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GT Bank trades heavy volumes as NSE stays red

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Guaranty Trust Bank Plc, Customer Experience: GTB, FCMB, Citibank, others emerge best banks in 2019  

The Nigerian Stock Exchange (NSE) continued its downtrend as the NSE All Share Index closed today at 36,470.5 basis points down 0.76%. Year to date, the index is down 4.64%.

Here is a summary of trading activities and corporate actions for today.

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Top Gainers

Wema Bank was the top gainer in today’s trading session appreciating 9.68%. The stock closed at N0.68.

Oando Plc closed at N5.20, up 9.47%. The stock had been on a downward trend since news of a judgment awarded against companies controlled by its Group Chief Executive Officer and Deputy Chief Executive Officer Omamofe Boyo.

Linkage Assurance closed at N0.79, up 8.22%

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Top Losers

E-Tranzact Plc closed at N4.10, down 9.89%. Livestock Feeds Plc closed at N0.68, down 9.33%. Tantalizers Plc closed at N0.21 down 8.70%.

Top trades by volume

78.3 million GT Bank shares valued at N2.9 billion were traded in 261 deals. The stock closed at N38, up 3.97%

50 million Medview Air shares valued at N102 million were traded in 3 deals. The stock closed at N2.08, down 2.80%.

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26.5 million Zenith Bank shares valued at N608 million were traded in 408 deals. The stock closed at N22.95, down 4.18%.

Corporate Actions released today

ETI appoints MD for Ecobank Nigeria

Ecobank Transnational Incorporated (ETI) today announced the appointment of Patrick Akinwuntan as Managing Director Designate for Ecobank Nigeria. His appointment is, however, subject to regulatory approval. Akinwuntan will replace Charles Kie who will be leaving the group.

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ETI HY 2018 results

The bank also released its results for the half year ended June 2018. Gross Earnings dipped slightly from N386 billion in 2017 to N384 billion in 2018. Profit before tax, however, jumped from N46.2 billion in 2017 to N65 billion in 2018. Profit after tax (from continuing operations) also rose from N37.6 billion in 2017 to N51.3 billion in 2018.

United Capital HY 2018 results

United Capital today released its results for the half year ended June 2018. Gross Earnings increased from N3.87 billion in 2017 to N3.88 billion in 2018. Profit before tax moved up slightly from N2.37 billion in 2017 to N2.38 billion in 2018. Profit after tax also increased from N1.9 billion in 2017 to N2.0 billion in 2018.

Royal Exchange Plc Q1 2018 results

Royal Exchange Plc, today released its financial statements for the first quarter ended March 2018. Gross Premium Written increased from N6.9 billion in 2017 to N7.6 billion in 2018.

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The company made a profit before tax of N579 million as against a loss before tax of N179 million in the corresponding period for last year.

Profit after tax stood at N389 million as against a loss of N237 million made in the corresponding period of 2017.

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Royal Exchange was one of 8 companies suspended from trading by the Nigeria Stock Exchange (NSE). The company released its full-year 2017 results yesterday.

RAK Unity Petroleum

RAK Unity Petroleum will hold its 15th Annual General Meeting on Thursday 16th of August 2018. The qualification date for its proposed dividend is Friday 20th of August 2018. The company’s shareholders register will be closed from Monday, 23rd July 2018 to Friday, 27th of July 2018 (both days inclusive).

The company has proposed a dividend of 10 kobo per share.

Multiverse Mining and Exploration Plc

Multiverse Mining Resources Plc HY 2018 re

Multiverse mining resources today released its results for the half year ended June 2018. Revenue increased from N3.2 billion in 2017 to N3.5 billion in 2018. Loss after tax also reduced from N324 million in 2017 to N85 million in 2018.

Patricia

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via [email protected]

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Research Analysis

Covid-19: POS transaction value drops by N96 billion due to lock down in April

Transaction volume and values dropped across major platforms due to the Covid-19 imposed lockdowns.

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PoS transactions hit N3.20 trillion in 2019, as stamp duty rip-off remain , Charges: Current accounts held drops by 4.5 million, as PoS transactions hit N373 billion, Digital payments sustains surge, affirms growth prospects

Total volume of payment transactions across Nigerian payment channels fell by a whopping 26% in April compared to the preceding month. The Nigerian Government imposed a lock down of economic activities in the commercial cities of Lagos, Abuja and Ogun States between March .

