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Markets

UPDC’s woes may lead to delay of UACN FY 2018 results

A delay in the submission of UPDC results, may leafing to parent company UAC of Nigeria filing its FY 2018 results late.

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United Africa Company of Nigeria Plc

Investors in UAC of Nigeria Plc may have to wait till sometime in May before the group’s full-year audited results will be released.

The company’s financial year ends in December, and companies are expected to submit their statements at most 90 days after or on March 31st 

A subsidiary of the conglomerateUACN Property Development Company (UPDC), has announced a delay in the release of its audited full year 2018 results till the 10th of May 2019. 

Reason for the delay  In a notice sent to the Nigerian Stock Exchange (NSE) yesterday, UAC Property Development Company had indicated that it would file its 2018 audited results sometime in May 2019.  

UPDC’s external auditorsErnst and Young, had indicated that a paragraph on material uncertaintyrelated to going concernwill be included in audit opinion on the company’s 2018 audited results.  

The audit firm is thus required to submit a memorandum to the Financial Reporting Council (FRC) for review, together with the results. The results cant be announced till all accounting issues are resolved by the FRC.  

Why is UACN affected?: UACN is a conglomerate or group of companies. Its subsidiaries have to file their results before it can do the same.  

Other listed subsidiaries had fixed earlier dates for their board meetings.

The board of CAP Plc met on Wednesday the 20th of March 2019 to consider its FY 2018 results.

The board of Livestock Feeds Plc met on the 23rd of March 2019 to consider its FY 2018 results.

Problem child: UPDC’s performance has, in the last few years, been a drag on the overall group performance.

Results for the nine months ended September 30, 2018, show that revenue fell from N3.1 billion in 2017 to N1.7 billion in 2018. The company’s losses worsened from N1.7 billion in 2017 to N4.5 billion in 2019.  

Even more worrying is that loss from continuing operations amounted to N4.6 billion.  

Rescue in the works ?: While UPDC’s results may be dire, key investors in the parent company had moved to take action. In August last year, the company made several board changes.  

Folasope Aiyesimoju was appointed Chief Executive Officer (CEO). Aiyesimoju is the founder of Themis Capital Management, which in April last year, took up a stake in UPDC’s parent company UAC of Nigeria Plc. 

Jaiz bank

Niun Taiwo was also appointed as substantive Chief Operating Officer (COO). Prior to this, she had been Acting Managing Director since May  2017.  

  

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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Market Views

US Stock markets unruffled about disappointing job report

Wall Street was unshaken as it posted record gains at the end of the week despite a disappointing April job report.

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Apple, Microsoft gain over 1%, propels Nasdaq up

The April unemployment survey in the United States was a puzzler by most accounts. The 266,000 additional payrolls were the largest shortfall in economists’ estimates for nonfarm payrolls since the 1990s when many expected 1 million workers to be added to payrolls last month. However, Wall Street was unshaken as it posted record gains at the end of the week.

While analysts warn that the figure is poor, considering how many people have fallen out of the workforce in the past year, the unemployment rate in April remained remarkably stable at 6.1 percent and the market maintained its bullish pace. The Dow Jones Industrial Average (+0.66%) and the S&P 500 index (+0.74%) posted record closes on Friday, as the weak jobs report affirmed views that the Federal Reserve will keep financial conditions easy for longer.

Despite Friday’s gains, large-cap technology stocks are also lagging behind the overall market. For the year, Apple Inc (AAPL.O) is down almost 2%, Amazon.com Inc (AMZN.O) is up less than 2%, and Netflix Inc (NFLX.O) is down 6.5 percent. Overall, the technology market is up 6.8% year to date, less than half of the S&P 500’s 12.6 percent increase (.SPX).

READ: China, US confirm global recovery, capital market stocks are nearing all-time high

Furthermore, value stocks in cyclical sectors like financials, oil, and consumer sectors are soaring. The Russell 1000 Value index (.RLV) has gained 18 percent this year, including 0.7 percent on Friday, while the Russell 1000 Growth index (.RLG) has gained 6.3 percent this year, including 0.6 percent on Friday.

Although some technology stocks rose on Friday after a lacklustre U.S. unemployment report, some portfolio managers believe that recent blowout profits from many major technology firms are insufficient to justify continuing to make large bets on the industry.

The 266,000 new jobs added in April was a significant decrease from the 770,000 new jobs added in March. The rise in April was fueled by employment growth in the leisure and hospitality sector, which gained 330,000 jobs, with more than half of those in restaurants and bars. Overall, the industry employs 2.8 million fewer people than it did prior to the pandemic.

