Global Investment Trading Market Daily Updates

2009-11-24T15:37:00.000+01:00

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5th ME Forex Expo & Conference

2009-11-14T03:33:00.002+01:00

The 5th Middle East Forex Trading Expo & Conference will help you to Discover the latest trading techniques, trading tools, signals, news and charting in FOREX trading, Gold, CFD’s, Commodities, Futures, ETF’s, Derivatives and many more. Meet one on one with FOREX experts, strategists, mentors and the most trusted brokers from around the globe

Easy Forex is pleased to announce its participation in the 5th Middle East Forex Trading Expo in Dubai on November 17-18, 2009 and invites all participants to come to booth F23 for a chance to have a personal demonstration of their Visual Trading Machine.

Easy-Forex’s Visual Trading machine provides an exciting, easy and transparent option that helps users make educated, clear decisions in an otherwise complicated market.
Distinctive features of the Easy-Forex platform include:

The Visual Trading Machine which provides a quick display of the most current market information. Each element of the machine is designed to empower the user to make educated decisions about their portfolio of trades, optimizing their trading experience.

Inside Viewer™ allows traders to see through the market with ease and informs them what others on the Easy-Forex platform are trading in real time (popularity of a currency pair, deal direction and the average structure of open deals). This feature brings Easy-Forex to a new standard of ethics in

The unique Trade Controller™ tool which provides a clear and complete picture of all profit/loss scenarios for precision measurement and adjustment. Users with the controls to set their desired values visually and simply.

The Freeze Rate capability enables traders to freeze an existing Buy or Sell rate for a few seconds, allowing traders to briefly lock in a rate regardless of market movement with no commitment to trade.

The Easy-Forex trading platform was founded on the idea of bringing currency trading to the general consumer. Easy-Forex was the first online Forex trading system allowing clients to trade Forex as a consumer product and is one of the only platforms enabling a trader to start trading immediately. Since 2001, Easy-Forex has been revolutionizing foreign exchange trading in more than 150 countries.

The Easy-Forex trading platform was founded on the idea of bringing currency trading to the general consumer. Easy-Forex was the first online Forex trading system allowing clients to trade Forex as a consumer product and is one of the only platforms enabling a trader to start trading immediately. Since 2001, Easy-Forex has been revolutionizing foreign exchange trading in more than 150 countries.

Easy-Forex is licensed in Australia, the EU, and the USA and has nine physical office locations around the world. To find out more, please visit easy-forex.com.

Index declined further despite corporate actions declared.

2009-11-13T07:13:00.000+01:00

Market closed today with a total volume of 323.61 million units exchanged in 6,839 deals, valued at N3.424 billion. The volume traded today was 32.91% below the yesterday trade volume and the transaction value for the day moved downward by 4.53%. The day’s activities chart was driven majorly by the banking stocks such as Platinum bank, Access bank, GTB, Sterling bank and Skye bank as they emerged the top five trades for the day with 29.967 million units, 28.449 million units, 23.527 million units, 18.482 million units and 17.208 million units respectively. The drop recorded in the market today cut across all the sectors with the Food and Beverages sector losing in the lead.

The All-Share Index declined by 0.72% as against 0.70% recorded yesterday and the market capitalisation depreciated by N36.33 billion as against a decline by N34.462 billion of yesterday.NSE-30 lost 0.77% as against 0.25% loss of yesterday, NSE-Food and Beverages reversed to loss by 3.36% as against appreciation of 0.73% of yesterday. NSE-Banking dropped further today by 0.17% against the loss of by 2.13% of yesterday, NSE-Insurance which gained 0.27% yesterday lost 0.60% today and NSE-Oil and Gas against loss of 1.03% of the previous day retained yesterday’s index. At the close of trading today, out of the 124 securities traded, 22 advanced while 42 declined and 60 traded at their previous closed prices.

PZ emerged the highest gainer for day with 4.98% price appreciation, followed by Dangoteflour-4.84%,Unity bank-4.55%, Aiico 4.49%, Abctrans-4.94%,Uniondac-4.48% and Jberger-4.32%

GTB Plc and Japaul lost (5%) each to emerge the highest losers for the day. Other stocks in the category of top ten losers are:ETI-4.97%, Costain-4.96%,Nahco-4.96%, Unilever-4.96%,UPL-4.95%, Eternaloil-4.95%, Bigtreat-4.95% and Agleventis-4.91%.

Asosavings and Abctrans closed on bid today, while Livestock, Capoil, Nahco, Afribank, Firstinland bank, Springbank,Guinnes, Agleventis, Tantalizer, Afrinsure, Prestige, Unicinsure, Wapic, Unionhomes, Crusader, Eternaoil and Academy closed on offer.

Dangote Sugar Plc second quarter report:Turnover declined by 10.28% to close at N38.639b against N43.067b of the previous period.Profit after tax dropped by 43.08% to close at N7.308b as against N12.839b of the previous year.Working capital improved by 4.63% to close at N20.186b as against N19.292b of the previous year and Net Assets grew by 9.52% to close at N35.734b as against N32.627b

Dangote Flourmill Plc audited 2008 audited report: Turnover grew by 13.69% to close atN47.927b as against N42.153b of the previous period. Profit after tax increased by 432.8% to close at N2.989b as against. Net assets increased by 10.73% to close at N24.352b as against N21.985b. Dividend of 30k per share was declared.

Dangote Sugar Plc third quarter report:Turnover dropped by 7.60% to close at N59.440b as against N64.357b.Profit after tax dropped by 35.85% to close at N11.895b as against N18.553b.

PZ Nigeria Plc First quarter report: Turnover grew by 14.65% to close at N18.996b as against N16.568b and Profit after tax declined by 3.9% to close at N545.024m as against N567.401m.

Nestle Nigeria Plc third quarter report:Turnover grew by 32.23% to close at N49.899b as against N37.736b and Profit after tax grew by 31.45% to close at N7.222b as against N5.494b. Dividend of N1.95 was proposed.

