Redstar Express Plc may have a new investor taking up a stake in the firm, going by the large volume of trades that took place in yesterday’s trading session at the Nigeria Stock Exchange (NSE).
A total of 60,326,697 shares valued at N271.4 million were traded in 39 deals. This amounts to 10.2% of the company’s outstanding shares. Redstar has 589,496,760 outstanding shares.
NSE rules state that a company must disclose details when transactions involving 5% or more of its issued share capital occur.
Who could be selling?
The company’s audited financial statements for the full year ended March 2018 show that Mohammed Koguna held 33% of the company’s issued share capital in his name and through Koguna Babura Insurance Brokers Limited.
Stanbic nominees hold 25% of the shares (151,257,636) on behalf of various investors.
Bottom line struggles
The company has had a consistent increase in revenue over the last few years but has struggled with its bottom line. Revenue increased from N6.4 billion in 2014 to N8.4 billion in 2017.
Profit before tax rose from N603 million in 2014, dipped to N572 million in 2016, peaked at N653 million in 2017 and then fell to N610 million in 2018.
Profit after tax, however, increased from N403 million in 2014, peaked at N426 million in 2017 and then dropped to N347 million in 2018.
Dividend-wise, there has been a bit more consistency. The company paid a dividend of N0.40 per share for its financial year ending March 2018 (unchanged from the corresponding period in 2017). Dividends have steadily increased over the last decade from N0.20 in 2008 to N0.40 in 2018.
First quarter 2018 results showed a further decline, which would be a cause for worry if it continues all through the year.
About Red Star Express Plc
Redstar Express Plc commenced operations on the 12th of October, 1992 and became a public company on the 9th of July, 2007. It was listed on the Nigerian Stock Exchange in November 2007.
Redstar Express Group includes three subsidiaries – Red Star Freight Limited, Red Star Logistics Limited, and Red Star Support Services Limited. The group engages in courier services, mail management services, freight services, logistics, warehousing, and haulage.
Redstar Express Plc closed at N4.50 in yesterday’s trading session, unchanged from the prior day. Year to date, the stock is down 12.11%.