Pix: From Bloomberg
FCMB Group has issued it’s long awaited profit warning advising investors that earnings will be materially bad. Here is an excerpt of the statement with focus on the words of the group CEO.
According to Peter Obaseki, the Managing Director of FCMB Group Plc, “3Q15 earnings as at September 2015, will be materially below earnings for the same period in 2014, due to two
factors: a spike in impairments particularly in the energy sector and the significant reduction in trade finance-related revenues due to foreign exchange illiquidity. This trend continued in 4Q15 and largely emanated from wholesale banking activities, while retail banking showed
greater resilience and earnings momentum. 2016 will be characterised by continued growth in retail contribution, stabilisation of wholesale banking revenues and increased focus on cost
efficiencies (opex, funding and risk) in order to restore earnings levels”.
FCMB shares is already down 8% in trading this morning and is on its way down to becoming a penny stock (trading in kobo). The stock has now lost about 48% in value in the last one year alone. This latest announcement is bound to send the stock further down the path of value losses.