Dangote Flourmills Plc third quarter: Turnover growth of 34.77% was recorded to close at N46.953b as against N34.839b of the previous period and Profit after tax grew by 33.16% to close at N7.615b as against N1.758b.30k per share dividend is proposed.

R.T.Briscoe Plc third quarter report:Turnover declined by 18.54% to close at N11.969b as against N14.694b and profit after tax dropped 66.35% to close at N282.681m as against N840.118m of the previous period.

Capital Hotels Plc third quarter report:Turnover grew by 16.91% to close at N3.273b as against N2.797b. Profit after tax also grew by 80.82% to close at N822.006m as against N454.558m.

Oasis Insurance Plc third quarter report: Gross premium grew by 78.64% to close at N780.313m as against N436.800m and profit after tax declined by 179.47% to close at (N96.548m) as against N121.485m.

CBN Gives Banks Deadline on International Standard

2009-11-13T07:08:00.000+01:00

Central Bank of Nigeria (CBN) yesterday said it had given banks till December 2010, to adopt the International Financial Reporting Standard (IFRS) in their accounting system.

The CBN Governor, Mallam Sanusi Lamido Sanusi, said this in a paper entitled, “The Nigerian Banking Sector Reform: Effects on Investment Promotion,” presented at the fourth Negotiation and Conflict Management Group (NCMG) African Summit held in Lagos.

Represented by a Deputy Governor, Mr. Tunde Lemo, Sanusi said the present accounting system of most banks was such that a lot of things are hidden, which analysts will not be able to see.

According to him, adoption of the IFRS and International Standard on Auditing (IAS) would satisfy international benchmark for financial system transparency and boost confidence of foreign investors in the country.

“The enhanced disclosure regime will further reinforce confidence of investors in our banking system. It will aid their evaluation of our financial system’s capacity to efficiently allocate capital, redistribute risks, mobilise savings and promote domestic SMEs investment, which may serve as suppliers to their industrial investments," he said.

Lamido said investors are encouraged when they are assured of ability of the system to adequately deal with corporate malfeasance.

He said CBN is currently addressing the issue of transparency and disclosure, adding that people of questionable character, no matter how rich, would no longer be in control of banks.

He said, “even if you have all the money in the world, even if you are the richest man in Babylon and you do not have integrity and character, you will not be allowed to control any bank in Nigeria.

In addition, Sanusi said the CBN will ensure maintenance of public confidence through enforcement of appropriate disclosure and reinvigorate the policy of zero tolerance on all unprofessional and unethical banking practice.

Banks’ shake up: Finbank recovers 10bn

2009-11-06T02:17:00.000+01:00

The Managing Director of Finbank, Mrs. Susan Iroche, on Wednesday disclosed that the bank had recovered over N10bn, being part of its non-performing marginal loans.

She also stated that to make sure that the situation did not repeat itself, the bank was strengthening its risk management processes.

Iroche noted that her immediate challenge was to ensure that good corporate governance was strictly adhered to, and to create a forum where employees of the bank could communicate directly with management.

The managing director, who spoke in Ilorin when she paid a courtesy visit to the governor, Dr. Bukola Saraki, in company with some executive directors also lauded the efforts of the Central Bank of Nigeria in cleansing the banking system.

She explained that the bank was leveraging in its area of comparative advantage, electronic and retail banking, noting that it was also embarking on cost reduction strategies without compromising quality of its services.

She added that in the short term, the bank was aiming at recovering over N30bn outstanding debts, while promising that the new bank was now “a clean break from the past.”

In his comments, the governor assured the bank of its continued support , just as he appealed to the MD to continue with the support of her bank for small-scale enterprises and the agricultural sector.

Equities reversed to positive outlook by 0.55%

2009-11-06T02:15:00.000+01:00

Market reversed to positive outlook today with the number of gainers increased to 34 while losers reduced to 34 and 62 stocks retained their previous trading prices. This mark of improvement cut across all the sectors with the exception of Oil and Gas sector. The drop recorded in the oil and Gas sector was as a result of the massive sell in the shares of AP and Beco Petroleum as the other stocks in the sector closed at their last trading prices. Market improvement today could be linked to the fact that investors are taking opportunities of the previous days’ decline in prices in anticipation of another price rally. Also, the pronouncement from the CBN of possible injection of liquidity into the economy might be another reason motivating investors to make buys in the market.

All-Share market index advanced today by 0.55% reversing the decline of 0.29% recorded yesterday to close at 21,318.78.Market capitalisation appreciated by N27.41 billion as against the loss of N14.323 billion recorded yesterday to close N5.029 trillion. The NSE-30 gained 0.53% as against loss of 0.12% recorded yesterday, NSE-Banking gained further today by 1.14% as against gain of 0.31% of yesterday, NSE-Food and Beverages gained marginally by 0.07% as against 0.36% of yesterday, NSE-Insurance gained 0.13% as against loss of 1.32% of yesterday and NSE-Oil and Gas lost 0.72% as against loss of 0.76% of the previous trading day.

C AND I Leasing Plc Second quarter result: Turnover for the period grew to N4.077b from N2.382b, a record of 100.05% growth.PAT grew by 29.26% from N217.66 million to N281.326m.Working capital situation in the period dropped by 16.97% from (N5.717b)to (N5.747b) and Net asset improved by 10.73% to close at N2.383b from N2.152b

Standard Alliance Insurance Plc third quarter result: Gross premium rose by 3.54% to close at N2.455b from N2.371b of the previous quarter.PAT for the period recorded a growth of 81.65% to close at N1.673b as against N921.289m of the previous year’s second quarter. Working capital dropped by 16.64% to close at N14.238b from N17.080b and Net assets for the quarter dropped by 8.58% to N21.086b from N23.065b of the previous year’s second quarter .The company made a provision to the tune of N2.897 billion for diminution of investments in the quarter.

Glaxsmithkline Plc third quarter result: Gross earnings rose by 22.54% from N9.281 billion to 11.373b.PAT for the period under review improved by 47.63% from N1.117 to N1.649b.Working capital dropped by 39.06 to(N3.236b) from (N2.327b)of the previous year’s third quarter and Net assets for the period improved by 19.72% to close at N6.526b as against N5.451b of the previous year’s third quarter.