The data available were cheque, ATM, POS, E-bills and NIP (interbank transfers) transactions. The CBN data for April excluded other transaction channels such as Web, Mobile, NEFT etc.

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According to provisional data sourced from the central bank, total volume of transactions was 251.9 million in March but dropped to 186.6 million in April, the month of the lockdown. Transaction values also dropped from N12.3 trillion in March 2020 to N7.6 trillion in April 2020 a N4.6 trillion drop or 37.7% drop in transaction value.

READ ALSO: Zenith Bank’s Profit Before Tax Rises by 3% to N58.7 billion in Q1 2020

The last time Nigeria recorded payment transactions of less than 190 million for the subsets was in February 2018 at 159.9 million.

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The impact of the lockdown has been observed in several facets of the economy and is projected to lead the country into a second recession in 4 years. The lockdown was imposed as a counter measure against the rising cases of Covid-19 in the country. However, since the lockdown over 33,000 cases of Covid-19 has been recorded one of the lowest per capita in the world.

READ ALSO: 77% of BTC investors are in a state of profit

Payment Transaction Volumes and Vaue March vs April 2020
Source; CBN/Nairametrics.

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In terms of value, the NIBBS or (NIP) platform remains the dominant form of transferring money by value but suffered a N3.9 trillion drop in transaction values. This perhaps reflects the lockdown of economic activities as most companies who rely on this platform to make transfers operated minimally. Cheque channels even performed worse with only N10.3 billion in transaction value.

Explore useful research data from Nairametrics on Nairalytics

POS transactions, which reflects spending pattern of Nigerians via merchant outlets such as supermarkets, retail markets and shops, shopping malls etc. dipped by 26.2% from N368.9 billion in March 2020 to just N272 billion in April 2020. Despite this drop, the value of POS transactions recorded in April appears to be an improvement especially when you consider that average value POS transactions in the whole of 2019 was N267 billion per month.

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Nigerians spent more on food, medical supplies and household items during the lockdown period according to a basic survey conducted by Nairametrics.

READ ALSO: Nigeria’s Payment Channels Made a Record-breaking ₦86 trillion in 2017

Why this matters: Payment transactions are closely monitored by the financial sector participants particularly FinTechs as they form the basis for the billions of naira in fees and commissions earned on transactions. The hugely competitive electronic payment space means players in the sector may have incurred significant drop in earnings in the month of April corresponding with the data from the CBN.

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Research Analysis

Wuse II is most expensive city to cook a pot of Jollof Rice

SBM Intelligence’s Jollof Index reports cost of cooking a pot Jollof Rice in cities across Nigeria.

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Data from Nigerian based research firm SBM Intelligence reveals it now costs N7, 240 on average to make a pot of Jollof rice in Nigeria a 6% rise from the same period in April.

Jollof rice is a staple delicacy in Nigeria and eaten daily by most lower, middle class and upper-class families. It is also a popular delicacy in West Africa.

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According to the report, “the average Jollof Index for the country as at June 2020 was N7,240. This represents a six percent increase from the Q1 2020 figure which obtained when the index was last released in April. Half of the market, mainly in the South East and the South-South (minus Port Harcourt which had the second highest nationally) were below the national average.”

Key Indicators

  • The data is sourced from markets in 13 cities within 9 states in Nigeria with Port Harcourt being the newest city.
  • The report notes a remarkable disparity between the cities reporting Wuse II located in Nigeria’s Federal Capital Territory the highest city for cooking a pot of Jollof Index. It cost N9,300 or 59% more than the lowest, Calabar Municipal.
  • The cost of rice, vegetable oil and turkey – three of the ingredients most impacted by the border closure policy – is the biggest driver of this disparity.
  • The report cites the border closure as the main reason for the spike in the cost of making a pot of Jollof Rice.
  • “A cursory look at the trendline of the Jollof Index will show that by late 2018, it started to decline and maintained this decline into the first quarter of 2019. This changed as the border closure policy was enacted in August 2019 and has been on the rise similar to the recessionary period of 2016 since then. The oil price decline and the COVID-19 pandemic pushed it further between March and May 2020 as prices rose due to the scarcity and increased demand during the lockdown.”

Nigeria has seen a spike in inflation rate in recent months following the government’s policies of border closure and denying forex for most importers. This is part of its program to reduce reliance on imported items particularly food items. A recent bi-weekly research conducted by Nairametrics also reveals significant spike in food prices across markets in Lagos, Nigeria’s commercial capital.

