There are many companies in Nigeria some people may never know are listed on the Nigerian Stock Exchange (NSE). Even though they carry out equally important economic activities like the more popular ones, these companies are often overshadowed by the bigger names, particularly the NSE 30.
Another reason some small-cap companies are not quite popular is because they are not always in the news. Even when they are, they do not ruffle as much feathers as their bigger counterparts.
Despite their relative obscurity, some of these companies have been around for quite a while, carrying out their businesses, making money, expanding operations, and recruiting when the need arises. One of such companies – Livestocks Feeds Plc – is the focus of this week’s Nairametrics company profile.
While UAC of Nigeria plc is generally known to be a household brand in providing consumables (food, snacks and dairies), the company has a subsidiary dedicated to manufacturing healthy and nutritional products for animals.
The subsidiary – Livestock feeds plc – was established in 1963, and has survived almost 60 years producing feeds for poultry, pigs, and cattle. Its products range from Chick mash, Aquamax fish feed, layer mash, grower mash, Broiler starter, Broiler finisher.
Incorporated in 1963, the initial aim of this company was to address the importations of such feed-products into Nigeria by Germans and Dutch.
It started out with its first 5MT/hr was installed in Ikeja, and in subsequent years, a 4MT/Hr mill was installed in Aba, and then 3.5MT/hr installed in Kaduna. Due to population growth and increased urbanisation, there was an increase in the demand for poultry products, directly impacting the demand for feeds. To keep up, the company upgraded the milling output to 10MT/hr automatic machines at Ikeja, Aba and Benin city between 1983 and 1985.
On April 1, 1978, the company was listed on the Nigerian Stock Exchange.
Livestock has further expanded capacity over the years and even explored the Franchise business marketing system during its boom period, when it had more than half of the Nigerian market share for animal feed.
Over the years, the company has modified its business model to compete favourably with new entrants into the market. Livestocks feeds now adds delivery services to its customers, bringing the products (poultry, pig, and cattle rations, meat cubes, and pallets) to them in regular rations or customised rations based on the clients need.
Ownership and management
In the mid to late 90s, Pfizer divested its interest in Livestocks feeds and it was immediately acquired by Adset Limited through an MBO. By the turn of the century, First Capital Trust Limited replaced Adset Limited as the core investor in the revitalised company, and Cashcraft Asset Management became the 2nd largest shareholder.
Adegboyega Adedeji is currently the Managing Director and Chief Executive Officer while the company’s board of directors is headed by Joseph Ibrahim Dada who is the chairman. Abayomi Adeyemi Enitan, and Godwin Abimbola Samuel Esq. as Executive Directors, while Adebolanle Badejo and Daniel Obaseki are non-executive directors.
Focus on the company’s financials
Although the company’s financials is not in the red, shareholders have not had good reasons to smile in recent years. In fact, the company’s financial statement available on the NSE website shows that dividends were last paid in 2015. Since the 2014 financial year, the company has not again declared dividends for shareholders.
Debt to asset ratio as at Q1 2020 was put at 29.75% with total assets of N4.38 billion and Total liabilities of N2.77 billion.
In 2019, Livestocks Feeds Plc total revenue increased to N9,955,222 (N9.9 million) from N7,834,018 (N7.8 million) in 2018. The company also recorded Profit after taxation 106,353 in 2019 as against its loss of 620,311 in 2018.
Though this indicates a gradual improvement in its financials, the company is still far from declaring sufficient profits to declare dividend payout. The year 2020 has also come with a new myriad of challenges, which most businesses did not factor into their plans.
Even large companies may not find it easy declaring dividends for shareholders, so it is even more uncertain for the small-cap companies.
Share capitalisation has remained 1.5 million in the last couple of years, with a total of 2.9 billion (2,999,999,418) units of shares, and total equity of 1,569,592 at the end of 2019.
Has it been all sunshine and roses for Livestocks feeds? Certainly not!
The company has had to re-tweak its model and strategy repeatedly in view of new competitors entering the market. Most of its competition are not listed companies in the NSE, but still manage to capture a small part of the market, completely eroding what was once a near-monopoly for the company.
Olam Group, Premier feed mills, Flour mills Nigeria, and Durante feeds are some of the hundreds of companies that have formed the competition for Livestocks feeds over the years.
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However, there is still a large market out there. Nigeria has not yet attained poultry sufficiency, and statistics claim that over half of Nigerian poultry consumption are still imported. More individuals and businesses are venturing into animal husbandry by the day, and they will need tons of animal feeds to get going.
Livestocks feeds plc is going to need to up its ante, if it hopes to last another 50 years.
MTN shareholders have made approximately N1 trillion since April 2020
Shareholders of MTN Nigeria gained close to a trillion naira in less than 7 months.
MTN Nigeria shareholders have gained N986.58 billion since the first trading session in April 2020.
This was uncovered by calculating the difference in the telecommunication giant’s market capitalization of ₦1.832 trillion at the open of trade, for the first trading session in the month of April 2020, and the market capitalization of ₦2.646 trillion at the close of trade in the first trading session in the month of October.
This gives a whopping N814 billion increase in market capitalization, and this with the dividend the company has paid to shareholders on two occasions between this time period, brings the total gains both realized and unrealized to approximately N1 trillion.
Hence, the N814 billion increase in market capitalization translates to the joint gains MTN investors have made from the increase in the shares of the company, as the share price of the company has increased by 44.44% or ₦40.00 between April 1, 2020, and October 2, 2020, with the share price of increasing from ₦90.00 to ₦130.00.
However, the gains MTN NG investors have made from their investments in the telecommunication company, is not limited to the gains driven by the increase in the price of the shares.