Top gainers for the day were: Unilever(4.99%), NNFM(4.98%), Jberger(4.97%), Diamond bank(4.4.93%), Access(4.92%), CCNN(4.88%), Costain(4.85%), Cutodyins(4.84%), Uniondac(4.76%) and Fidelity bank(4.74%). On the other hand, the following stocks emerged in the class of top ten losers at the close of trading today: Vitafoam(5%), AP and Intercontinental bank each lost (4.98%), Union bank(4.95%), Union Homes(4.93%), Asosavings(4.92%), Cornerstone(4.92%),Presco(4.85%), Oceanic bank(4.83%) and IPWA94.79%)

Goldlink Insurance Plc topped the activity chart today with 185.042 million units valued at N92.521 billion traded in 5 deals. GTB followed with 41.722 million units valued at N672.53 billion, Access bank traded 36.69 million units valued at N228.19 billion,First bank Plc traded 35.989 million valued at N506.37 billion and Aiico insurance Plc traded 34.157 million units valued at N29.672 billion. The total trades of these top five trades accounted for 47.66% of the total market volume.

Nahco, Costain, Nestle, NNFM, Uniondac, Custodyins and Royalex closed on bid today whle Capoil, Presco, Afribank,Intercontinental bank, Platinum habib bank, Interbrew, Wapco, IPWA, PZ, Niwicable, Bigtreat, Vitafoam, Afrinsure, Lawunion, Asosavings, Unionhomes, Crusader and Becopetrol closed on offer

This positive outlook is expected to continue tomorrow barring any unforeseen circumstances that may dampen investors’ confidence again. Also, with the readiness of the CBN to put in place structures for the effective takeoff of the nations asset management company, which analysts have noted as necessary for market recovery, market may persist on the positive note in the days ahead.

WDAS: CBN scales down Forex

2009-11-04T12:13:00.000+01:00

The Central Bank of Nigeria last week scaled down its foreign exchange supply in the Wholesale Dutch Auction System from $200m to $62.9m.

The amount was sold to only 16 banks that participated in the auction, while the $200m sold at the previous auctions were sold to higher number of participants ranging from 19 to 22.

In spite of the reduction, the naira still maintained its firm position of N149.14 against the United States dollar as in the last three auctions.

It, however, depreciated against the pound sterling and the euro where it exchanged for N246.58 and N220.78 respectively.

At the previous auction, the local currency exchanged for N245.56 against the pound sterling and N219.71 against the euro.

Dealers said the reduction in the number of participants in the auction as well as the reduction in supply might not be unconnected with the influx of forex into the inter-bank market where liquidity has been largely boosted by the Federal Government stimulus, intervention by oil firms and the Nigerian National Petroleum Corporation, as well as the bail-out package from the government.

Traders said on Friday that the inter-bank lending rates remained at 4.25 per cent on average as liquidity from previous cash inflows was enough to meet weak credit demand from borrowing banks.

The secured Open Buy Back, overnight and call money rates were unchanged at four per cent, 4.25 per cent and 4.5 per cent respectively, in spite of investments in Treasury Bills and forex purchases in the week to Friday.

According to one of the dealers, ”There were few cash outflows into Treasury Bills worth about N45bn and payments for forex purchases at the CBN‘s WDAS, but the funds in the system were sufficient to meet demand for credit.”

They said the impact of the billions of naira injected into the system as part of a government stimulus package and bail-out of undercapitalised banks remained dominant in the system.

”Most banks have sufficient liquidity to meet their inter-bank obligations,” another banker said.

The cost of borrowing among banks slipped to 4.25 per cent on average two weeks ago from 4.91 per cent the previous week after large cash inflows from a $2bn economic stimulus package and the release of October budgetary allocations to the three tiers of government.

Dealers said the rates could climb gradually this week, but increases were likely to remain minimal given that cash balances in banks‘ books remain strong.

First Bank Nigeria Releases Results

2009-11-04T12:10:00.000+01:00

FirstBank Nigeria Plc has a few minutes ago released its results on the floor of the Nigerian Stock Exchange.

Visit FIRSTBANK IR page here to view results.

Stock Exchange records over ₦86 billion loss in October

2009-11-04T12:09:00.000+01:00

Trading activities at the Nigerian Stock Exchange in the month of October were characterised by losses as market indicators continued their bearish trend.

Over N86 billion was lost during the month with the market capitalisation closing at N5.144 trillion on the last trading day of the month, after it opened on the first day at N5.230 trillion. The market capitalisation rose to N5.435 trillion in the second week before dipping due to the slow pace of activities witnessed in all sectors quoted at the exchange.

The Exchange's All-Share Index which opened at the beginning of month with 22,497.27 basis points declined by 3.08 per cent or 692.58 units to close at 21,804.69. Also, two of the four stock exchange sectoral indices depreciated at the end of October - the Banking Index lost 4.05 per cent while the Insurance Index lost 4.74 per cent. However, the Food/Beverages Index gained 5.13 per cent at the end of the month while the Oil/Gas Index was up 7.65 per cent.

Investors shy away

Analysts have attributed the low turnover recorded during the period in review to the ongoing reforms in the banking sector.

Tunde Oladapo, chief executive officer of StockPicks Consulting Limited, said "Real investors (long term investors) are shying away from the market presently. They are holding on to cash. But generally, if you compare the volume of stocks being offloaded on the floor of the exchange now with the previous months, it's obvious that investors' confidence is building up gradually even though it's on a slow pace and may not be absolute any time soon."

However, Mr. Oladapo believes the capital market will stabilise from next year, because "the Central Bank of Nigeria has done its worst". He forecasts an oscillating market in the remaining two months, saying, "Fund managers will be buying and selling. No significant rebound will happen until next year."

Effect of suspension

In the aftermath of the newly released stress audit result by the Central Bank on October 2, which showed that four additional banks were in a "grave situation," the management of the stock exchange, on October 5, placed a one-week technical suspension on the shares of BankPHB and Springbank while it took no action on Wema Bank. The fourth bank, Equitorial Trust Bank, is not a publicly quoted company, therefore, the stock exchange could not take any action on it.

