UACN posts N14bn turnover in Q1 Wednesday, Jul 8 2009

UAC of Nigeria (UACN) Plc started this business year with appreciable growth in sales although the inability of the food company to pass down rising business costs to consumers impacted negatively on profitability.
First quarter report and accounts for the period ended March 31, 2009 showed that sales grew by about 33 per cent but the underlying pre-tax profit margin dropped from 14.5 per cent form first quarter 2008 to 11.9 per cent in first quarter 2009.
The report indicated a turnover of N14.02 billion in first quarter 2009 compared with N10.57 billion in comparable period of 2008. Profit before tax however rose marginally by 9.2 per cent from N1.53 billion in 2008 to N1.67 billion by March 2009. Profit after tax meanwhile rose by 13 per cent to N1.17 billion in first quarter 2009 as against N1.04 billion in similar period in 2008.
The actual performance of the conglomerate fell slightly below earlier forecasts for the period. UACN had estimated a turnover of N13.71 billion and pr4ofit after tax of N1.22 billion within the first three months of the year.
The first quarter performance also raised serious doubt on the potential of the conglomerate to achieve its half-year forecasts. The board of UACN had projected that the conglomerate could record about N4.5 billion as profit before tax during the six-month period ending June 30, 2009.
According to the forecasts, pre-tax profit margin is expected at 15.3 per cent while sales and net earnings are estimated at N29.2 billion and N3.03 billion respectively.
The first quarter performance however remained within the range of the forecasts for the full year ending December 31, 2009. The board of UACN had warned that the conglomerate might witness considerable slowdown in its profitability this year as Nigerian companies struggle against the muffling effects of inclement domestic operating environment and the global economic and financial crises.
UACN said some N1.34 billion might be shaved off its net profit in 2009 with post-tax profit expected to drop by about 20 per cent from N6.79 billion in 2008 to N5.45 billion in 2009.
Basically, shareholders’ earnings per share might drop by N1.04 with the forecasts indicating net earnings per share of N4.24 for 2009 as against N5.28 in 2008. This implies a significant loss in shareholders’ value given that expected net earnings per share loss of N1.04 could have added some 52 per cent to cash payouts, according to the payout rate for 2008.
The board of UACN said it expected 19 per cent growth in sales this year but growing costs could undercut net earnings by about 20 per cent. Turnover is projected at N62.52 billion in 2009 in contrast with N53.49 billion in 2008.
The projected earnings per share of N4.24 indicates a dividend cover of 2.12 times on the dividend per share of N2 paid for 2008 business year, leaving enough room for growth.
UACN had distributed a cash dividend per share of N2, totaling about N2.57 billion after net earnings jumped by 49 per cent in 2008. The current dividend per share of N2 represented an increase of about 18 per cent on N1.70 per share paid for 2007.
The conglomerate had increased cash payouts by 70 per cent last year with a total dividend per share of N1.70 for the 2007 business year as against N1 paid for 2006.
Audited report and accounts of UACN for the year ended December 31, 2008 showed that all the key actual profit and loss figures surpassed earlier forecasts made by the board of the company. UACN’s turnover had grown by 44 per cent while pre and post tax profits rose by 46 per cent and 49 per cent respectively in 2008.
Turnover rose from N37.16 billion in 2007 to N53.49 billion in 2008. Profit before tax stood at N8.78 billion in 2008 as against N6.0 billion in 2007. Profit after tax rose from N4.55 billion in 2007 to N6.79 billion in 2008. The board of UACN had projected a basic net earnings per share of N3.63 for the 2008 business year but actual net earnings per share nearly doubled at N5.28, representing an increase of about 121 per cent on N2.39 per share recorded in 2007.    The company had projected that turnover could crossed the N40 billion mark while profit before tax was expected at N6.58 billion in 2008. Profit after tax was estimated at N4.64 billion in 2008.
Market analysts were unsure of the ability of the conglomerate to meet or surpass projections for this year but many were sure that the conglomerate still possesses stable performance outlook.

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Nigerian stocks fluctuate over profit taking Thursday, Jun 18 2009

The Nigerian stock market continued on the downturn yesterday as investors profit taking swayed the overall market performance.
The market had been fluctuating for more than one week, dropping about N182 billion for the two days, representing about 2.64 per cent of the market value.
Both performance indices witnessed significant depreciation with the market capitalisation and All-share index dropping about 1.22 per cent and 1.21 per cent respectively to close for the trading session.
The market capitalisation which opened at N6.744 trillion shed N82 billion to close at N6.662 trillion while the All-share index also fell by 359 points to close at 29,215.89 points compared with its opening index of 29,574.89 points.
Mr. Musa Elakama, assistant director general of the Nigerian Stock Exchange (NSE) said during the presentation of the facts behind the figure of Ecobank Transnational Incorporated Plc that the market is circling at the moment which is a normal phenomenon for the market to behave in such way.
Elakama said it is expected that investors take profit from their investment which is what the market is witnessing.
He said when the market is experiencing downturn without positive improvement, then something is wrong somewhere.
Two food/beverages and tobacco companies: Nestle Nigeria and Flour Mills led the losers’ chart with N3.89 and N1.52 to close at N180.11 and N28.99 respectively.
They were followed by Julius Berger with a loss of N1.50 to close at N34.00. Flour Mills and Julius Berger had lost N1.46 and N1.50 on Wednesday to close at N30.51 and N35.50 respectively.
Lafarge Wapco lost N1.28 to close at N24.42. First Bank dropped N1.08 to close at N22.45 and Union Bank down by N1.05 to close at N19.95.
Also, NBC fell by N1.00 to close at N25.00. UBA shed 68 kobo to close at N14.31. Nahco depreciated by 57 kobo to close at N11.07.
On the upward side, Guinness Nigeria topped the chart with N6.00 to close at N128.00. Two petroleum marketing products companies: African Petroleum and Oando Plc followed with N4.00 and N3.00 apiece to close at N98.00 and N93.00. UACN added N1.90 to close at N41.90. UACN-Property Development gained 94 kobo to close at N19.90. ETI added 83 kobo to close at N17.54. Unilever Nigeria was up by 61 kobo to close at N14.61.
The banking sub-sector was the most active with a turnover of 463.28 million shares valued at 4.86 billion in 6,628 deals. The highest value recorded by the sector this year. Insurance sub-sector followed with a turnover of 86.88 million shares worth N124.40 million in 982 deals, information communication and technology sub-sector had a turnover of 58.23 million shares valued at N345 deals while food/beverages and tobacco sub-sector recorded a turnover of 16.83 million shares worth N293.33 million in 723 deals.