Wide losses in temporary support providers and couriers and messaging services, as well as smaller drops in manufacturing and retail, reversed those gains. Construction employment remained largely stable.

Because of the high liquidity created by the stimulus package and the FED’s decision to keep rates unchanged, the stock market appears to be immune for the time being. The biggest issue on most people’s mind is how long this positive mood will last in the economy.

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Market Views

Top 10 Stockbroking firms in Nigeria for April 2021

The top ten Stockbrokers traded shares worth N111.8 billion in April 2021, accounting for 69.9% of the total amount of shares traded.

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Governor Fayemi explores investment options with the capital market, Nigerian Stock Exchange, Top 10 stockbrokers trade N120.4 billion worth of stocks in November , Law Union & Rock Insurance Plc Announces Notice of Board Meeting and Closed Period, NSE Hosts First Virtual Automated Trading System (ATS) Broker Certification Training Programme, Steroids from GTBANK, ZENITH Lift Nigerian bourse, as investors gain N94.2 billion, Nigerian bourse close flat, triggered by low market liquidity, Industrial index down by 5.7%, as shares of BUA, Lafarge, Dangote, others decline on NSE

The Nigerian Stock market ended the month of March 2021 bullish as the All-Share Index grew by 2.02% from 39,045.13 points recorded as of March 31st, 2021 to close at 39,834.42 points at the end of April 2021.

Meanwhile, the top-performing stockbroking firms in the Nigerian Exchange Group (NGX) traded about 4.89 billion units of shares with a value of N111.8 billion, accounting for 69.9% of the total value of shares traded in the month.

This is according to the Broker performance Report, released by the Nigerian Stock Exchange for the month of April 2021.

According to the report, Morgan Capital Securities led the list of stockbroking firms by volume of shares while Investment One Stockbrokers traded the highest in monetary terms for the period under review.

READ: NSE-30 companies lose N1.13 trillion in market capitalisation year-to-date


Stockbrokers by value

The top ten Stockbrokers were responsible for 69.9% of the total amount of shares traded in April 2021, trading a total of N111.8 billion worth of shares.

  • Investment One Stockbrokers toppled Stanbic IBTC to top the list with trades valued at N60.91 billion in April 2021, representing 38.08% of the total value of shares traded during this period.
  • Rencap Securities stood at second on the list with trades in stocks valued at N15.59 billion, accounting for 9.75% of the total value of shares traded in the month of April.
  • Cardinalstone Securities followed with its total trades valued at N8.45 billion in the period under review. This represents 5.28% of the total value recorded in the Stock Exchange market.
  • EFG Hermes also traded in stocks worth N7.05 billion, to stand fourth on the list as it accounted for 4.41% of the recorded trades in monetary value.
  • Stanbic IBTC Stockbrokers traded a sum of N4.1 billion worth of stocks, which accounted for 2.57% of the total value for the period.
  • Others include Meristem Stockbrokers (N3.87 billion), Chapel Hill Denham (N3.66 billion), Stonex Financial (N3.36 billion), CSL Stockbrokers (N2.53 billion), and Cordros Securities (N2.27 billion).

READ: REVEALED: Three reasons the NSE expelled 38 stockbroking firms in six months


Stockbrokers by volume

The top ten stockbroking firms for the period under review traded in 4.89 billion units of shares, accounting for 45.01% of the total traded stocks.

  • Morgan Capital Securities tops the list of stockbroking firms in terms of volume of shares traded as it recorded trades in 859.82 million units of shares, representing 7.91% of the total volume traded in the bourse for the period.
  • Cardinal Securities followed, having traded in 835.49 million shares, accounting for 7.69% of the total volume of shares traded in April 2021.
  • Investment One Stockbrokers traded in 566.53 million units of shares in the month under review. This represents 5.21% of the total recorded.
  • Meristem Stockbrokers Limited stands fourth on the list with trades in 564.54 million units of shares in April 2021, accounting for 5.19% of the total volume recorded.
  • FBN Quest Securities traded in a total of 449.25 million units of shares accounting for 4.13% of the total volume recorded in the period under review.
  • Others on the list include EFG Hermes (422.23 million), Rencap Securities (406.6 million), Falcon Securities (312.13 million), Stanbic IBTC (248.43 million), and APT Securities (226.28 million).

What you should know

  • The NSE ASI grew by 2.02% in the month of April 2021, bringing the year-to-date performance to a decline of 1.08%.
  • The NSE Banking Index however dipped by 4.76% in the month of April to close at 352.07 points, while the year-to-date growth stood at -10.42%
  • NSE Industrial Goods index grew by 3.06% in the review period.

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