Ecobank Transnational Inc. has reported a Profit After Tax (PAT) of N25.6 billion in the fourth quarter of 2020 (Q4, 2020) compared to N20.6 billion recorded in a similar period of 2019, indicating a rise in profit by 24.1% Year-on-Year.
This is according to the firm’s recent financial statement made available on the Nigerian Stock Exchange and seen by Nairametrics.
Ecobank Transnational Inc. had earlier recorded a rise in its interest income by about 11% Y-o-Y, from N125.93 billion as of Q3 2019 to N139.6 billion in Q3 2020. It however dipped in Q4 2020 by 4% from N138.3 billion recorded in Q4 2019 to N132.8 billion.
Other key highlights of Q4 2020 are;
- Net interest income rose to N90.3billion, +19% Y-o-Y.
- Fees and commission income rose to N45.5billion, +7% Y-o-Y.
- Other operating income increased to N13.2 billion, +25% Y-o-Y.
- Operating expenses declined to N106.4 billion, -1% Y-o-Y.
- Profit Before Tax (PBT) declined to N30.9 billion, -16% Y-o-Y.
- Taxation declined to N5.8 billion, -65% Y-o-Y.
- Deposits from customers increased to N7.3 trillion by the end of FY 2020, +23% Y-o-Y.
- Loans and advances to customers increased to N3.7 trillion by the end of FY 2020, +9.4% Y-O-Y.
- Total assets increased to N10.3 trillion by the end of FY 2020, +19% Y-o-Y.
- Total liabilities increased to N9.5 trillion by the end of FY 2020, +19% Y-o-Y.
The increase in the firm’s Profit After Tax (PAT) figures might be attributable to a combination of an increase in income-earning components like; net interest income, fees and commission, etc., coupled with a reduction in expenditure items like operating expenses and tax.
What you should know
- Nairametrics had earlier reported that Ecobank Nigeria had secured a N50 billion 10-Year subordinated loan targeted towards MSMEs.
- A few days ago, Fitch Ratings had assigned Ecobank Nigeria Limited, a Long-Term Issuer Default Rating (IDR) of ‘B’-with a stable outlook and quality management.
- Ecobank Transnational Inc. share price closed at N6.5 on the floor of the Nigeria Stock Exchange gaining 1.56%.
Dangote Sugar yearly revenue surge by 33%, announces a dividend of N1.50
Dangote Sugar Refinery Plc. recently declared a 33.0% Year to year growth in earnings to N29.8 billion for the financial year of 2020
Dangote Sugar Refinery Plc via the Nigerian Stock exchange recently declared a 33.0% Year to year growth in earnings to N29.8 billion for the financial year of 2020
The company also announced a dividend of N1.50 (vs N1.10 total dividend in 2019).
Dangote Sugar’s revenue expanded by 33.0% YoY amid strong volume growth in its 50 kg sugar offering (c.96.0% of total sales).
The company’s impressive outing amazed a significant number of stock pundits despite a surge in tax charges which partially offset some of the positive passthrough from border closures on earnings.
Gross margin expanded by 1.31ppts Year to Year to 25.08%, which we believe points to the effects of recent cost-containment measures and the slump in global raw sugar prices in 2020 amid the COVID-19 pandemic.
The raw sugar price dropped to as low $0.09/lb in 2020 and traded c.$0.13/lb on average during 2020 (-4.38% YoY)
What you should know: Dangote Sugar Refinery Plc (the Company) was incorporated as a Public Limited Liability Company on 4 January 2005, commenced operation on 1 January 2006, and became quoted on the Nigerian Stock Exchange in March 2007. Its current shareholding is 68% by Dangote Industries Limited and 32% by the Nigerian public.
The principal activity of the Group is the refining of raw sugar into edible sugar and the selling of refined sugar. The Group’s products are sold through distributors across the country.
That being said, in spite of such impressive results from the N217 billion valued company experienced a surge in operational cost partly due to persistent FX scarcity.
Dangote Sugar reported a four-fold increase in finance cost, which can be largely attributed to the foreign exchange loss in its ordinary business operations, driven by persistent FX shortages and naira repricing at the exchange rate windows.
Zenith Bank spends N20 billion on IT in 2020, up 122%
Zenith Bank spent a whopping N20 billion on IT in 2020 more than double its 2019 spend of N9 billion.
Nigeria’s largest bank by assets, Zenith Bank Plc, spent a whopping N20 billion on Information Technology in 2020, more than double its 2019 spend of N9 billion.
A cursory view of the bank’s expense line for 2020 reveals that it spent N148.1 billion on other expenses compared with N129. 4 billion in the same period of the previous year. Information technology was the major driver of the bank’s expense line, making up about 15.5% of total operating expenses.
Why this matters: Most banks are expected to record higher spend on information technology in 2020 due to forced work-from-home policies triggered by Covid-19. Apps such as Zoom, and Microsoft Teams went mainstream during the pandemic as most businesses increasingly depended on them to function.
- While remote working may have been a major contributor, the bank likely splurged heavily on software applications, cloud computing, SaaS, and investing in technology to drive its FinTech goals.
- Apart from Information Technology, the bank also spent more on AMCON levy during the year, incurring a cost of N30.9 billion.
- A notable reduction in year-on-year expenditure was its spending on Hotels and Travels. The bank spent N1.8 billion in Travel and Hotels.
- Zenith Bank reported a record N230 billion in profit after tax for the year ended December 2020. The bank is now the largest bank by Total Assets, with over N8.4 trillion.
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