The technical suspension, which means that trading will be allowed on the stocks but their prices cannot move up or down, was aimed at restricting the dumping of the shares of those banks to avoid a free fall on their prices.

However, the one-week suspension still affected the performance of the banking sector, a major driver of the exchange's turnover volume, forcing it to decline to 1.45 billion shares from 2.02 billion recorded before the action. But, in spite of the crisis in the banking sector, it maintained its position as the most active in terms of volume.

Though the suspension was lifted on October 13, the share prices of BankPHB and Springbank have continued to decline by 35 and 47 per cent respectively since then. On the contrary, the shares of the two other "troubled" banks - Wema Bank and Unity Bank - have retained their prices.

Afribank assures customers of excellent services

2009-11-04T12:07:00.000+01:00

Afribank Nigeria Plc has assured customers, participants and exhibitors at the forthcoming 2009 Lagos International Trade Fair of its excellent traditional banking.

The bank will put up a full-fledged branch at the fair to enable it to offer full banking transactions at the fair.

A statement on Saturday said the bank had provided full banking facilities to enable participants to enjoy its wide range of services within the fair ground. It will also offer customised services to traders, businessmen and women and corporate account holders at the fair ground.

The statement added that the bank‘s online real time services would be on hand to enable customers across the country to deposit, transfer and withdraw funds with ease.

Other banking services such as cash collection, opening of accounts at concessionary terms, draft issuance, sale of educational forms, receipt of payment for taxes and free financial advisory services will also be available at the bank‘s stand.

The statement said that subsidiaries of the bank would also be at the fair to offer free financial advisory services on pension management, insurance brokerage, assets and property management, trustees and investment and stock brokerage.

It added that the services of the bank would be available to both institutional and individual customers at the corporate banking, retail, consumer and commercial banking customers‘ desks at the bank‘s stand.

Plans have also been concluded to offer free medical checkup such as weight measurement; body temperature, use of the massaging machine and blood pressure checks at the pavilion.

Ecobank extends free micro funding to ‘enterprising Nigerians’

2009-11-04T12:02:00.000+01:00

Ecobank Nigeria Plc has extended free micro-funding to enterprising Nigerians as it unveils the second phase of The Entrepreneur.

A statement from the bank on Saturday said registration of prospective participants for the ‘Season 2’ of the business reality television show, The Entrepreneur, had commenced in all branches of Ecobank nationwide.

The programme provides micro-entrepreneurs with brilliant ideas the opportunity to access up to N15m free micro-funding from the bank.

The main objective of The Entrepreneur, according to the statement, is to empower small business owners, promote entrepreneurship through investment in innovative social enterprises, educate people on the numerous strategies of pitching business ideas, and contribute to poverty alleviation in the society.

The TV series, which made its debut last year, injected over N12m into the businesses of 23 micro-entrepreneur winners.

Co-sponsored by the malt drink, Vitamalt, the programme has been endorsed by notable government and private sector organisations, which include the Federal Ministry of Agriculture and Water Resources, Growing Businesses Foundation and the Small and Medium Enterprises Development Agency of Nigeria as key partners.

The statement said, “In Season 2, The Entrepreneur TV series seeks to focus on encouraging Nigerians to engage in the real sector of the economy. Bright ideas in the areas of commerce and industry, agriculture, and health are sought, as well as innovative approaches to issues of food security and value-added farming.”

It quoted the Minister of Agriculture and Water Resources, Dr. Sayyad Abba Ruma, as saying that it was a forward looking initiative that would help promote entrepreneurship in agriculture, thereby creating jobs and wealth for Nigeria.

It said, “Interested participants who wish to harness this opportunity and become successful entrepreneurs will be able to do so by picking up their forms at any Ecobank branch nationwide, or downloading the forms online.

“The zonal auditioning for registered participants will hold in Abuja, Enugu and Lagos to select participants with the brightest ideas who will face the panel of judges in the finals in Lagos.”

FOREX UPDATES

2009-10-31T17:51:00.000+01:00

Forex Update
Euro / Dollar Technical Forex Analysis for Forex Traders
In agreement with the negative technical outlook we talked about in the past two days, the Euro stopped at the first resistance in the report 1.4844 with great accuracy (highest price after the issuance of the report is 1.4840), then dropped breaking the support 1.4801, and reached the first target of that break 1.4702. And after reaching 1.4702, we should not neglect the rising probability of an upward correction for the drop from 1.5061, which reached almost 400 pips so far.

USD / JPY Technical Forex Analysis for Forex Traders
Dollar-Yen broke 90.76 and had some drop after that, but it stopped before 90. In spite of that, the technical outlook became more negative, because we broke the rising channel that we have been monitoring lately. The most important support for the short-term is 90.16, and until this moment it managed to hold above it.

Weekly Market Update (301009) - Weak Earnings Reports and Loss of Confidence Caused Index Drop.

2009-10-31T16:34:00.000+01:00

Market this week performed below the previous week performance as all indicators went southward. Market index was on consistent decline since the first trading day of the week throughout the week without a break. For instance, from the 0.28% index gain recorded last trading day of the previous week, the week reversed the trend with a loss of 1.24% in index and loss of N66.175 billion in Market Capitalisation on Monday. This gloomy outlook of the market was caused by a mixture of profit taking and loss of confidence, most especially in Banking sector. The sector recorded the highest loss in the week. However, Food and Beverages sector recorded the best performance in the week with Flourmill being the major driver of the sector’s impressive performance.

