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All the major economic news from Nigeria in 5 minutes – 4/7/2017

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Summary of the top business, economic and political news in Nigeria today.

 

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  1. Oil companies seeking to renew their oil licenses or leases would be expected to pay a statutory application fee of $2 million, according to the Department of Petroleum Resources, DPR, in its latest templates for award and renewal of licenses of operators in the petroleum industry. Link
  2. The Federal Government is yet to pay oil companies a total of $1.07bn in cash call required for the development of joint venture assets for the first four months of the year. Link
  3. The Minister of Finance, Kemi Adeosun, on Monday said the Federal Government would rely heavily on technology to increase tax compliance under the recently launched Voluntary Asset and Income Declaration Scheme. The VAIDS was launched last week by Acting President Yemi Osinbajo to provide tax defaulters with a nine-month amnesty period within which to settle their tax liabilities without having to pay interest, penalties or face prosecution. Link
  4. Nigeria and other ECOWAS countries will benefit from the 50 million-euro European Union (EU) fund set up to ensure sustainable fisheries development and marine security, an EU official says. Link
  5. A top official of the Ministry of Budget and National Planning says the ministry is reviewing the National Integrated Infrastructure Master Plan (NIIMP 2014-2043) to ensure its successful implementation.  The official said the ministry had been receiving technical support from its global firm, Akintola Williams Deloitte Inc. in the review of the document. Link
  6. The International Civil Aviation Organisation’s Council has elected the Nigerian representative, Capt. Musa Nuhu, as its second vice president. Link
  7. Finance Minister Mrs Kemi Adeosun yesterday said the Federal Government planned to raise over $1billion from the executive order signed by Acting President Yemi Osinbajo. Link
  8. The Comptroller General of Customs, Col. Hameed Ali (Rtd), has launched the Electronic Auction (E-Auction) portal as bidding for seized and overtime vehicles started by 12:00 noon on Monday. Speaking shortly before he launched the portal, Col. Ali said the launch marked the end of the manual process which had many complaints of fraud. Link
  9. The Federal Government’s ban on the importation of dirty fuels into the country failed to come into effect on July 1, 2017 as announced in December last year. Link
  10. The Minister of State for Petroleum Resources, Emmanuel Ibe Kachikwu, has said the nation’s three refineries in Warri, Kaduna and Port Harcourt could become obsolete in the next three to four years, hence the move by the government to repair and upgrade them. Link
  11. Association of Chartered Certified Accountants, ACCA, in a recent study, revealed that Nigeria is on the course to reduce the size of its shadow economy to 46.11 per cent of the Gross Domestic Product, GDP, by 2025 from 48.37 per cent in 2016. Link
  12. The Abuja Electricity Distribution Company(AEDC) is set to procure additional 30,000 prepaid meters to intensify mass metering of customers in its  franchise locations. The locations are Kogi, Niger, Nasarawa  and  the Federal Capital Territory. Link
  13. Manufacturers spend at least N378 billion on private electricity generation to power their operations as public grid power supply remains unreliable. The president of Manufacturers Association of Nigeria (MAN),  Dr Frank Udemba Jacobs said manufacturers of consumable and non-consumable products spend N126billion yearly to generate power, lamenting that the figure amounted to N378billion when multiplied by three years. Link
  14. The Federal Ministry of Power said an estimated $3.5 billion budget appropriations will be required as part of the funding plan needed to revive Nigeria’s power sector.  This is expected to ensure that a minimum baseline power generation of 4,000MW is guaranteed and distributed daily from 2017, to ensure stability of the grid. Link
  15. The Auditor-General of the Federation (AuGF), Mr. Anthony Mkpe Ayine, last Thursday submitted the final part of the 2015 audited report of the ministries, departments and agencies (MDAs) of the federal government to the Clerk of the National Assembly, Alhaji Mohammed Sani Omolori, bringing to a closure the almost one-year delay in the submission of the all-important report. Link
  16. Minister of Agriculture and Rural Development, Chief Audu Ogbeh, has disclosed that Nigeria has developed a blueprint to earn at least $10.0 billion annually from yam export in the next four (4) years. Link
  17. The General Manager, Production, Nigeria LNG Limited, Mr. Tayo Oginni, has said making amendments to the NLNG Act will lead to the double taxation since gas suppliers to it already pay the Niger Delta Development Commission’s three per cent levy. Link
