United Capital Plc recently released its results for the 12 months ended, December 2017. Gross earnings fell slightly from ₦9 billion in 2016 to ₦8.9 billion in 2017. Profit before tax also fell slightly from ₦6.3 billion in 2016 to ₦5.5 billion in 2017.
Profit after tax dropped from ₦6.9 billion in 2016 to ₦4.3 billion in 2017.Earnings per share also dropped from ₦1.15 in 2016 to ₦0.73 in 2017.
Why the drop?
The decline was largely due to an absence of extraordinary gains and a sharp spike in taxes. The company, in 2016 made ₦909 million from the sale of its 50% stake in Metropolitan Insurance, which was an extraordinary gain that was absent in 2017.
Tax provisions also rose sharply from ₦363 million in 2016 to ₦1.2 billion in 2017.
Income across several segments declined, with the exception of investment income which rose from ₦4 billion in 2016 to ₦4.9 billion in 2017.
Fees and commission income declined from ₦1.9 billion to ₦1.8 billion. Net interest margin fell sharply from ₦640 million in 2016 to ₦143 million in 2017. Other incomes also fell sharply from ₦2.3 billion in 2016 to ₦1.8 billion in 2017.
The company then declared a dividend of ₦0.35 per share, representing a 47.9% payout ratio.
United Capital Plc was incorporated in Nigeria as limited liability company on March 14,2002. It became a public company and was listed on the Nigerian Stock Exchange in January 2013 after a successful spin-off from United Bank for Africa Plc.
UCAP is a holding company with three subsidiaries namely United Capital Trustees Limited, United Capital Asset Management Limited and United Capital Securities Limited. Its areas of business include investment banking, trusteeship, asset management and stock-broking.
United Capital closed at ₦3.85 in today’s trading session on the NSE, up 9.07% year to date.