The NSE-All share index in the course of the week dropped by 3.75% to close at 21,804.69 as against increase of 1.61% which closed at 22,653.17. The drop was attributed to the decline in the prices of highly capitalised equities. The market capitalisation of 198 First-Tier equities closed lower at N5.14 trillion as against N5.34 trillion of the previous week and the NSE-30 index dropped by 3.02% to close at 837.34 as against gain of 2.60% recorded last week to close at 863.38. One of the four indices appreciated-NSE-Food and Beverages rose by 2.02% to close at 484.99 as against 2.56% gain recorded last week, the NSE-Banking declined by 4.23% as against appreciation by 1.30% of the previous week, the NSE-Oil and Gas declined by 2.02% as against gain of 5.95% recorded last week

A total of 1.95 billion units of shares worth N11.4 billion was exchanged in 30,579 deals in the week as against 2.102 billion units of shares worth N15.780 billion in 29,101 deals recorded last week. The banking sector recorded the highest traded volume for the week with a total of 902.73 million shares worth N6.8 billion was exchanged by investors in 16,935 deals in the week as against 1.305 billion units exchanged in 16,795 deals valued at N10.419 billion of last week. Volume in the banking sector was largely driven by activities in the shares of FCMB, UBA and Access Bank Plc just as of last week. Trading in these three banks accounted for 41.9% of the sector’s trade as against 50.13% of the previous week. In the same vein, the activity in the shares of Standard Alliance Insurance Plc and Lasaco Insurance followed with a turnover of 493.42 million units valued at N390 million in 2,685 deals.

On the price movement during the week, Sixteen(16) stocks advanced in price movement during the week which was below Forty Two (42) advancers recorded in the previous week. Flourmill in the Food and Beverages sector as in the preceding week led the gainers’ chart for the week with N6.79 as aginst N6.03 of the previous week, followed by Guinness Plc(N4.14), Julius Berger (N1.34), UAC (N0.50) and CCNN (N0.49). Other price gainers in the top ten category include: UPL(N0.45), Longman(N0.41), Ashakacem(N0.35), Berger Paints (N0.31) and Fidson (N0.25).
On the losers’ side, Seventy Two(72) decliners were recorded in the week against Seventy Two(55) decliners of the previous week. Nigerian Breweries Plc in the Breweries sector led the losers’ chart with N4.50 drop in the week. Next to it are Conoil(N3.98), UACN(N2.08),AP(N1.80), WAPCO(N1.55), NBC(N1.11), Eternal Oil(N1.09), Nahco(N1.09), Ecobank(97k) and Skye Bank(80)
During the week, Nigerian Ropes Plc was adjusted for dividend of 8k per share, Adswitch Plc was adjusted for dividend of 4k per share and Custodian and Allied Insurance Plc was adjusted for an interim dividend of 5k per share.

TECHNICAL SUSPENSION
The full suspension on Stokvis Nigeria Plc and African Paints (Nig) Plc was down graded to technical suspension on Thursday, October 29, 2009.

MEMORANDUM QUOTATIONS
NIGERIAN INTERNATIONAL GROWTH FUND: Unaudited result for the first quarter ended 30th September 2009 shows Total Income of N251.5 million and Total Expenses of N62.1 million. The Net Assets at the end of the period stood at N2, 840.35 million.

REPORT ON THE OTC MARKET FOR FGN BONDS
A turnover of 408.8 million units worth N N502,043.24 million in 4,667 deals was recorded this week, in contrast to a total of 482.04 million units valued at N588,776.5 million exchanged in 5,681 deals during the week ended Thursday, October 22, 2009. As in the preceding week, the most active bond (measured by turnover volume) was the 6th FGN Bond 2029 Series 3 with a traded volume of 77.6 million units valued at N107,457 million in 730 deals. This was followed by the 5th FGN Bond 2013 Series 1 with a traded volume of 46.94 million units valued at N50,844.34 million in 434 deals. Nineteen (19) of the available thirty - seven (37) FGN Bonds were traded during the week, compared to twenty–one (21) in the preceding week.

RESULTS RELEASED DURING THE WEEK:

Berger Paints Plc Second Quarter Result released reported Turnover drop of 11.82%, PAT dropped by 29.60%, Working Capital declined by 6.90% and slight increase of 0.74% in Net Asset.
Transcorp Plc Audited Account for the year ended, 30th September 2009 reported Turnover growth of 23.83%, PAT growth of 114.37%, Working Capital growth of 101.31% and 20.43% growth in Net Assets. The result is a boost to investors’ confidence.

Skye Bank Plc Fourth Quarter Results: The turnover grew by 35.96% from N74.615 billion to N101.448 billion. However, the PAT dipped by 187.68% from N15.126 billion to (N13.263 billion).There was drop of 7.41% in Net Assets for the period to close at N86.901 billion from N93.853 billion. Working Capital situation improved by 41.77% from (N481.063 billion) to (N280.138 billion)

Sterling Bank Fourth Quarter Result: Gross Earnings grew by 4.04% from N36.30 billion to N37.768 billion. PAT dipped by 169.63% from N6.583 billion to (N4.584 billion). Net Asset for the period dipped by 4.48% from N31.272 billion to N29.868 billion and Working Capital situation declined further by 82.83% from (N50.09 billion) to (N91.6 billion).

Ecobank Transnational Plc Third Quarter Result: Gross Earnings grew by 31.35% from N96.961 billion to N127.354 billion. PAT dipped by 24.82% from N12.222 billion to N9.189 billion. Net Asset for the period grew by 12% from N144.174 billion to N161.621 billion and Working Capital dropped by 41.21% from N51.696 billion to N27.291 billion

NCR Plc First Quarter Result: Turnover dropped by 22.27% from N4.310 billion to N3.350 billion. PAT increased by 520% from (N155.521 million) to N651.408 million. Net Asset for the period grew by 128.71% from (N505.497 million) to N145.911 million and Working Capital increased by 224.22% from N294.524 million to N954.524 million.

Academy Plc First Quarter Result: Turnover dropped by 39.47% from N412.862 million to N575.800 million. PAT increased by 314.72% from N9.350 million to N38.776 million. Net Asset for the period grew by 7.35% from N463.152 million to N497.201 million and Working Capital increased by 6.55% from N139.526 million to N148.661 million.

Access Bank Plc Second Quarter Result: Turnover grew by 30.77% from N64.326 billion to N49.189 billion. PAT dipped by 227.99% from N9.187 billion to (N11.758 billion). Net Asset for the period declined by 12.29% from N184.159 billion to N161.535 billion and Working Capital situation improved by 9.41% from (N256.883 billion) to (N232.714 billion).