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Time to exhale for the NSE Tuesday, Jun 9 2009

 

 By Chuck Biosah

In my March 2, 2009 article, entitled “The NSE appears to be in recovery mode”, I indicated that the downtrend in the Nigerian capital markets appears to have been halted temporarily because for the first time since April 7, 2008, the failed rally of the NSE index did not breach the low of the previous failed rally. This is a phenomenon technicians call a “higher low” and an indication that the market was putting in a bottom.
Subsequently, the NSE index turned around on April 15, 2009 after touching a 52 week low of 19804. After bouncing off the 52 week low, the NSE index had a sustained six (6) weeks rallying closing at 30,924.97 on June 2, 2009, a gain of 11,121.4 or 56.1% from its most recent 52 week or 2009 low of 19,804 before running into head winds on June 3, 2009 as highlighted in the graph below:
However, although the index experienced its first decline on June 3, 2009, indications that the recent rally was weakening emerged in the closing prices of stocks on June 2, 2009 as most stocks were unable to close at their intra-day highs.
At the beginning of the current rally, I received several inquiries about the rally being a “Dead cat bounce”, My perception was that the rally was real and not a dead cat bounce because majority of the NSE listed stocks were above their 20 day and 50 day cumulative simple moving averages (DCSMA), and several stocks were attaining new 52 weeks highs. Nevertheless, as of Tuesday (June 2, 2009), I noted that we have come too far and very fast in a very short period, and to quote the famous former Chairman of the United States Federal Reserve Bank, it was beginning to look like” irrational exuberance” all over again. Traders are again beginning to throw caution to the wind; forgetting the last few months when there was a lot of “weeping and gnashing of teeth”
Although the index has declined by 1,410 or 4.6 per cent in the last two days, the current rally is still on course as the NSE index is still above its 20 DCSMA and the 50 DCSMA of 26,812 and 22,988.28 respectively. Technically, until the NSE index breaks above its 200 DCSMA of 31,520 and sustains it, the Bull Run will still have some head winds ahead of it.

Future NSE trend
The future appears bright for majority of the listed NSE stocks. However, some of these stocks need to pull back to reduce some of the recent irrational moves in their prices. The pull back will allow the stocks to consolidate some of their gains. Using the Fibonacci calculation, investors should look at Fibonacci retracements levels of 38 per and 50 per cent (i.e., 26,699 & 25,365) in the NSE index for a better entry. These retracement levels will still be above the NSE index of 20 day and 50 day cumulative simple moving average signifying that the current upward trend has not been derailed.
As the market retraces, I believe that Nigerian Breweries (NB) is worth watching. This stock can easily generate at least 25% profit for traders who buy above its current resistance level. On Friday (June 5, 2009), Nigerian Breweries (NB) lost N2.69 or 5% after running into a major resistance at N53. In the last three (3) weeks NB has been unable to break above this price level. This price level is acting as a price resistance because it is a prior 52 week high. On June 5, 2009, NB had an intra-day high of N53.00k, but closed at the intra-day low. NB is currently trading above its 50 day and 200 day cumulative moving averages, signifying a stock that is trending higher. I recommend that investors buy NB on a pull back to the N45 – N46 price level.

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New Issues Thursday, Apr 30 2009

