United Bank for Africa Plc (UBA), the pan African financial institution with presence in 20 African countries has announced its unaudited 2018 Third Quarter Financial Results, with impressive growth in Gross Earnings, which berthed at ₦374.8 billion, a 12.3 percent increase when compared to ₦333.9 billion recorded in the corresponding period of 2017.
According to the report filed to the Nigerian Stock Exchange(NSE) on Tuesday, UBA’s net operating improved 1.7 percent year-on-year to ₦227.7 billion, when compared to ₦224 billion achieved in the similar period of 2017.
Amidst inflationary pressures and uncertainties undermining the business environment in Nigeria and a few other countries in Africa, UBA’s operating expenses only increased by 2.3 percent to ₦149.1 billion, compared to ₦145 billion recorded in the same period of last year. The low cost profile can be better appreciated when put in the perspective of double digit inflation rate in Nigeria.
Overall, the Bank posted a Profit Before Tax of ₦79.1 billion whilst Profit After Tax stood at ₦61.7 billion. This profit performance puts the Bank’s annualized return on average equity at 16% and 20% at pre-tax and post-tax profit level respectively.
The Bank continues to maintain a very strong balance sheet, with Total Assets of ₦4.51 trillion, an impressive 10.8 percent year-to-date rise over the ₦4.07 trillion total asset recorded as at December 2017. Another strong indication of the growth of the Bank and more so, acceptance of the franchise across Africa is the remarkable 16.2 percent year-to-date growth in Customer Deposits, which grew to ₦3.18trillion, compared to ₦2.73 trillion as at December 2017.
The shareholders’ fund remained very strong at ₦509.3 billion, even as the implementation of International Financial Reporting Standard (IFRS) 9, moderated the Group’s equity by 3.8% year-to-date.
Commenting on the result, the Group Managing Director/CEO, UBA Plc, Kennedy Uzoka, said; “We achieved a number of strategic imperatives during the quarter and committed more investments in the future of the business – building a solid foundation for sustainable and superior return to our shareholders”
Uzoka said that he is pleased that the Bank’s Virtual Banking Chatbot, Leo, which debuted on Facebook earlier in the year, was successfully launched on WhatsApp during the quarter.
“This new channel offering, which enables our customers to fulfill their banking transactions through simple chat commands, is another premier initiative in our suite. The early pay-offs are quite compelling – recent customer acquisitions and broader transaction volume growth are exciting leading indicators that reinforce our confidence in these novel channels,” he said.
“Our franchise is increasingly renowned for financial solution and I am happy with the consistent growth in our businesses across the continent. We have grown balance sheet by 11% year-to-date to over ₦N4.5 trillion. Notwithstanding the statutory-induced cost growth, our earnings proved resilient, as we recorded nine-month profit before tax of ₦79 billion. Notwithstanding the macro-risk arising from upcoming elections in Nigeria, our single largest market, we are confident of finishing the year strong,” Uzoka concluded.
Also speaking on UBA’s financial performance and position, the Group CFO, Ugo Nwaghodoh said that despite the relative volatility in the third quarter of 2018, especially in the face of U.S. interest rate hikes and concerns over global trade war, which has disrupted the interest and exchange rate environment in many African countries, the bank remains on track to deliver its earnings target for the year.
He said “We remain committed to our five-year plan of working down CIR to 50%, which we consider to be a normalised medium-term CIR. Overall, we closed the third quarter with a post-tax RoAE of 16% and the Group remains well capitalized and liquid, as reflected in the Group’s capital adequacy of 21% and Bank’s liquidity ratio of 53%.”
UBA is one of Africa’s leading banks with operations in 20 African countries. It also has presence in the global financial centres; London, New York and Paris. UBA provides banking services to more than 15 million customers globally, through diverse channels.
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.
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.
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”.
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.
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.
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
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.”
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.
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.
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.
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.
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.
“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.”
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.
MTN expands scope of tower service, targets rural connectivity
The development would also improve cost for future technology evolution and backhaul in the network.
MTN Nigeria Communications Plc has reached an agreement with Global Independent Connect Limited, INT Towers Limited and IHS Towers Limited to expand the scope of their current service agreements, amend the currency conversion provision for tower services.
This was disclosed in a statement issued by the telecommunication firm and published on the website of the Nigerian Stock Exchange.
Chief Executive Officer, MTN Nigeria, Ferdi Moolman, explained that the company is pleased to agree to the mutually beneficial update to its agreements with IHS, adding that the changes would provide clarity for both parties on foreign exchange denomination with Naira payments, while also extending the telco’s relationship into key new areas.
What it means: With the concluded renegotiation of certain terms of its tower agreements, the telco giant can now increase focus on rural connectivity and fibre deployment. The development would also improve cost for future technology evolution and backhaul in the network, which will bear fruit in the longer term while agreeing to move the reference rate for conversions to Naira from the Central Bank of Nigeria’s official rate to the Nigerian Autonomous Foreign Exchange Rate (NAFEX).
Moolman said, “I am particularly excited about the partnership to expand fibre connectivity and deliver accelerated rural telephony. The COVID-19 pandemic has demonstrated the huge importance of digital infrastructure, and these agreements enable us to enhance fibre networks, while rapidly connecting those Nigerians in rural areas that are currently unable to access telecommunications services.”
In 2014, MTN Nigeria took a strategic decision to sell its passive infrastructure (including towers) and focus on its core business. Although the company retains a small number of towers, it currently has agreements in place with a number of tower providers across the country, including IHS.