Tantalizer Plc Third Quarter Result: Turnover grew by 23.82% from N3.279 billion to N4.060 billion . PAT rose by 5.89% from N225.213 million to N238.479 million. Net Asset for the period increased by 1.56% from N3.768 million to N3.827 million and Working Capital situation improved by 92.91% from (N129.941 million) to (N9.219 million).

Asosavings and Loans Plc First Quarter Result: Turnover declined by 3.72% from N2.419 billion to N2.329 billion . PAT came down by 68.62% from N674.583 million to N211.669 million. Net Asset for the period increased by 7.74% from N5.477 billion to N5.901 billion.

Fidelity Bank Plc First Quarter Result: Turnover grew by 33.12% from N13.939 billion to N18.555 billion . PAT declined by 24.83% from N3.024 billion to N2.273 billion. Net Asset for the period decreased by 5.18% from N138.888 billion to N131.693 billion and Working Capital situation improved by 14.12% from (N125.359 billion) to (N107.660 billion).

Northern Nigerian Flourmill Plc Second Quarter Result: Turnover grew by 14.18% from N4.694 billion to N5.360 billion . PAT grew by 337.24% from N75.179 million to N328.709 million. Net Asset for the period increased by 31.33% from N865.169 million to N1.136 billion and Working Capital situation improved by 55.86% from N888.45 million to N1.384 billion.

Benue Cement Company Plc Third Quarter Result: Turnover grew by 177.28% from N9.819 billion to N27.226 billion . PAT grew by 209.06% from N4.196 billion to N12.968 billion.
Capital Oil Plc Audited Account for the Year Ended 2008: Turnover grew by 17.13% from N219.93 million to N257.6 million . PAT grew by 337.24% from N0.27 million to N39.41 million.

Access Bank Plc - Unaudited results for the 6 month period ended 30 September 2009

2009-10-31T16:32:00.000+01:00

ACCESS BANK PLC REPORTS 31% INCREASE IN REVENUES FOR THE 6 MONTH ENDED 30 SEPTEMBER 2009 TO N64 BILLION

LAGOS, NIGERIA – 30 October 2009 – Access Bank Plc, (Bloomberg: ACCESS NL) (“Access Bank” or the “Bank”), the full service commercial bank headquartered in Nigeria and with operations across eight African countries and in the United Kingdom announces its unaudited results for the 6 month period ended 30 September 2009.

Access Bank remains focused on building market share and leveraging its lean value chain driven business model to deliver quality service to our target market. We have continued to take the necessary actions to maintain strong capital adequacy ratios and grow our funding base and liquidity levels well beyond the prescribed regulatory minimum. The strength of our business model is evident given our 34% year on year growth in operating profits. Although our bottom line earnings for the 6 month reporting period have been significantly impacted by a N30.9billion exceptional provision resulting from the recently concluded joint CBN/NDIC special examination, we have since commenced the necessary recovery and remedial actions to regularize a significant portion of the classified loans. We are cautiously optimistic that we will record performance improvements over the next quarter.

Financial Highlights

· Gross Earnings of N64.0 billion, an increase of 31%, compared with the equivalent period in the prior year (N49.2 billion Sept 2008)
· Operating cost / operating income ratio down to 51%, (53% Sept 2008)
· Operating profit of N21.5 billion, an increase of 34% (N16.0 billion Sept 2008)
· Exceptional provision for risk assets of N30.9 billion
· Notwithstanding provisions, Bank’s capital adequacy ratio stands at 25.3%
· Loss After Tax of N11.8 billion, compared with a profit of N9.2 billion Sept 2008
· Loans & Advances down 12% to N383.2 billion (N432.7 billion Sept 2008)
· Deposits and other accounts up 22% to N381.3 billion (N311.4 billion Sept 2008)
· Loan to deposit ratio improved to 99% (138% Sept 2008)
· Liquidity ratio of 33.5% (8.5% above the regulatory minimum of 25%).

MARKET RECORDED 0.975% NEGATIVE OUTLOOK

2009-10-23T14:35:00.000+01:00

All-Share market index today lost 0.975% and market capitalization dropped by N52.349 billion. The NSE-30 Index declined by 0.023%, NSE-Food &Beverages lost 0.598%, NSE-Banking lost 1.576%, NSE-Insurance declined by 0.326%, while NSE-Oil &Gas gained 0.720%. The index movement in the entire market for the day showed 22,758.77 maximum, 22,525.62 average and 22,293.53 lowest.

One Hundred and Twenty Three (123) stocks were traded in the market today out of which Twenty Four (24) advanced, Forty-One (41) declined and Fifty Eight (58) traded at their previous closed prices.

The top ten gainers today were: AP Plc, UACN Plc, Flourmill Plc, Wapco Plc, Diamond Bank Plc, Ashakacem Plc, UPL Plc, Dangflour Plc, Starcomms Plc and Intercontinental Bank Plc with gains of 159k, 150k, 125k, 48k, 29k, 24k,21k,15k,9k and 9k respectively.

The top ten losers on the other hand were: Nestle Plc, Guinness Plc, Honeyflour Plc, Rtbriscoe Plc, Nahco Plc, Union Bank Plc, CCNN , ETI and FCMB; they lost 499k, 314k, 170k, 42k, 39k, 35k,32k,30k, 29k and 21k in that sequence.

The top five most traded sectors were: Banking with a total volume of 208.794 million units (about 50.40% of the entire market volume) exchanged in 3,334 deals, valued at N1.764 billion, Insurance sector followed with 158.085 million units traded( 38.17% of the market volume), Food &Beverages sector traded 12.784 million units (3.09% of the market volume), Petroleum Marketing traded 8.129 million units (1.96% of the market volume) and Building Materials traded 3.251 million units (0.785% of the entire market volume).

The ten most traded stock for today were Goldinsure Plc-81.937 million units, IAINSURE- 64.957 million units, UBA-42.127 million units, Diamond Bank-27.516 million units, FCMB-22.727 million units, First Bank-19.179 million units, Skye Bank-16.844 million units, Firstinland Bank-16.798 million units, Zenith Bank-11.426 million units and Fidelity bank- 11.198 million units..