The council of the Nigerian Stock Exchange (NSE) yesterday, approved new issues valued N19.705 billion.
Mrs. Yinka Idowu, general manager, corporate affairs of the NSE, confirmed that the approval came on the heels of recent renewed investors’ confidence in the Nigerian capital market.
A breakdown of the new issues approved showed a supplementary allotment of 1.064 billion ordinary shares of 50 kobo each at N9.50 per share for First Inland Bank Plc;  
Interlinked Technologies Plc got the council’s approval for placing of 200 million ordinary shares of 50 kobo each at N2.50 per share and rights issue of 141.6 million ordinary shares of 50 kobo each at N3.50 per share. Eterna Plc’s offer for subscription of 287 million ordinary shares of 50 kobo each at N11.50 per share and rights issue of 533 million ordinary shares of 50 kobo each at N9.95 per share were as well approved.
Yesterday’s approvals were an indication that operators in the market are considerably confident that investors are beginning to rekindle hope in the market. Market observers are optimistic that the new issues will boost activity in the market that has for many months running been bogged down by global recession that culminated in a loss of more than N76 trillion by investors.
Also yesterday, the market capitalisation of equities which opened at N4.871 trillion rose by N2 billion to close at N4.873 trillion while the NSE all-share index also appreciated by 10.06 points to close at 21,460.98 points.
About 34 stocks appreciated in value with Nestle Nigeria Plc gaining N7.70 to close at N161.72. It was followed by Nigerian Breweries which chalked a gain of N2.06 to trade at M43.28. UACN added N1.10 to close at N31.70; Total Nigeria rose by 97 kobo to close at N144.00; UACN-Property Development Company rose by 93 kobo to trade at N19.67 and Benue Cement Company appreciated by 62 kobo to close at N23.50.
Other gainers included GTBank which appreciated by 60 kobo to close at N12.75; Flour Mills rose by 54 kobo to close at N16.74 while First Bank of Nigeria Plc rose by 51 kobo to close at N15.43.
However, the losers’ outweighed the gainers’ with about 41 stocks depreciating in prices. African Petroleum led with a loss of N3.99 to close at N75.99. Guinness Nigeria Plc followed with N1.46 to close at N95.15; Union Bank shed 63 kobo to close at N12.06; Zenith Bank fell by 54 kobo to close at N15.00; Julius Berger depreciated by 49 kobo to trade at N24.49 and Intercontinental Bank dropped by 34 kobo to close at N7.85, among others.
Analysis of activities in the market showed that the banking sub-sector was the most active with a turnover of 277.58 million shares worth N2.81 billion traded in 4,708 deals. Insurance sub-sector came second with a turnover of 25.58 million shares valued at N23.87 million exchanged in 517 deals. Conglomerates sub-sector recorded a turnover of 8.52 million shares worth N24.32 million exchanged in 162 deals. Breweries had a turnover of 6.46 million shares worth N278.80 million traded in 237 deals while food/beverages and tobacco sub-sector recorded a turnover of 6.31 million shares valued at N90.87 million traded in 491 deals

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UACN Q3 profit hits N5bn Friday, Nov 14 2008

UAC of Nigeria (UACN) Plc consolidated its positive outlook in the third quarter as increased business efficiency uplifted the company’s intrinsic profit-making capacity and actual profit, putting it in good stead to meet its forecasts.
Interim report and accounts of UACN for the third quarter ended September 30, 2008 showed that the company’s profit-making capacity improved with a pre-tax profit margin of 18.5 per cent in 2008 compared with 14.6 per cent in comparable period of 2007.
The report showed that turnover rose by 28 per cent while pre and post tax profits grew by 62 per cent and 60 per cent respectively.
The nine-month report showed that UACN’s sales stood at N28.1 billion in third quarter 2008 as against N22 billion recorded in similar period of 2007. Profit before tax rose from N3.21 billion in 2007 to N5.2 billion in 2008. Profit after tax also jumped from N2.3 billion in 2007 to N3.7 billion in 2008.
The third quarter report already indicated earnings per share of N2.88 as against N1.79 recorded in third quarter 2007, raising expectations that the company might increase dividends.
The third quarter report also put the food-focus conglomerate in good stead to achieve its profit forecasts for the current business year ending December 31, 2008.
The board of UACN recently projected that net earnings would grow by about 52 per cent while turnover is expected to grow by 27 per cent.
The company projected that turnover could cross the N40 billion mark while profit before tax is expected at N6.58 billion in 2008. Profit after tax is estimated at N4.64 billion in 2008.
With basic net earnings per share expected at N3.63 per share by the end of this business year, as against N2.39 per share recorded in 2007, there are strong indications that the company may increase cash payouts this year.
Although its performance lagged in 2007, UACN had increased cash payouts by 70 per cent with a total dividend per share of N1.70 for the 2007 business year as against N1 paid for 2006.
Market analysts said a strong performance and major increase in distributable earnings would serve as impetus for the conglomerate to possibly raise cash payouts beyond 200 kobo mark or hearken to shareholders’ requests with a combination of cash payout and bonus issue.
Mr. Larry Ettah, group managing director, UAC of Nigeria (UACN) Plc has said key strategic initiatives taken to deepen core businesses and concentration of more resources on growth areas would lead to better returns to shareholders in the years ahead.
He said the focus of management would be on ensuring impressive simultaneous growths in gross revenue and profitability to make sure the gains of the business development drives reach shareholders.
According to him, the company is focusing its investments in areas with significant revenue growth opportunities in order to be in a position to drive overall performance and ensure that returns are not only adequate but sustainable.
He said the conglomerate has made significant carpet investments in the flavoured and milk yogurt, ice cream, cereal and restaurant businesses
He added that the company has embarked on expansion of its property profile as well as renovation and remodeling of its restaurants to meet varying demand of customers.
The UACN group managing director said the company’s growth strategy is food-focused which explained why there have been more investments in that area.
He said the decision by the board to pay cash dividend rather than the clamour for bonus issue was in the best interest of the company pointing out that it would benefit the shareholders more to build sustainable growth over the years.
UACN had recorded strong growth in sales in 2007 but high costs of sales and selling and distribution moderated the impact on the bottom-line, leaving the net earnings down by 4.6 per cent. Group turnover rose by 11 per cent to N31.5 billion in 2007 as against an increase of 4.7 per cent to N28.4 billion in 2006.
Profit before tax and minority interest grew by 31 per cent to N5.09 billion in 2007 compared with N3.89 billion in 2006. Profit after tax, but before minority interest and extraordinary items, jumped from N2.82 billion in 2006 to N3.78 billion in 2007. However, with no extraordinary items in 2007 and 50 per cent growth in minority interest, net earnings dropped by 4.6 per cent from N3.2 billion in 2006 to N3.06 billion in 2007. Basic net earnings per share thus dropped from N2.49 in 2006 to N2.39 in 2007.
Also, underlying profitability ratios showed a largely downward trend in 2007. Gross profit margin dropped from 25 per cent in 2006 to 23.5 per cent in 2007. Pre-tax profit margin improved from 14 per cent in 2006 to 16 per cent in 2007. Return on total assets dropped from 12 per cent in 2006 to 9.8 per cent in 2007 while return on equity slipped to 18 per cent in 2007 compared with 20 per cent in 2006.

