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Company Results

SET Plc recorded N14.4m post-tax loss in Q3 2020

Secure Electronic Technology Plc (SET Plc) recorded a post-tax loss of N14.4 million in Q3 2020.

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Secure Electronic Technology Plc (SET Plc) recorded a post-tax loss of N14.4M in Q3 2020, triggered by a high dealer’s commission. 

A cursory analysis of the Q3 2020 results of Secure Electronic Technology Plc (SET Plc) indicates that the Q3 2020 post-tax loss reduced by 33.7% from N21.7M in the same quarter last year. 

READ: For SET Plc, failure in lottery shifts focus to online gaming

Highlights 

  • Revenue increased by 1.0% 
  • Prizes/winnings increased by 0.52% 
  • Dealers commission increased by 3.42%    
  • Net income decreased by 14.71% 
  • Administrative expenses decreased by 21.21%  
  • Operating loss decreased by 34.62% 
  • Financial charges increased by 68.23% 

READ: MTN: Data subscriptions triggered surge in Q2 2020 Revenues

What you should know

  • A cursory analysis of the latest results of the company reveals that revenues generated from lottery sales and gaming products increased by 1% in Q3 2020 relative to Q3 2019despite COVID-19 pandemic disruptions that have affected revenues of most businesses worldwide.
  • YoY, revenue decreased by 2.15% from N3.18B in 2019 (9-months) relative to N3.11B in 2020 (9-months) – indicating that COVID-19 might have impacted the activities of the company, when considered on a yearly basis.   
  • While the company was able to increase revenues by 1%, reduce its operating loss by 34.62%, and reduce its administrative expenses by 21.21%; high dealers commission and administrative expenses as well as finance charges which increased by 68.23% contributed to the post-tax loss recorded.  
  • Dealers commission and administrative expenses constitute a drag on the company’s profitability. Dealer’s commission was 36.12% of revenues in the period under consideration while prizes/winnings were 60.35%. Administrative expenses was 137.16% of net income in the quarter under consideration. 
  • The post-tax loss is an indication that there was no distributable profit. Thus, the Earnings Per Share (EPS) of the company would be a deficit; so that Q3 2020 EPS was –0.26 kobo.  

READ: Infinity Trust Mortgage Bank Plc suffers 2.21% drop in Q3 revenues

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The shares currently trade at N0.20 per unit. The highest price for a unit of share in 52 weeks was N0.20 and the lowest N0.20, indicating that the share price of the company has been stable. A total of 20,212 units was sold in the last seven days trades. Shares outstanding is 5.63 billion units and its market capitalization as at close of business Friday 16th October 2020 was N1.13 billion. 

Interlinked Technologies Plc operates in the same sub-sector as SET Plc – SpecialityIts share price is N2.91. The highest price for a unit of share in 52 weeks was N2.91 and the lowest N2.91 – indicating that the share price of the company has been stable. A total of 141,020 units was sold in the last seven days trades. Shares outstanding is 236.7 million units and its market capitalization as at close of business Friday 16th October 2020 was N688.80 million 

READ: Pharmaceuticals: Pharma-Deko’s revenue declines by 49.4% in H1 2020

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Background

Secure Electronic Technology Plc (SET Plc), formerly known as National Sports Lottery was incorporated in 2000 with an exclusive 30-year license granted by the FG to operate the National Lottery in Nigeria.

SET Plc started out as a gaming/lottery company. While online gaming remains a major part of its operationsAside from lottery and gaming, the company now explores other business areas within the ambit of technology and data management. 

READ: SAHCO suffers 92% decline in profit, as travel restrictions bite harder

Today, the company is involved in the vending of airtime, provision of card payment solutions, trivia promo syndication, provision of central database and information processing services, as well as treasury/asset management services 

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Company Results

eTRANZACT International Plc records a loss of N72.6 million in 9M 2020.

eTRANZACT International Plc has posted a loss of N72.6 million for the period ended September 2020.

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eTranzact International Plc proposes rights issue, Etranzact International Plc Announces Notice of Board Meeting

eTRANZACT International Plc has posted a loss of N72.6 million for the period ended September 2020 – a 15.3% decline.

This is according to its latest financials sent to the Nigerian Stock Exchange market today.

Key highlights of the 2020 9M financials include:

  • Revenue declined to N5.45 billion, down by -16.1% Y-o-Y.
  • Both Loss Before Tax and Loss After Tax deteriorated to a loss of N72.6 million, up by +15.3%.
  • Cost of sales declined to N5.17 billion, down by -15.3% Y-o-Y.
  • Gross profit declined to N281.7 million, indicating a loss of 28.1% Y-o-Y.
  • Administrative expenses declined to N492.1 million, down by -0.5% Y-o-Y.
  • Investment income declined to N31.33 million, indicating a decrease of -48.4% Y-o-Y.
  • Finance cost decreased to N5 million, down by -42.8% Y-o-Y.
  • Property, plant and equipment increased to N667.9 million, up by +20.1% within the period under view.
  • Total assets grew to N6.95 billion, up by +2.8% within the period under view.