  18. The Nigerian National Petroleum Corporation (NNPC) and International Oil Companies (IOCs) operating in the country including independent oil companies lifted  crude oil and condensate worth over $36.023 billion between March 2016 and March this year, according to NNPC April statistical report. This translates to N11.005 trillion at an exchange rate of N304.5 to a US dollar. The IOCs consist of Chevron Nigeria Limited, Exxonmobil, Total, Nigeria Agip Oil Company (NAOC)/Phillips, Shell Petroleum Development Company (SPDC) and Addax including 24 independent companies among them Seplat Petroleum, Pan Ocean, Newcross, Eroton, Neconde, ND Western, Elcrest, ConOil, Amni, Platform Petroleum and Niger Delta Petroleum Development Company. Link
  19. The Citibank (Citi) has granted a N500 million loan to Accion Microfinance Bank (Accion MFB) as part of efforts to promote the development of the microfinance sector in Nigeria. Lola Oyeka, the bank’s Country Public Affairs Officer for Nigeria and Ghana said the grant will fund Accion’s loan portfolio and support the development of approximately 5,000 micro and small enterprises in the country. Link
  20. Shell Petroleum Development Company (SPDC) has blamed the non-diversion of natural gas from the deep-water Bonga oilfield to the domestic market on third parties, stressing that it has largely concluded its technical scope of the Bonga diversion project initiated to supply 120 million standard cubic feet of gas per day, an equivalent of 650 megawatts of electricity into the domestic market. Link
  21. The Nigerian National Petroleum Corporation, NNPC, has secured $2billion discounts in the last one year from renegotiated Upstream contracts being executed by its various service providers. The Corporation said the feat was achieved in the quest to continually drive down the high cost of production in the industry. Link
  22. Guinness Nigeria on Tuesday launched a share sale to raise 39.7 billion naira ($126 million) from existing shareholders to help lower its financing costs after reporting its first annual loss in 30 years last year. The beer maker, the local division of the world’s leading spirit maker Diageo, said funds raised will support Guinness in executing its strategy in the face of a recession in Africa’s biggest economy. Link
  23. The Transmission Company of Nigeria (TCN) has disclosed that it is prepared to build two new 330KV substations in Kaduna and Zaria, and four additional 132 KV substations at Rigasa Kakau, Rigachun and Jaji, while it will reconstruct the Kaduna-Kano transmission line. Link
  24. Orange and Vodafone Group are in “strong running” to buy 65 per cent of Etisalat Nigeria following Etisalat’s exit from the troubled operator, according to local sources. According to Brandish, “no fewer than five” companies have expressed interest in Etisalat Nigeria, although the two international telco giants have shown “concrete interest”. The potential hurdle, the report said, was the restructuring of the debt which caused the current uncertainty for the business. Link
  25. Visa Inc., the global leader in payments, and Interswitch, Africa’s leading integrated payments and transaction solutions company, have announced that they will partner to accelerate mobile payments adoption across the region. The partnership will see Visa and Interswitch upgrade the digital banking applications of leading banks to include mVisa, as well as enable more merchants to accept mVisa payments. Link
  26. The debt crisis rocking Etisalat Nigeria took a new turn Monday when the company’s chief executive officer (CEO), Mr. Matthew Willsher, and chief financial officer (CFO), Mr. Wole Obasunloye, resigned their appointments. Link
  27. Boye Olusanya, former deputy managing director of Celtel Nigeria (now Airtel Nigeria), will be the chief executive officer of Etisalat Nigeria during the transition period. Link
  28. The Lagos State Commissioner for Finance, Mr. Akinyemi Ashade has revealed that the state government is committed to reducing poverty and unemployment in the state through its newly established IBILE microfinance bank.  According to him, the state government would make MSME loans available to the residents of the state who plan to go into small-scale businesses, but lack the necessary capital to do so. Link
  29. Six Nigerian banks which included Zenith Plc, FirstBank Nigeria Limited, Guaranty Trust Bank Plc, Access Bank Plc, United Bank for Africa Plc and Diamond Bank Plc were ranked among The Banker Magazine’s Top 25 Banks in Africa that was released last night, in the magazine’s 2017 1000 Global Banks’ ranking. Link
  30. The Niger state government is to purchase 90 units of tractors and their implements this financial year, Governor Abubakar Bello has said.  Bello said the equipment would assist farmers in their land clearing business as a way of boosting food production. Link
  31. The Presidency said, yesterday, that the Acting President, Professor Yemi Osinbajo, has signed into law two of the critical bills recently forwarded to the executive for assent by the National Assembly. According to the Presidency, the two bills are the Petroleum Training Institute (Amendment) Act, 2017 and the Nigerians in Diaspora Commission (Establishment) Act, 2017. Link