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What’s Going On? Saturday, Jul 19 2008

The market is determined on its southern course. For several weeks now, it has maintained its downward trend. Analysts have come up with different reasons for the market’s unrelenting slide; from profit taking, distractions from private placements to stoppage of margin accounts and delay in budget passage. But one thing remains clear; the level of liquidity enjoyed by the market over the past three years has dropped in the last couple of months. Its liquidity level started this drop late last year as investors became enamored by IPOs/POs that flooded the market then. These offers, which were mostly oversubscribed, tied up over N700 billion in the primary market. As the Yuletide approached more investors exited their positions to have cash to meet expenses associated with the celebrations.

At the start of this year, the market raced out of the blocks as the index gained 9.23% in the first three months of 2008 to hit 63,986 from a year start 58,579. Today, the index has fallen below the year opening to 56,234, a 13.79% drop in two months. The market cap has not done any better. It started the year at N10. 284 trillion, rose to N12.31 trillion before falling to N10.95 trillion. The initial good showings were mostly due to returned monies from oversubscribed offers. Then CBN put a stop to margin accounts, which analysts said made up 20% of the market. Following this was a plethora of private placements. Though supposedly for sophisticated investors, private placements seem to be the darling of virtually all shades of investors now. The result being a continuous drain on the market as investors trim their portfolios to take up promising private placements.

While some analysts are quick to point to the reasons above, others have continued to be worried because they believe the slide goes beyond margin stoppage, private placements or the budget, but they have not been able to place a finger to the problem. The market authorities are also confounded. This much was revealed when they set up a committee to review the embargo on margin accounts. The move underlines the fact that they believe margin investing could arrest the market slide. Could it?

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Market update Tuesday, Jun 3 2008

Julius Berger Nigeria Plc led the gainers chart of the Nigerian Stock Exchange (NSE) last week as discerning investors move to position themselves ahead of the announcement of its audited results for the financial year ended December 31, 2007.
The share price of the company rose by N10.14 to close the week at N109.15. Investors exchanged 314,385 shares worth N33.605 million in 20 deals.
The reason for the renewed confidence in the shares of the construction giant may not be unconnected with anticipated improvement in its audited accounts and likely returns on investment against the backdrop of the favourable investment climate in the Nigerian construction industry.
During the financial year ended December 31, 2006, Julius Berger reported a turnover of N56.9 billion as against N39.84 billion in 2005. Its profit after tax stood at N1.12 billion compared with N626.9 million in 2005.
The directors recommended a dividend of 90 kobo per share which was approved by its shareholders at the company’s last year yearly general meeting.
Against this backdrop and given the massive infrastructural development as well as the strategic position of Julius Berger in the industry, it is being speculated that the company would do better both in operational performance and returns on investment.
The Nigerian construction industry is currently enjoying a boom because of the robust pace of economic activity resulting from the economic restructuring such as reduction in external debt and the policy drive by the Federal Government and state governments to dedicate resources towards significantly improving infrastructure such as road networks, water dams, power projects among others.
Also, there is increased demand for quality real estate projects in key cities due to the rural-urban migration and the concentration of commercial activities by companies and other institutions in these cities.
The construction industry has many participants but it is dominated by a few players.
It is also a high growth sector in terms of revenue
Julius Berger is one of the companies in the stock market with low capital base and also because majority of its shares are held by institutional investors, only a few of the shares held by Nigerian citizens and associates are available for trade because institutional investors hardly trade their shares unless when they are divesting.
In that case, such shares are either sold through a special sale offer on the NSE or through a block transfer to a new strategic investor.
As at December 31, 2007, Julius Berger has an authorised share capital of N172.5 million out of which N150 million is paid up.
Analysis of its ownership structure shows that Bilfinger Berger AG holds 49.87 per cent of the issued shares, Lagos State Government (Ibile Holdings Limited) 10.38 per cent, Plateau State Government (Plateau Investment Company Limited) 4.6 per cent, Nassarawa State Government (Nassarawa Investment Company) 0.08 per cent, Benue State Government (Benue Investment Company Limited) 5.2 per cent while Nigerian citizens and associations 29.87 per cent

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Return of the Bulls Monday, May 12 2008