Recall that the company declared payment of dividends to its shareholders on two occasions, as investors/shareholders of the company, whose names appear in the Register of Members, as of the close of business on April 17, 2020 and August 14, 2020 were paid a cumulative dividend per share of ₦8.47, for all the outstanding shares of 20,354,513,050 held by the shareholders, and this translates to a total dividend payout of N171 billion by the company to its shareholders.
It is noteworthy that the realized and unrealized gains MTN investors have made from holding the shares over this period stands at N986.58 billion.
LASACO Assurance Plc Chairman, Aderinola Disu resigns from the Board of Directors
Aderinola Disu resigned her position as a Director on the Board of LASACO Assurance.
Lasaco Assurance Plc has announced the resignation of its former Chairman, Mrs. Aderinola Disu, as a Director on the Board. The resignation took effect from the 8th of September, 2020.
The following information is contained in a press release made available to the public, signed by the company Secretary, Gertrude Olutekunbi, and verified by Nairametrics.
The notification also revealed that, the aforementioned firm has received a provisional approval from the National Insurance Commission (NAICOM) to appoint two other directors.
The two newly appointed directors are; Dr (Mrs.) Maria Olateju Phillips, and Prince Jamiu Adio Saka, both appointed to a Non-Executive Director role.
Profile of the two newly appointed Directors
Chief (Mrs.) Teju Phillips, is a successful Chartered Accountant, who holds an ACCA from England and Wales. She is multilingual and has extensive experience in Management/Consultancy services, that spans across many years in both the public and private sectors. She has served as a Director in Keystone Bank; Director, Lagos State Lottery Board; Honorable Commissioner for Special Duties & Inter-Governmental Relations in Lagos State; Managing Director of Alma Beach Estate Ltd (a subsidiary of Rims Merchant Bank Ltd); Managing Director, Maridot Ventures Ltd. among others.
Prince Jamiu Adio Saka, is an accomplished Insurance professional, having practiced in Canada and Nigeria. He brings to the board over 30 years of experience as a Broker.
Lasaco Assurance Plc, is a listed Nigerian firm that provides life and general insurance services, which includes motor, bond, contractors-all-risk, fire, burglary, aviation, marine, general accident, life, pension schemes, engineering, and oil and gas. The company has a market capitalization of about N2.05 billion and it share price currently trades at N0.28 kobo.
MTN: Data subscriptions triggered surge in Q2 2020 Revenues
Data revenues jumped from N56.7 billion to N79.9 billion in the period under review.
Analysis of the MTN’s results shows that revenues surged, due to increased data usage, aided by the COVID-19 pandemic lockdown.
MTN Nigeria Communications Plc (MTN), reported revenues of N638.1 billion in H1 2020, relative to N566.9 billion recorded in the same period in 2019 – a 12.5% increase.
MTN Plc is Nigeria’s premier provider of connectivity, communication, and collaboration solutions. From the very first phone call, made at Maritime House Apapa, Lagos, Nigeria on May 16th, 2001, MTN Plc has been facilitating connections in Nigeria.
The COVID-19 related lockdown affected businesses worldwide, including businesses in Nigeria. This resulted in most business activities being conducted virtually, in a bid to salvage businesses from collapsing. With social distancing rule, came an increased utilization of online mediums for meetings, weddings, social interactions, and everything that couldn’t be done physically. Consequently, people consumed more data compared with the pre-COVID-19 periods.
According to the latest data available on the NCC website, MTN Plc’s market share of internet subscribers is 42.54%. Its revenue-generating segments include Voice, Data, SMS, Interconnect and Roaming, Handset and Accessories, Digital, Value Added Service, and Other revenues. Aside from SMS, revenues from the other seven segments increased in H1 2020 compared with the previous period last year.
Data revenues jumped from N56.7 billion to N79.9 billion in the period under review. The number of port-out subscribers almost doubles port-in subscribers in the period under consideration, so this does not confound the analysis conducted, which revealed that COVID-19 lockdown boosted data revenues.
The Earnings Per Share (EPS) of the company declined by 4.70% in H1 2020 from N4.89 to N4.66 compared with the same period last year. A 4.68% decline in distributable profit to N94.88 billion in H1 2020, relative to N99.54 billion contributed to this decline in H1 2019.
MTN Plc’s shares were listed on the floor of the NSE on 16th May 2019. The shares currently trade at N129 per unit. The highest price for a unit of share in 52 weeks was N132 and the lowest N90. A total of 51,885,740 units was sold in the last seven days trades. Shares outstanding is 20,354,513,050 units and its market capitalization is N2.63 trillion.
Airtel Africa Plc operates in the same sub-sector as MTN Nigeria Plc – Telecommunications Services. Airtel Africa Plc’s share price is N380. The highest price for a unit of share in 52 weeks was N380 and the lowest N298.90. A total of 15,972 units was sold in the last seven days trades. Shares outstanding is 3,758,151,504 units and its market capitalization is N1,428,097.57 trillion.
On the 30th of September 2020, Telecompaper reported that MTN has added MusicTime playlists to its Ayoba app. MTN’s Ayoba platform and MusicTime announced a partnership deal to bring free music to Ayoba app users. MusicTime in Ayoba is now live in Nigeria and some other African countries, including South Africa and Ghana. The app offers users free access to ten playlists with twenty songs each.
Ayoba is an instant messaging app powered by MTN. With Ayoba, it is possible to chat with anyone, regardless of whether they have the Ayoba app or not. Users who do not have the app, but receive an SMS from an Ayoba user, will be able to respond via SMS, and it will display within the Ayoba user’s chat in the app. Ayoba is available on Android devices (iOS to come later).