 

 

 

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Patricia

Mudeerat Olawunmi is a graduate of Business Administration with over 5 years experience in online data gathering and analysis. Wunmi is a data analysts at Nairametrics and helps ensure that our readers get some of the most important macro and micro economic data required to help make investing decisions.

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Business

Austin Avuru retires as CEO of Seplat petroleum, to receive huge benefits

According to the notice, Avuru will be considered a “good leaver” on his retirement.

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Austin Avuru retires as CEO of Seplat petroleum, to receive huge benefits, Seplat to acquire more oil & gas assets after Eland's acquisition

Co-founder and Chief Executive Officer of Seplat Petroleum Development Company Plc, Austin Avuru has retired as CEO of the company, but will remain on the board as a Non-Executive Director.

According to a notice sent to the Nigerian Stock Exchange and signed by the company secretary Mrs Edith Onwuchekwa, the resignation took effect on July 31, 2020.

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READ MORE: Seplat denies swindling FG of N600 billion despite co-conspirator’s guilty plea

What this means

According to the notice, Avuru will be considered a “good leaver” on his retirement and receive his remuneration and benefits as such.

The Remuneration Committee has confirmed that Avuru will receive “a lump sum payment in lieu of notice equal to his salary, benefits, and pension allowance until November 18, 2020” as well as other security and travel benefits.

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He would also receive a loss of office payment equal to 12 months’ salary, as compensation and in accordance with the Nigerian market practice.

READ ALSO: Seplat’s Austin Avuru no longer has direct shares in company 

In line with the provisions of the Directors’ Remuneration Policy approved by shareholders of the Company at its 2018 AGM, he will also receive a pro-rata bonus (in cash) to reflect his time as CEO during the financial year, and same “will be provided in the Company’s Directors Remuneration Report for 2020 and subsequent years”.

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Seplat will also vest awards made in form of deferred shares in 2019 and 2020 at the normal vesting dates, and subject to the achievement of the relevant performance conditions, and Avuru will be subject to the post-employment shareholding requirement for two years.

The company management and board appreciated Avuru for his ‘excellent leadership’ in growing the company to become a notable player in the Nigerian and wider African hydrocarbon industry.

READ: Okomu Oil Palm ‘s profit declines by 43.22% as at Q3 2019  

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Backstory

On November 18 2019, Seplat Petroleum Development Company Plc announced that Mr Austin Avuru will be retiring as CEO at the end of July 2020.

This is in line with Avuru’s earlier plans to retire sometime around his 62nd birthday.

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UBA denies N41 billion NITEL fraud allegations

United Bank for Africa (UBA) has described the alleged N41 billion fraud levied against its Chairman, Mr Tony Elumelu, as untrue, misleading, malicious, and libellous.

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UBA Records 13% Earnings Growth and Delivers N111billion Profit

The Management of the United Bank for Africa (UBA) has described the alleged N41 billion fraud levied against its Chairman, Mr. Tony Elumelu, as untrue, misleading, malicious, and libellous, and said that it should be disregarded in its entirety.

This was disclosed in a statement issued by the bank to the Nigerian Stock Exchange and signed by the company’s secretary, Bili Odum, on Friday. Media reports in some online blogs alleged the former CEO of the bank was indicted” prompting the bank to issue a denial via a press release.

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In the press release stated Statement To The Nigerian Stock Exchange on False Reports in the Media, the bank stated that “it has set in motion all appropriate legal actions to ensure that the misleading reports are retracted and the perpetrators held accountable for their actions”.

READ MORE: Guinea Insurance Plc gives optimistic Q3 earnings forecast in spite of COVID-19

It also stated that it will “continue to conduct its business in line with global best corporate governance practices, extant laws, and regulations,” as it has done in over 70 years of operations.