The Nigerian stock market closed on a bullish note for the second consecutive day in the week as the market capitalisation of the equity sector experienced remarkable price appreciation.
The market capitalisation gained N159 billion to close at N11.61 trillion as highly capitalised stocks recorded price appreciation.
The percentage rise in the market capitalisation is about 1.39 per cent while the All-share index equally rose by 1.39 per cent to close at 60,069.86 points
The upsurge reflected in the market indicators was attributed to investors’ renewed interest in stocks.
On the whole, investors staked N10.95 billion on 609.39 million ordinary shares invested in 17,813 transactions.
Analysis of transactions on the exchange showed the banking sub-sector as the most active with a turnover of 310.16 million shares valued at N7.29 billion in 8,455 deals. Insurance sub-sector came next with a turnover of 165.08 million shares worth N611.12 million in 3,198 transactions, food/beverages and tobacco sub-sector ranked third with a turnover of 37.35 million shares valued at N826.34 million in 1,587 transactions and conglomerates sub-sector followed with a turnover of 19.28 million shares worth N305.66 million exchanged in 562 deals.
Packaging sub-sector came fifth with a turnover of 12.76 million shares valued at N115.58 million in 417 deals, building materials sub-sector recorded a turnover of 9.15 million shares worth N209.55 million in 280 deals, automobile and tyre sub-sector had a turnover of 6.12 million shares valued at N24.95 million in 369 deals while maritime sub-sector came behind with a turnover of 5.36 million shares valued at N46.87 million in 358 deals.
Nestle Nigeria topped on the gainers’ chart with N7.00 to close at N219.00. Oando Plc followed with N3.10 to close at N248.00, United Bank for Africa (UBA) added N2.75 to close at N57.75 and Zenith Bank was up by N2.24 to close at N47.24.
First Bank of Nigeria (FBN) rose by N2.20 to close at N46.20, Julius Berger appreciated by N2.01 to close at N99.01 while Nigerian Breweries (NB) and Union Bank of Nigeria (UBN) gained N2.00 apiece to close at N89.00 and N51.50 per share.
Cadbury Nigeria grew by N1.87 to close at N39.39 Eterna Oil climbed up by N1.84 to close at N38.80 per share, G Cappa rose by N1.47 to close at N31.27 and Beta Glass gained N1.15 to close at N24.15 per share.
However, on the contrary, Mobil Oil Plc led the losers’ chart with N10.91 to close at N225.00. It was followed by Costain (WA), shedding N2.35 to close at N44.81, Ecobank Transnational Incorporated (ETI) dropped by N2.10 to close at N247.90, Dangote Sugar Refinery lost N1.32 to close at N30.98 while Dangote Flour Mills slipped by N1.13 to close at N29.65.
Also, Berger Paints depreciated by 82 kobo to close at N15.68, B.O.C Gases fell by 81 kobo to close at N15.47, Air Services & Logistic shed 79 kobo to close at N17.20, Nigerian Bottling Company (NBC) lost 78 kobo to close at N60.00 and Pharma-Deko lost 68 kobo to close at N13.01 among others.

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Quarter results to boost market Thursday, Apr 24 2008

FSDH Securities Limited, a dealing member of the Nigerian Stock Exchange (NSE) has said it anticipate a recovery in the market after the lull seen during the week as the expect the release of companies’ results such as second quarter results of UBA Plc and the third quarter results of  Zenith Bank Plc

Other results that are being expected in the market this month which will impact on the market include the first quarter result of Dangote Sugar, full year report of UAC of Nigeria for the financial year ended December 31, 2007 and Guaranty Trust Bank Plc full year results for the financial year ended February 28, 2008

The All-Share Index (ASI) closed the week at 61,418.96 points, down from 63,736.14 points recorded in the previous week. The ASI recorded a depreciation of 3.64 per cent compared with the depreciation of 1.46 per cent recorded in the preceding week.

The further slowdown in activities in the market during the week was on account of the losses recorded in the insurance, banking and manufacturing sub-sector.

The market capitalization also depreciated to close the week at N11.8 trillion.  It depreciated by 3.64 per cent compared with the depreciation of 1.46 per cent recorded in the preceding week.

The depreciation recorded in the index was due to the gains recorded

in the share prices of Oando (Up 20.50 per cent to N241.00.00) and Mobil (Up 18.84 per cent to N283.00) despite the losses recorded in the share prices of Chevron (Down 7.94 per cent to N290.00), Total (Down 3.74 per cent  to N242.55) and African Petroleum (Down 2.33 per cent to N293.98).

Other top five gainers for the week were Premier Paints (Up 27.45 per cent to N23.26), A.G Leventis (Up 27.43 per cent to N17.47), Thomas Wyatt (Up 27.35 per cent to N11.36), Nigerian Wire (Up 27.30 per cent to N13.57) and Footwear & Accessories (Up 27.06 per cent to N7.70).

The top five losers for the week were Juli (Down 22.24 per cent to N4.86), Grommac Industries (Down 18.48 per cent to N9.97), Cadbury Nigeria Plc (Down 17.96 per cent to N36.50), BAICO (Down 17.52 per cent to N4.52), and Consolidated Hallmark (Down 16.24 per cent to N3.30).

Overall, 44 stocks recorded gains in their share prices,101 stocks recorded losses 70 stocks closed the week unchanged.

In the over the OTC bonds, a turnover of 195.84million units worth N202.85 billion in 1748 deals was recorded during the week, in contrast to a total of 223.51 million units valued at N228.83 billion exchanged in 2,021 deals during the week ended April 10, 2008. The most active bond (measured by turnover volume) was the 4th FGN Bond 2010 Series 14 with a traded volume of 60.7 million units valued at N61.7 billion in 464 deals.

In the money market, analysts at FSDH Securities anticipated that the tightness in the market during the week may ease as maturing bills worth about N83billion and the effect of the April allocation from the Federal Allocation Account Committee (FAAC) are expected to be felt more in the system. Consequently, we expect inter-bank rates to dip marginally during the week.

They maintained that the exchange rate at the official foreign exchange market should remain stable as a result of the huge foreign reserves of the country and the managed float strategy the CBN currently employs.

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PZ Cussons Q3 Saturday, Apr 19 2008

PZ Cussons Nigeria Plc witnessed appreciable growths across key performance indicators in the third quarter with strong net earnings raising optimism of better cash payouts.

Interim report for the nine months ended February 29, 2008 released yesterday showed that PZ Cussons recorded adjusted net earnings per share of more than 76 kobo by February 2008 as against 60 kobo in comparable period of 2007.

The report indicated that sales grew by 24 per cent while pre and post tax profits rose by 27 per cent each. There was however marginal improvement in the intrinsic profit-making capacity of the company with a pre-tax profit margin of 8.3 per cent in 2008 as against 8.1 per cent in 2007.

