Resort Savings and Loans has shed 38% since a technical suspension placed on the stock was lifted. The stock shed 8.82% in yesterday’s trading to close at ₦0.31.
Year to date, the stock is also down by the same margin.
The Nigerian Stock Exchange had in July 2017 placed the stock on full suspension alongside 16 others for not submitting their financial statements.
The latest numbers
Results for the nine months ended September 30, 2018, shows interest income increased from ₦314 million in 2017 to ₦525 million in 2018. Net loss stood at ₦43 million in 2018, compared to ₦152 million in 2017.
Why the share slide is worrisome
The bank in a notice sent to the Nigerian Stock Exchange (NSE) in March last year announced it had secured a financing agreement with private equity firm, Milost Global. This comprised $100 million in equity and $150 million in debt.
In addition, the firm had secured the commitment of a local investor.
The injection of funds by Milost had, however, been stalled following the technical suspension placed on the stock, for non-submission of its financial statements.
The suspension meant the firm was unable to find a market-based valuation of its shares.
A lower share price means the company would have to issue more shares to new investors. This, in turn, would lead to dilution of existing shareholders.
How low will it go?
The stock could end up trading at the ₦0.20 mark in a few weeks, as there exists no compelling reason for shareholders to take a position.
About the company
Resort Savings & Loans Plc was incorporated in Nigeria on June 17, 1992, as a private Limited Liability Company, with its corporate office at 5th Floor, St. Nicholas House, 6 Catholic Mission Street, Lagos, Nigeria.
The Bank was granted a licence on September 10, 1993, to carry on Mortgage banking. It converted to a public liability company on April 1, 2008, and was listed on the floor of the Nigerian Stock Exchange (NSE) by way of introduction on November 23, 2009.
The principal activities of the firm include the provision of mortgage services, property acquisition management, and fund management.
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