In the Nairametrics report, prices of major household items such as vegetable oil, tomatoes, pepper, rice and several others have once again spiked across major markets. These are all ingredients in making a pot of Jollof rice. The price of a bag of 50kg Mama Gold rice increased marginally by 1.17% to sell for an average of N21,375. Mama’s Pride rice (50kg) also increased marginally by 0.59% to sell for an average of N21,125. A 50kg bag of Foreign rice now sells for an average of N28,500 compared to an initial average of N27,500 indicating a 3.51% increase in price.

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The SBM Intelligence report also reveals rice was the most expensive ingredient in the delicacy. Others were groundnut oil, fish and tomatoes.

  • From an SBM perspective, fish is not a part of the units used for measuring the Jollof Index, but given that the Calabar area is rich in seafood, fish is the preferred protein additive.
  • This increase in the cost of making Jollof rice has made his family reduce the number of times they eat the delicacy. They now substitute with beans, plantain, and garri with soup.

Abuja costliest to cook Jollof Rice

The report indicates Wuse II a major city in the FCT was the most expensive place to cook a pot of Jollof rice. Wuse II is home to most middle class Nigerians living in the capital city Abuja and fast becoming one of the busiest commercial cities in the country.

  • According to the report “A respondent based in Abuja said that during the period of the pandemic, the cost of cooking Jollof rice has doubled. She added that she now uses fish in place of chicken or beef as these protein sources are now out of reach for her.
  • This has reduced the number of times her family eats Jollof rice, and she substitutes spaghetti or beans.

Jollof is cheaper in the South East

The report also indicates it is cheaper to make a pot of Jollof rice in the South-Eastern part of Nigeria. Prices in the South-South and South-East were below the national average.

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  • “In the South-East, a respondent said that over the course of the pandemic, the cost of jollof rice for her family of three has gone up from N1,000 to N2,500. She now substitutes her meal with a local vegetable salad known as abacha.

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Commodities

Economic restrictions in world’s largest economy lowers crude oil prices

Brent crude lost about or 1.62 to trade at $42.04 per barrel.

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global oil market, Bonny Light and Brent crude oil, Arthur Eze, Nigeria cuts crude oil production to 1.77mbpd, Nigeria wants international oil companies to pay up now , OPEC+ deal gets a boost as Russia and Saudi Arabia consider further output cut, 4 key reasons why Brent crude might slip back to $35 per barrel, How substantial is compliance for the Oil market?

Crude oil prices dropped lower on Tuesday amidst worries that new restrictions on businesses in the United States could threaten fuel demand recovery 

Also, expectations that OPEC+ might remove the cap placed on crude oil output from August, in a meeting scheduled for Wednesdayhas sent Brent crude south. 

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Brent crude lost about 1.62% to trade at $42.04 per barrel by 6.25 am local time, after losing about 1% yesterday.    

READ ALSO: Crude oil prices fall lower, oil traders focus on OPEC meeting

Sell-offs in the energy derivative increased pace in the energy market after news filtered in about California’s Governor commanding a massive retrenchment of the state’s reopening, banning indoor restaurants, shutting bars, gyms, hair salons, and closing churches in hardest-hit regions.  

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Quick fact: Brent crude is the leading global benchmark for Atlantic basin crude oils. The international benchmark is used to set the price of crude oil for about two-thirds of the world’s traded crude oil, including Nigeria’s crude (Bonny Light, Brass River, Qua Iboe, etc.). 

READ ALSO: The effect of the United States’ Shale Oil on Nigeria?

Meanwhile, Stephen Innes, Chief Global Market Strategist at AxiCorp, in a note to Nairametrics, spoke about the OPEC scheduled meeting that oil traders are focused on. He said: 

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“Still, speculation on OPEC+ strategy ahead of OPEC’s Joint Ministerial Monitoring Committee meeting tomorrow could make for an exciting 24 hours. 

“Existing plans call for OPEC+ cuts to taper in August after a one-month extension. 

Explore useful research data from Nairametrics on Nairalytics

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“While Russia has already indicated it expects to increase production in line with the agreement, there is the possibility that uncertainty around demand as a result of rising coronavirus infections will lead to another extension of the deepest initial phase of cuts. 

“Traders do not expect the outcome to be hugely significant for oil either way. The most critical deliverable for OPEC+ is the continued demonstration of unity within the group.” 

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