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Company Results

Julius Berger reduces dividend payout to prepare for COVID-19 hit

To prepare for the storm of the COVID-19 induced economic challenge, Julius Berger slashed its dividend to be paid, amongst other cost-cutting measures.

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Julius Berger, Lars Richter, Julius Berger reduces dividend payout to prepare for Covid-19 hit

The global pandemic being faced by the world as we know is set to have major operational implications on businesses across the world and possibly dovetail into a recession.

With predictions of an incoming recession, many businesses and individuals alike have put things in place to prepare for the trying times ahead.

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With the construction industry predicted to experience a major hit, given the halted state of activities, Julius Berger has taken cost-cutting measures to ensure its sustainability.

READ MORE: MTN Nigeria announces final dividend of N4.97 for FY 2019

Following a very good 2019 financial year, Julius Berger had announced a dividend pay-out of ₦2.75K per 50K share for the financial year ended December 31, 2019 and a bonus of 1 (one) new share for every existing 5 (five) shares held.

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However, in an attempt to brace itself for the impending challenges, the board of the company withdrew its previously announced final cash dividend payment of ₦2.75K per 50K share, and instead recommended a final cash dividend pay-out of ₦2.00K per 50k share.

In a corporate action announcement, it revealed that the Board had “carefully considered the emerging social, operational, financial and economic impact of the COVID 19 pandemic, the outlook for Nigeria for the financial year 2020, and the impact on the business and cash flows of the Group.”

It is the company’s way of protecting its liquidity and ensuring long-term sustainability, while balancing the need for returns to shareholders.

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READ ALSO: Dangote Industries targets $30 billion turnover by 2022 

The savings it obtains from the reduced cash dividend of ₦2.00K, as well as its diverse measures to reduce operational and capex costs is to be retained within the business to protect its growth.

Businesses are, at this time, taking necessary actions to ensure business continuity and this is what the company has done. The Group’s financial position is still strong, however, as its Q1 results revealed.

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Consequently, the board remains confident about its future, post-Covid-19.

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Company Results

Conoil Plc declares dividend payment for FY 2019, announces AGM soon

The current share price of the oil marketing firm as of July 9, 2020, is N18.90 per share.

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Conoil Plc, NSE, Conoil Plc's shares, NSE suspends shares from trading shares, Conoil Plc declares dividend payment for FY 2019, announces AGM soon

Oil marketing giant, Conoil Plc, has announced a final dividend payment of N2.00 per ordinary share of 50 kobo each for the period ended December 31, 2019.

The final dividend payment which will be paid to shareholders whose names appear in the Register of Members as at close of business on Monday, July 13, 2020, is, however, subject to the appropriate withholding tax deduction and the approval of the shareholders.

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This information was contained in a notification that was sent by Conoil Plc to the Nigerian Stock Exchange (NSE) on Thursday, July 9, 2020, and signed by its Company Secretary/Legal Adviser, Conrad Eberemu after the release of the full-year audited financial statement for the year ended 2019.

The statement from Conoil says, ‘’A final dividend of 200 kobo per 50 kobo ordinary share, subject to appropriate withholding tax and approval will be paid to shareholders whose names appear in the Register of Members as at the close of business on the Monday, 13th day of July 2020.’’

‘’The Register of Shareholders will be closed from Tuesday, 14th to Friday, 17th July 2020.’’

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(READ MORE: Conoil Plc releases FY financial result for 2019, profit up by 11% )

The corporate actions announcement by the oil firm also states that while the payment date will be on a date to be announced shortly, the dividends will be paid electronically to shareholders whose names appear on the Register of Members as at Monday, July 13, 2020, and who have completed the e-dividend registration with a mandate to the Registrar to pay their dividends directly into their bank accounts.

The oil marketing company also noted that shareholders with dividend warrants and share certificates that have remained unclaimed, or yet to be presented for payment or returned for validation are advised to complete the e-dividend registration or contact the Registrar (Meristem Registrars and Probate Services Limited).

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The company’s Annual General Meeting (AGM) will be held at a venue and date to be announced shortly.

Conoil PLC, in its recently released audited financial statement for full-year 2019 announced a Profit after tax of N1.99 billion as of December 31, 2019. This represented an increase of 11% when compared to the N1.8 billion that was recorded for the corresponding period in 2018.

The profit after tax was recorded on a Revenue of N139.76 billion as of December 31, 2019. This also represents an increase of 14% when compared to the N122.21 billion that was achieved for December 31, 2018.