What you should Know

eTRANZACT International Plc has been battling to recover since the scandal that rocked the company in 2018, the same year it posted a loss of N268 million. By Q2 2019, the firm seemed to have overturned the deficit, posting a profit of N96.09 million.

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However, since the beginning of the year, the firm had subsequently recorded a loss in both quarters of the year. These losses seemed to have eroded the gains made by the firm in 2019.

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Business News

Tantalizers suffers loss of N245 million in 2020 9M

Tantalizers suffered a pre-tax loss of N245million between January 1st and September 30th, 2020.

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Tantalizers Plc, a leading fast-food company in Nigeria, has disclosed that it suffered a pre tax loss of N245million between January 1st and September 30th, 2020.

This is according to the information contained in its unaudited financial statement for the period ended 30 September 2020, which was sent to the floor of the Nigerian Stock Exchange today.

Key highlights of its 2020 9M results

  • Revenue was N655.93 million, compared to N1.26 billion it generated same period in 2019.
  • Cost of Sales was N355.44 million, compared to N729.71 million it incurred same period in 2019.
  • Other income was N114.94 million, compared to N268.27 million it made same period in 2019.
  • Administrative Expenses was N606.19 million, compared to N940.90 million it incurred same period in 2019.
  • Operating loss was N189.30 million, compared to operating profit of N127.05 million.
  • Finance cost was N55.70 million, compared to N94.40 million it paid same period in 2019.
  • Loss before tax was N245.00 million, compared to profit after tax of N22.17 million it made same period in 2019.

Operational review

The on-trade-channel of the leading fast-food company with over 60 restaurants across Nigeria as of 30th April, 2017 was severely affected by the COVID-19 pandemic, as the widespread economic vulnerabilities in the nation disrupted the business segment of the company.

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The lockdown and the restriction placed on businesses operating in the on-trade-market affected the on-premise demand and sales of these companies, which led to decline in the sales and net revenue of Tantalizers Plc.

However, the core business segment of Tantalizers was not the only segment affected, as other revenue-generating segments like Rent, advertisement and franchising declined over this period.

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Company Results

Afreximbank’s African commodity index dips by 1% q-o-q in Q3 2020

Afreximbank African Commodity Index for Q3 2020 shows that the composite index fell marginally by 1% q-o-q.

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The recently released Afreximbank African Commodity Index (AACI) for Q3 2020, shows that the composite index fell marginally by 1% q-o-q, mainly on account of price dip in the energy sub-index.

However, the agricultural commodities sub-index emerged the top performer in the quarter; thus, growing more than the gains achieved in base and precious metals.

According to the report, the highlights of the AACI for Q3-2020 are as follows:

  • Energy sub-index fell by 8%, largely as a result of oil price fluctuations.
  • Agricultural commodities sub-index rose by 13%, partly as a result of favorable weather conditions in the major producing countries.
  • Sugar prices gained based on the strong expectations of firm import demand from China and fears that Thailand’s crop could shrink in 2021 following a drought.
  • Cocoa futures enjoyed a pre-election premium in Ghana and Côte d’Ivoire.
  • Cotton rose to its highest level since February 2020, as a result of the threat of Storm Sally on the US cotton harvest, coupled with poor field conditions in the US.
  • Coffee rose by 10% as La Nina weather conditions in Vietnam, the world’s largest producer of Robusta coffee, raised the possibility of a shortage in exports.
  • Base metals sub-index rose by 9%, due to several factors including ongoing supply concerns for copper in Chile and Peru and strong demand in China.
  • Precious metals sub-index rose by 7% in the quarter, as the demand for haven bullion continued in the face of persistent economic challenges triggered by COVID-19 and heightening geopolitical tensions.
  • In addition, Gold enjoyed record inflows into gold-backed exchange-traded funds (ETFs), which offset major weaknesses in jewelry demand.

What they are saying

According to Dr. Hippolyte Fofack, Chief Economist at Afreximbank, “Commodity prices in Q3-2020 have largely been impacted by COVID-19. The pandemic has exposed global demand shifts that have seen the oil industry incur backlogs and agricultural commodity prices dwindle in the first half of the year.

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“The outlook for 2021 is positive — however conservative the markets are. We hope to see an increase in global demand within Q1 2021 and Q2 2021, buoyed by the relaxation of most COVID-19 disruptions and restrictions.”

What you should know

  • AACI is a trade-weighted index designed to track on a quarterly basis, the price movements of 13 different commodities that are of interest to Africa and the Bank.
  • To effectively mitigate risks associated with commodity price volatility, AACI highlights areas requiring pre-emptive measures by the Bank, its key stakeholders and policymakers in its member countries, as well as global institutions interested in the African market.
  • AACI highlights the generally conservative market sentiment with consensus forecasts predicting prices to stay within a tight range in the near term, with the exception of crude oil, coffee, crude palm oil, cobalt, and sugar.
  • African Export-Import Bank (Afreximbank) is a pan-African multilateral financial institution with the mandate of financing and promoting intra-and extra-African trade — owned by African governments, the African Development Bank, and other African multilateral financial institutions, as well as African and non-African public and private investors.

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