Livestock Plc, Courtville, AP and UPL closed on bid. However FTN Cocoa, Nahco, Rtbriscoe, Spring Bank, Guinness, Afromedia, PZ, Honyflour, Nestle, Lasaco, Nigerins, Stdinsure, Wapic, Daarcomm, Crusader, Bagco, Becopetrol, UAC-Prop and UNTL closed on Offer.

RESULTS RELEASED TODAY:

BAGCO PLC FIRST QUARTER RESULTS:

When compared with the previous year first quarter result, Bagco Plc recorded 3.72% increase in its turnover, 28.80% decline in its Profit After Tax, 3.14% decline in its Fixed Assets, 7.46% increase in its working capital and 1.88% in its Net Assets.

NIGERIA WIRE&CABLE PLC HALF YEAR RESULT:

The turnover for the period increased by 24%, Profit After Tax also rose unusually by 724.67%. There was increase of 7.92% on the Fixed Assets, a drop of 13.86% in the company’s working capital and improvement of 4.77% on the Net Assets in the period.

ZENITH BANK FOURTH QUARTER RESULT:

The turnover for the period increased by 19.42%, Profit After Tax declined by 53.20%, Fixed Assets increased by 48.06%, Working Capital declined by 3.53% and Net Asset declined by 3.52%

Forex market Updates

2009-10-23T14:29:00.000+01:00

Forex: EUR/USD finds resistance at 1.5050

FXstreet.com (Barcelona) – The Euro's recovery against the Dollar from MA55 hourly at 1.4990 has found resistance at 1.5050 in the European session with the pair sliding to trade close to 1.5030. Currently the pair is trading around 1.5025/35, at the same zone of opening price action.

Next resistance area, at the moment, lies at 1.5060 (session high), and above here, 1.5085 (Aug 11 08 high) and 1.5100. On the downside, support levels at 1.4990/00 (session low/ oct 20 high), and below here 1.4975 and 1.4940 (Oct 22low).

George Antonakos, analyst at FXGreece, comments: “Our lower targets were achieved during yesterday’s highs, but retracements remained weak, indicating that buyers still dominate. Important resistance emerges at 1,5100 area, which is the most possible target. As you can see in the daily chart two different channels are met at these levels and these levels should not be easily breached. Next targets are set at 1,5160-80, but if these levels are reached, a move to higher levels with next target at 1,5250-00 area. Important support emerges at 1,4965-80 area, followed by 1,4830-50 area.”

Forex: USD/JPY finds support at 91.50 and approaches to 92.00

FXstreet.com (Barcelona) – The Dollar has bounced at 91.50, coming from its 40 pips decline from 91.90, to rise above previous highs at 91.90 and tests 92.00 level. Currently the pair is trading around 91.85/95, 0.70% above today's opening price action at 91.30.

According to Peter Rosentreich, technical analyst at ACM - Advanced Currency Markets, The Dollar could go through a corrective decline after topping at 91.90: "91.95 has so far provided decent supply to cap further rallies today. First resistance comes in at 91.10, we would look to buy around 90.20, with support below at 89.70."

George Clement, analyst at Swiss e trade, comments: “The Dollar continued its strength against the Yen in early European trading, right now at 91.55 after highs around 91.91. We see the upside potential rather limited for today's trading.”

Conference Bd: Sep US Leading Index Up 1.0%, Above Expectations

2009-10-22T17:58:00.001+01:00

Dow Jones | Thu, Oct 22 2009, 14:00 GMT
The index of leading economic indicators rose for the sixth consecutive month in September. The leading index increased 1.0% last month, after a revised 0.4% gain in August, the Conference Board reported Thursday. August's gain was originally reported as 0.6%.

Economists surveyed by Dow Jones Newswires had expected an increase of 0.8% in the September index.

"The LEI has risen for six consecutive months and the coincident economic index has increased in two of the last three months. These numbers strongly suggest that a recovery is developing," said Ken Goldstein, economist at the board. "However, the intensity of that recovery will depend on how much, and how soon, demand picks up."

Eight of the 10 leading indicators increased in September. The most positive were the interest rate spread, consumer expectations and the inverted trend in jobless claims. The negative contributors were weekly manufacturing hours and building permits.

The coincident index was unchanged in September after rising a revised 0.1% in August, which was originally reported as unchanged.

The lagging index dropped 0.3% last month, after a revised 0.2% fall in August that was first reported as a 0.1% drop.

-By Kathleen Madigan, Dow Jones Newswires; 212-416-2466; kathleen.madigan@dowjones.com

Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=4x5ks2bV7EdKor3uWxlUEg%3D%3D. You can use this link on the day this article is published and the following day.

(END) Dow Jones Newswires

Forex: USD/JPY falls to 91.30 after reaching 1-month high at 91.71, Thu, Oct 22 2009, 16:40 GMT

2009-10-22T17:54:00.000+01:00

FXstreet.com (Barcelona) – The Dollar's advances against the Yen from 91.10 has been capped at 91.71, fresh 1-month high, during the American session with the pair sliding to trade close to 91.30. Currently the pair is trading around 91.35/45, 0.45% above today's opening price action at 91.00.

The FastBrokers Research Team comments: “Meanwhile, all eyes will be on tomorrow’s wave of EU and British econ data long with continued Q3 results. The USD/JPY’s correlation with U.S. equities it’s a bit out of whack these days. However, any broad-based favoritism of the risk trade would likely benefit the USD/JPY’s uptrend. Considering the GBP/USD and EUR/USD have limited topside technical barriers, the USD/JPY’s present run could have more room to go over the near-term.”

FastBrokers provides us with her levels: “Resistances: 91.76, 91.90, 92.03, 92.18, 92.38, 92.51. Supports: 91.38, 91.26, 91.16, 90.85, 90.67.”

Bank crisis: Senate may propose splitting CBN’s functions

2009-10-22T17:42:00.000+01:00

The radical transformation of the Central Bank of Nigeria is a possibility soon as plans have reached an advanced stage in the Senate to split the functions of the apex bank by ceding some of it to a new regulatory agency.