The report showed a turnover of N47.44 billion in 2008 as against N38.15 billion in 2007. Profit before tax rose from N3.09 billion in 2007 to N3.92 billion in 2008. Profit after tax and minority interest stood at N2.42 billion in 2008 compared with N1.91 billion in 2007.

Market analysts said annualised returns based on the third quarter report show possibility of increase in cash dividend for the current year ending May 31, 2008.

PZ Cussons had combined cash dividend of N1.8 billion and scrip issue of 635 million shares as returns in 2007. The conglomerate distributed a dividend per share of 71 kobo and bonus issue of one for four, which ranked within the highest fundamental returns in 2007.

PZ Cussons has maintained upwardly growth trend this year. Interim report for the six months ended November 30, 2007 indicated that adjusted earnings per share rose by 16 per cent to 44 kobo in 2007 as against 38 kobo in corresponding period of 2006.

Half-year report showed that sales rose by 24 per cent to N29.95 billion in 2007 as against N24.12 billion in comparable period of 2006. Profit after tax rose from N1.2 billion by November 2006 to N1.4 billion in 2007.

The third quarter report showed an improvement in the sale-to-profit performance of the conglomerate, which had in recent years recorded marginal growth in pre and post tax earnings.

Audited report and accounts for the year ended May 31, 2006 showed that initial improvement in profitability thinned out with jumpy growth in expenses, leading to decrease in returns.

Group turnover rose by 27 per cent in 2006 to N43.5 billion compared with an increase of 22 per cent to N34.14 billion in 2005. Cost of sales rose by 26 per cent to N32.3 billion in 2006 compared with N25.6 billion in 2005. The relative low growth rate of cost of sales nudged the gross profit to N11.22 billion in 2006 as against N8.52 billion in 2005, representing an increase of 32 per cent.

However, operating expenses grew by 38 per cent from N4.91 billion in 2005 to N6.79 billion in 2006 while interest expenses also grew by 70 per cent from N128 million in 2005 to N217 million in 2006. These impacted on the bottom-line. Pre-tax profit rose by 10 per cent to N4.80 billion in 2006 as against N4.38 billion in 2005 while profit after tax inched up by 5.8 per cent from N3.38 in 2005 billion to N3.57 billion in 2006.

Underlying ratios of the conglomerate further reflected the top-heavy nature of performance in 2006. Gross profit margin rose from 25 per cent in 2005 to 26 per cent in 2006 but pre-tax profit margin dropped from 13 per cent in 2005 to 11 per cent in 2006. Returns on assets and equity altogether dropped from 10 per cent and 17 per cent respectively in 2005 to 8.5 per cent and 13.2 per cent in 2006.

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Market Rebounds-Chevron takes the lead Tuesday, Apr 8 2008

Trading activities on the floor of Nigerian Stock Exchange rebounded on Monday as market capitalization appreciated by N89 billion to close at N12.1 trillion as some highly capitalized stocks recorded price appreciation. This could be attributed to fund managers taking positions for the new quarter.
This was reflected on the All-share index which rose by 0.74 per cent to close at 62,688.07 compared to its opening of 62,224.86 points.
Investors exchanged a turnover of 615.6 million ordinary shares valued at N8.866 billion in 17,972 deals.
Three petroleum marketing products, Chevron Oil Nigeria, Total Nigeria and Mobil Nigeria led the gainers’ chart with N13.70, N10.00 and N9.00 to close at N287.70, N230 and N209 per share. Julius Berger Nigeria followed with a gain of N5.65 to close at 118.65, Enamelware added N3.83 to close at N81.00, Benue Cement Company (BCC) appreciated by N2.25, to close at N47.25 Ecobank Transnational Incorporated (ETI) grew by N1.97 to close at N259.97, Dangote Sugar Refinery gained N1.70 to close at N38.70 while Northern Nigeria Flour Mills (NNFM) added N1.62 to close at N34.17.
Also, Oceanic Bank International appreciated by N1.30 to close at N27.30, Beta Glass rose by N1.24 to close at N26.16, Nigerian Aviation Handling Company (Nahco) grew by N1.15 to close at N30.60, Arbico gained N1.08 to close at N22.87, Seven-Up and Nigeria Bottling Company (NBC) rose by N1.00 apiece to close at N56.00 and N61.00 respectively.
Other price gainers include IBTC Chartered Bank ( Stanbic IBTC Bank) with an increase of 99 kobo to close at N20.94, Berger Paints added 95 kobo to close at N19.96, Nigerian Sport Lottery rose by 86 kobo to close at N18.21, Cutix gained84 kobo to close at N17.67, Tripple GEE appreciated by 78 kobo to close at N16.45 while Afribank and GlaxoSmithKline Consumer gained by 76 kobo apiece to close at N25.78 and N22.51 respectively.
However, Cappa & D’ Alberto topped the losers’ chart with N6.25 to close at N118.94. It was followed by Nestle Nigeria with a loss of N5.19 to close at N257, Conoil lost N3.50 to close at N140.50, Costain dropped by N2.72 to close at N51.77, Guinness Nigeria fell by N1.90 to close at N129.15, Okomu Oil Palm depreciated by N1.67 to close at N31.77 Alumaco shed N1.61 to close at N31.30, Eterna Oil & Gas lost N1.55 to close at N29.62, Unilever Nigeria dropped by N1.16 to close at N22.19while  Morison and West African Portland Cement (Wapco) depreciated by 1.10  apiece to close at N21.02 and N63.00 respectively.
Other price losers include May & Baker with a loss of 85 kobo to close at N16.15, John Holt lost 84 to close at N16.14, Grommac Industry depreciated by 71 kobo to close at 13.54, Nigeria-German Chemicals fell by 70 kobo to close at N25.80, Japaul Oil dropped by 69 kobo to close at N13.11, Longman Nigeria shed 65 kobo to close at N24.10 while A.G Leventis and Evans Medical depreciated by 59 kobo apiece to close at N14.50 and N11.31 respectively.
Analysis of transactions on the exchange showed the insurance sub-sector as the most active with a turnover of 236.4 million shares worth N1.177 billion in 4,237 deals. The banking sub-sector followed with a turnover of 229.9 million shares valued at N5.314 billion in 7,123 deals, conglomerates sub-sector came third with a turnover of 27.214 million shar4es worth N154.9 million in 710 deals while commercial/services sub-sector had a turnover of 23.988 million valued at N403.2 million in 180 deals.
Road transportation sub-sector ranked fifth with a turnover of 14.1 million shares worth N99 million in 536 deals, food/beverages & tobacco sub-sector recorded a turnover of 10.3 million shares valued at N310.3 million i8n 952 deals while agriculture/agro-allied sub-sector came behind with a turnover of 8.378 million shares worth N66.554 million in 227 deals.
A total of 126 stocks were traded on exchange yesterday out which 73 appreciated while 53 depreciated in value.