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The Profit before tax as of December 31, 2019, was N2.78 billion as against the N2.57 billion achieved for the corresponding period in 2018.

The current share price of the oil marketing firm as of July 9, 2020, is N18.90 per share and the earnings per share is N2.77.

 

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Company Results

NSIA records total comprehensive income of N36.15 billion in 2019

The NSIA recorded an increase in total assets to N649.84 billion at the end of the financial year.

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NSIA records total comprehensive income of N36.15 billion in 2019

The Executive Director, Nigeria Sovereign Investment Authority (NSIA), Stella Ojekwe-Onyejeli, announced in a virtual briefing to newsmen on Friday that the NSIA recorded a Total Comprehensive Income (TCI) of N36.1 5 billion in 2019.

She revealed that the 2019 income was less than the TCI for 2018, which was N44.34 billion. However, the NSIA recorded an increase in total assets to N649.84 billion at the end of the financial year, as opposed to that of 2018 which closed at N617.70 billion.

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Ms Ojekwe-Onyejeli said that TCI income for 2019 included foreign exchange gains at N1.26 billion compared to N18.05 billion in 2018, noting that the gain in forex was due to changes in Nigeria’s official exchange rate from N305 to a dollar to N325.

READ MORE: IMF expects Nigeria’s GDP to shrink by 5.4% in 2020

As of year-end 2019, NSIA’s core capital remained at 1.5 billion dollars.” She said. “The Authority continues to manage 3rd party funds on behalf of some government institutions. We currently manage funds for the Debt Management Office (DMO) and the Ministry of Finance.

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“For DMO, the current value of Assets under Management (AuM) is 124.03 million dollars. For 2018, this fund stood at 122.60 million dollars in AuM.

“For the Nigeria Stabilisation Fund, managed on behalf of the Ministry of Finance, the Fund Balance was N33.365 billion. As of 2018, this balance increased to N20.814 billion.”

“However, the National Economic Council voted for an additional capital contribution of 250 million dollars in 2019, which was received on April 8,” she explained.

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READ ALSO: NSIA completes payment of $417 million to NBET Plc

She added that the group’s strategy to invest in diversified products across the yield curve provided returns and that the Stabilisation Fund (SF), which had been fully invested by the end of 2019, returned 5.81%, outperforming its benchmark by 381 basis points.

She also stated that the Future Generations Fund (FGF), deployed by the NSIA across multiple global equities, hedge funds and other diversifiers, returned 6.45% at the end of 2019, outperforming its benchmark of 6.43%.

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“As of year-end 2019, we had deployed over 90 percent of the capital in the Future Generations Fund,” she said.

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Company Results

Sterling Bank’s earnings to remain pressured but valuations still attractive

We project Pre-tax Profit of N9.0bn (down 15% y/y) and we estimate ROAE of 6.9% in 2020e (FY 2019; 9.8%).

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Sterling Bank

Sterling Bank’s Q1 2020 numbers were largely impacted by the regulatory-induced fee cut on e-banking transactions resulting in a decline in Net Fee and Commission (down 16% y/y) and weak operating efficiency given the higher growth in OPEX (up 8% y/y) compared with the increase in operating income (up 3% y/y). Net Interest Margin (NIM) however improved to 7.7% in Q1 2020 (Q1 2019; 7.4%) on the back of lower funding cost (5.1% in Q1 2020 compared with 6.6% in Q1 2019).

READ MORE: How Quidax is Building Africa’s Next Billion-Dollar Crypto Startup

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Sterling bank’s NPL ratio declined to 2.0% in Q1 2020 from 8.9% in Q1 2019 following the declassification of exposures in stressed sectors. We do not expect asset quality issues to crystallise in the short term, as we expect the bulk of the loans in the Oil and gas upstream/midstream (c.27% of gross loan) to be restructured. We however expect earnings to weaken in 2020, due to low asset yields amidst weak loan creation and the downward adjustment in fees on e-banking transactions. We Project Pre-tax Profit of N9.0bn (down 15% y/y) and we estimate ROAE of 6.9% in 2020e (FY 2019; 9.8%).

Following the downward revision to our 2020 earnings forecast, we have revised our target price downwards to N1.67/s from N2.84/s previously. We however maintain our BUY recommendation due to attractive valuations (P/E; 3.7x and P/B; 0.3x) and the 34% upside from the last closing price of N1.25/s. We note that the steep decline in the stock price (down c.37% since the start of the year) presents an attractive entry point.

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