare affordability and accessibility, protects individuals’ wealth, helps them grow their assets, and empowers them to save for their goals.