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Back story: The counsel to NITEL, J.U Ayofu petitioned the Senate Committee Chairman on Ethics, Privileges and Public Petitions about the alleged fraud. The committee chairman, Senator Ayo Akinyelure, claimed the ”the N41billion alleged fraud was committed against the defunct Telecommunications company and National Carrier, NITEL”

They alleged the amount was withdrawn “systematically from NITEL for nine years” under the leadership of the bank.

READ ALSO: N1.5 billion Probe: Contractor could land in EFCC net for abandoning CCB project 

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Senate Committee Chairman on Ethics, Privileges and Public Petitions, Mr. Ayo Akinyelure, reportedly said, “The N41 billion alleged fraud was committed against the defunct telecommunications company and national carrier, NITEL.

According to the reports, in view of this, the senate committee has summoned the Group Managing Director/CEO of UBA, Mr. Kennedy Uzoka, to appear before it on Wednesday, August 5, 2020.

UBA denies wrongdoing

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Despite the allegations, the Management of the Bank denied all the allegations and will use all legal means to clear its name. “We have set in motion all appropriate legal actions to ensure that the misleading reports are retracted and the perpetrators held accountable for their actions.”

READ ALSO: More banks, insurance firms declare closed periods ahead of H1 results release

UBA’s 2020 second-quarter result is expected to be released next week. The market appears to have shrugged off the allegations as thee company’s share price closed at N6.2  gaining 3.3% week on week.

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Airtel Africa’s profit up 12.9%, customer base reaches 111.5 million

Airtel Africa had risen in customers’ base by 11.8% to 111.5 million in spite of the pandemic.

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Airtel Africa’s profit up 12.9%, customer base reaches 111.5 million in Q2

Airtel Africa on Friday posted an impressive Q1 ending June 2020 financial statement with an operating profit of $210 million up by 12.9%which showed a 111.5 rise in customers’ base of 11.8% to 111.5 million in spite of the ravaging COVID-19 pandemic. The Company also reported an operating profit of $210 million up by 12.9%.

Airtel reports its year end March 31st 2020.

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Key highlights of Airtel Africa Q1 2020 include;

  • Customer base grew by 11.8% to 111.5 million.
  • Revenue increased by 6.9% to $851m, with constant currency revenue growth of 13.0%
  • Constant currency revenue growth was recorded across all key business segments, with voice revenue up by 2.2%, data by 35.7%, and mobile money by 26.3%.
  • Underlying EBITDA increased by 7.9% to $375m, with constant currency growth of 14.6%
  • The reported underlying EBITDA margin was 44.1%, up by 40 bps.
  • Operating profit increased by 12.9% to $210m, an increase of 21.5% in constant currency
  • Free cash flow was $96m compared to $62m in the same period last year.
  • Earnings per share (EPS) before exceptional items was $1.0 cents and basic EPS was $1.1 cents.
  • Net debt to underlying EBITDA was 2.2x, compared to 3.0x in June 2019.

(READ MORE: Airtel Africa announces IPO result in Malawi, says its fully subscribed)

Raghunath Mandava, chief executive officer, Airtel Africa explained the company’s business was to survive the COVID-19 pandemic amid all odds. He said;

“During the last quarter, our business was impacted by the Covid-19 pandemic, as restrictions on movements of people and ways of socializing were introduced to contain the spread of infection. In these unprecedented times, we have worked with governments, regulators, partners, and suppliers to keep customers and businesses connected as well as supporting the economies and communities.

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“We focused on expanding and maintaining our network to ensure it could cope with increasing demand, we kept our distribution up and running by increasing the penetration of digital recharges and stock levels, and we expanded our home broadband solutions to ensure customers could work and access entertainment remotely.”

Raghunath Mandava, chief executive officer, Airtel Africa spoke about growing concerns on the resurgence of COVID-19, but he was optimistic based on Airtel Africa’s present result and investment. He continued by saying ;

“The outlook remains uncertain, particularly regarding a so-called potential second wave of infections and the actions governments will decide to take in that event. However, these results are further evidence of the growth opportunities our markets offer and the effectiveness of our strategy to focus on winning customers, investing in our network and expanding our voice, data and mobile money businesses.”

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The stock is presently trading at N348 with a market capitalization of N1.308 trillion, dividend yield at 3.38%, price/earnings ratio at 10.63 at the time this report was drafted.

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