The club sees this trend sustaining till the early birds are done with re-aligning their portfolio for greater profitability.

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Cutix slows in Q3 Friday, Mar 28 2008

Cutix Plc recorded a mixed-grill in the third quarter as appreciable growth in sales failed to reflect on the bottom-line.
Interim report and accounts of the company for the third quarter ended January 31, 2008 showed that turnover rose by 28 per cent but profit after tax dropped marginally by 4.7 per cent.
The report showed a turnover of N975.75 million by January 2008 as against N762.21 million recorded in the comparable period of 2007. Profit after tax dropped from N88.5 million in 2007 to N84.3 million in 2008.
The third quarter report has raised apprehensions on the prospect of the company in spite of management’s assurance that the company would surpass its full-year performance in 2007. Market consideration of Cutix dropped by 2.94 per cent at the weekend as the third quarter report hit news.
Chief Ajulu Uzodike, chief executive and chairman, Cutix Plc has recently assured that the company would surpass its previous performance in the current year ending April 2008 noting that training and skill certification programmes are leading to significant improvements in productivity.
Audited report and account of the company for the year ended April 30, 2007 showed that pre and post tax profits doubled as pre-tax profit margin rose by six percentage points from 11.3 per cent in 2006 to 17 per cent in 2007.
The report showed a turnover of N1.1 billion in 2007 as against N714.2 million in 2006, representing an increase of 54 per cent. Profit before tax rose by 132 per cent from N80.9 million in 2006 to N187.6 million in 2007. Profit after tax grew by 124 per cent to N121.7 million in 2007 as against N54.3 million in 2006.
The company has grown consistently over the years. The company’s first scrip issue in 1991 was two new shares for every two held, the second scrip issue in 1993 was two new shares for every three shares held. Subsequently scrip issues in 1996, 1998, 2001, 2005 and 2007 were one new share for every one held.
Ajulu Uzodike, the largest shareholder in Cutix, said the company has necessary human and technological resources to sustain its impressive returns record even as it graduated to the main tier of the Nigerian Stock Exchange (NSE).
He said the company would move up the corporate governance ladder by separating ownership from management.
“One of the reasons for taking Cutix to the Exchange was to help create a culture where good business practices about separation of ownership and management are followed so that the company would have a good chance of surviving the founder and founding owners and stakeholders,” Ajulu Uzodike said.
He said the board has appointed Mr Ifeanyi Uzodike as the new chief executive officer to take over from him.
He said the board unanimously decided on Ifeanyi Uzodike as the rightful successor that could consolidate the growth of the company.
According to him, the appointment of the Ifeanyi Uzodike was guided by his commitment to the ideals and mission of the company and proven leadership traits within and outside the company.
He stated that since his employment in 1991, Ifeanyi has held several management positions that put in good stead to lead the company as the chief executive.
Cutix, an electrical and telecommunications cables-manufacturing company, was listed on the NSE in 1987. Cutix was incorporated on November 4, 1982 and started with a capital of N400, 000 mid 1983 after a private placement brought together 18 founding shareholders. The company raised additional N1, 664,000 through the NSE in August 1987, thus becoming the first private company east of the Niger to be listed in the exchange. Since then it has financed its growth chiefly by retention of internally generated funds.

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The Bears Are Here! Friday, Mar 28 2008

Trading activities on the floor of the Nigerian Stock Exchange (NSE) continued on its week-long bearish trend yesterday as major highly capitalised stocks suffered depreciation.
The market capitalisation of the equities sector fell by N78 billion to close at N12.06 trillion as against its opening of N12.14 trillion while the All-share index equally depreciated by 0.64 per cent to close lower at 62,098.60 points.
The crash in the market indicators was attributed to profit-taking by investors.
Investors exchanged a total of 606.9 million ordinary shares worth N10.8 billion in 18.582 transactions.
Analysis of transactions showed the insurance sub-sector leading with a turnover of 239.96 million shares valued at N961.8 billion invested in 3,827 deals. Banking sub-sector followed with a turnover of 171.75 million shares worth N4.6 billion in 7,241 deals, food/beverages and tobacco came third with a turnover of 54.3 million shares worth N2.1 billion in 1,346 deals and automobile and tyre sub-sector had a turnover of 21.6 million shares valued at N119.6 million in 616 deals.
Breweries sub-sector came fifth with a turnover of 19.3 million shares worth N421.6 million exchanged in 472 deals, conglomerates sub-sector ranked sixth with a turnover of 17.3 million shares valued at N160.4 million in 894 deals and industrial/domestic products came behind with a turnover of 8.2 million shares worth N95.7 million 383 deals.
In a total of one hundred and forty-eight stocks traded on Thursday, eighty-eight stocks depreciated in price. Chevron Oil led the losers’ chart with N17.00 to close at N350.00. it was followed by Ecobank Transnational Incorporated (ETI) with a loss N12.00 to close at N239.00, Oando Oil came third with a turnover of N11.87 to close at N225.62 and Nestle Nigeria shed N7.00 to close at N244.00.
Cappa and D’alberto fell by N6.93 to close at N131.77. Skye Shelter Fund lost N6.24 to close at N118.69, Costain (WA) dropped by N3.89 to close at N74.08, CAP Plc depreciated by N3.78 to close at N71.99, Nigerian Bottling Company (NBC) shed N3.20 to close at N63.00 while Eterna Oil slipped by N2.22 to close at N42.37.
Also, Lafarge Wapco followed with N2.00 to close at N63.00. Alumaco Plc shed N1.97 to close at N37.54 and Northern Nigerian Flour Mills lost N1.70 to close at N32.36 among others.
On the contrary, Conoil Plc topped the gainers’ chart with N6.10 to close at N128.10. it was followed by Enamelware N3.03 to close at N63.66, Dangote Sugar Refinery and Dangote Flour gained N1.80 and N1.66 to close at N47.80 and N34.87 respectively.
Seven-Up added N1.50 to close at N56.50, Chellarams gained N1.21 to close at N28.00, IBTC appreciated by N1.03 to close at N21.70, B.O.C Gases grew by N1.02 to close at N21.52, Total Nigeria garnered N1.00 to close at N223.00 while Morison climbed up by 85 kobo to close at N25.00.
Skye Bank rose by 82 kobo to close at N18.50, Arbico was up by 77 kobo to close at N16.29 and G Cappa added 75 kobo to close at N15.84.

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Weekly Summary Monday, Mar 17 2008

 

The Nigerian Stock Exchange (NSE) All-share index dropped last week by 1.7 per cent to close at 65,005.48 points in contrast to 65,842.59 points recorded the previous week.

In the same vein, the market capitalisation of all equities also closed lower at N12.4 trillion.

The crash in the market indicators resulted from the drop in the share prices of most highly capitalised stocks.

On the whole, a total turnover of 6.2 billion shares worth N99.65 billion in 113,089 deals was recorded last week compared with a total turnover of 4.83 billion shares valued at N67.8 billion exchanged in 103,238 deals the previous week.

The insurance sub-sector maintained the lead as the most active stocks during the week measured by turnover volume with a turnover of 2.22 billion shares worth N11.05 billion exchanged in 29,737 deals.

The volume in the insurance sub-sector was largely driven by activity in the shares of Universal Insurance Company Plc and Goldlink Insurance Company Plc.

Trading in the shares of the two insurance companies accounted for 932.92 million shares representing 42.05 per cent of the sub-sector’s turnover.

As in the preceding week, the banking sub-sector boosted by activity in the shares of First Bank of Nigeria (FBN) Plc and Intercontinental Bank followed on the week’s activity chart with a turnover of 1.56 billion shares valued at N51.7 billion in 35,467 deals.

In a total of one hundred and fifty-four stocks traded during the week, seventy-nine stocks appreciated which was lower than the eighty-nine recorded in the preceding week.

Cappa & D’alberto Plc led on the gainers’ chart with N26.61 to close at N147.00 per share, Ecobank Transnational Incorporated (ETI) followed with a gain of N18.00 to close at N257.99 per share, Costain (WA) added N16.26 and Chemical & Allied Products Plc gained N16.00.

Other companies include Eterna Oil with N11.12. Nigerian Enamelware N7.53, Alumaco Plc N6.68, Dangote Sugar Refinery N6.60, Afroil Plc N4.96 while Seven-Up Bottling Company rose by N4.81.

Seven-Up Plc released its unaudited result for the half year ended September 30, 2007 which shows turnover of N13.9 billion as against N11.82 billion in the comparable period of 2006.

The company’s profit after tax stood at N655.62 million in contrast to N440.1 million recorded in 2006.

On the other hand, seventy-five stocks depreciated in price during the week which was lower than the fifty-nine in the preceding week.

Four petroleum products marketing companies, Conoil Plc, Mobil Oil, Total Nigeria and Oando Plc topped the losers’ chart with N34.58 to close at N118.38 per share, N27.10 to close at N210.00 per share, N23.00 and N20.41 respectively.

Other price losers in the category include Nestle Nigeria which dropped by N13.12, Flour Mills shed N9.39, Northern Nigerian Flour Mills (NNFM) N8.79, Dangote Flour N7.70, Nigerian Bottling Company (NBC) N4.00 while Ashaka Cement close losing N3.95 per share.

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Summary for the week Thursday, Mar 13 2008

Market activities in the first week under review were essentially influenced by profit takers most especially in the banking subsector. this had a slight reflection on the market indicators as the all share index gained momentarily by 0.72%. This can be established through the higher percentage of losers recorded in relation to the preceding week.

The technical suspension placed on Transcorp, Firstinland and Thomas Wyatt has been lifted. The All Share index opened the week with 65652.38 points and dropped by 0.38% on the fourth day of trading to close at 66121.93 points on the last trading day of the week. In all, The index gained 0.72% through the week under review. The market capitalisation also added a notch in the region of 0.09 trillion to close at 12.59 trillion from 12.50 trillion at which it opened.

The insurance subsectorcontinued its dominance, taking the shine of the banking sector. This was boosted by trading in the equities of Universal Insurance Plc. Volume traded onthe equity accounted for 35%of the total subsector’s turnover

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