It was gathered that the move followed a discovery in its weakness in discharging its supervisory role, which resulted in the current crisis in eight banks whose chief executive officers were sacked between August and October.

A source in the Senate told our correspondent on Wednesday that a proposal was being considered to restrict the apex bank and the National Deposit Insurance Corporation to concentrate on “their core functions.”

In doing so, the CBN, it was learnt, will by law be restricted to monetary policy formulation and keeping inflation in check and maintaining stability of interest and exchange rates.

A body that will be created from the CBN split, the source said, would be placed in charge of operational issues and banking supervision.

The body, which is to be patterned after similar agencies in the United Kingdom and South Africa, will “watch over” commercial, microfinance and mortgage banks.

This is with a view to generating data to enable regulators deal with threats or potential threats to the economic stability of the country.

This will form part of the major amendments being proposed to the CBN Act (2007), which President Olusegun Obasanjo signed in the twilight of his administration.

The Chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions, Senator Nkechi Nwaogu, confirmed the proposal in an exclusive interview with our correspondent in Abuja on Wednesday.

Nwaogu said, “Amending the Central Bank Act (2007) is the major thing we are going to embark on because we in the Senate believe that the CBN Act of 2007 requires a lot of modifications.

“We are of the opinion that the CBN needs to be split into two. We need a different agency to be responsible for the supervision of banking operations, while the CBN should be saddled with the core functions of monetary policy and regulation.”

To make things work better, the NDIC Act is also to be strengthened to ensure that it not only performs its role as insurer of depositors’ funds but also provides and analyse financial reports on the state of banks.

Nwaogu said, “The NDIC Act is an Insurance Deposit Act. It is for Deposit Insurance Companies.

“What primarily should be their core function is that it is not just majorly an undertaker when the banks fail.

“They should be able to provide reports and analyse bank financial status every now and then.

“The new body will be similar to what is being done in the United States and Britain, where they have Financial Services Authority.

“They will be responsible for supervising the commercial banks, the microfinance banks and mortgage banks while the deposit insurance company- the NDIC, should be working with them just like they are working right now.”

Nwaogu added that the Senate was also pursuing the case of depositors whose funds were trapped in failed banks.

She explained that the change of guard at the CBN, as well as other related issues, slowed down action in that direction.

ASEA conference to deliberate on global financial crises

2009-10-21T14:23:00.002+01:00

The effect of global financial crisis on African markets is expected to be brain-stormed when experts in the securities market meet in the13th African Securities Exchanges Association (ASEA) conference to be hosted by the Nigerian Stock Exchange (NSE).

According to a statement signed by the Head of Corporate Affairs, NSE, Mr. Sola Oni, the Exchange will be hosting the 13th African Securities Exchanges Association (ASEA) conference from Wednesday, December 2 to Saturday, December 5, 2009 in Abuja. His Excellency, Dr. Goodluck Jonathan, GCON, Vice President, Federal Republic of Nigeria has graciously accepted to be the Special Guest of Honour.

The Association is currently represented by 20-member Exchanges serving 27 African countries.This year’s conference with the theme “Global Crisis: Opportunities for African Capital Markets”, presents a unique opportunity for African and global stock exchanges, financial regulators, quoted / listed companies, investment banks, pension fund administrators, portfolio managers, clearing and settlement agencies, issuing houses, stockbrokers, multinational organizations, high net-worth investors, and other market operators and service providers to articulate the road map for investment opportunities on African Exchanges in the wake of global market downturn.

This year’s forum, designed to leverage on the effects of the global financial crisis on African capital markets, provides the opportunity for serious discussion about foreign investment, public private partnerships, technology-driven growth, liquidity, regional integration, product diversity and risk management, among others. In all, eight sub-themes have been designed to adequately address the general theme.

According to Oni, “ This conference would also provide a unique platform for all participants to discuss issues and opportunities, and proffer ideas and solutions, with each other and with Nigeria’s regulators, including the Ministry of Finance, Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC), Debt Management Office (DMO), and other members of the Financial Services Coordinating Committee (FSRCC). A pantheon of experts in the securities industry, global fund managers and technocrats have accepted to make presentations at the international conference.

He noted that as a prelude to the conference, the Director General and Chief Executive Officer, NSE, Professor Ndi Okereke-Onyiuke, will on Thursday, October 22, 2009 at 12.00p.m. address a World Press Conference on the concept, hosting strategy, and status of the Conference. The venue of the Press Conference is at the Stock Exchange House in Lagos.

The Nigerian Stock Exchange hosted the conference successfully in 2000 while NairobiStock Exchange, Kenya hosted the last edition in 2007. ASEA was set up on November 13, 1993, with the aim of nurturing systematic mutual cooperation and facilitating the exchange of information among its members.

The association provides a forum for mutual communication, exchange of information, technological assistance and cooperation among its members. The organization aids in the facilitation of financial integration within the region, for the effective mobilization of capital to accelerate economic development across Africa.

Six banks rated among 10 largest companies in Nigeria

2009-10-21T14:13:00.000+01:00

Six out of the 21 banks listed on the Nigerian Stock Exchange have been rated among the 10 largest companies in Nigeria.
A report by International Corporate Research, titled, “Stakes 55” listed the banks as First Bank of Nigeria Plc, Zenith Bank Plc, United Bank for Africa Plc, Guaranty Trust Bank Plc, Ecobank Nigeria and Stanbic IBTC Bank.

Nigerian Breweries Plc, however, topped the chart with a market capitalisation of N415.9bn followed by First Bank, currently worth N358bn.

Zenith was third with N351.6bn in market value.

“The others that made up the ‘Gold Club’ for this quarter are UBA, GTBank, Guinness Nigeria Plc, Dangote Sugar, Ecobank, Nestle Nigeria and Stanbic IBTC,” the report said.

“Stakes 55” is a quarterly release of the largest companies in Nigeria ranked by market capitalisation. It profiles the current situation and most recent happenings in the companies, the position on the ranking, market capitalisation at the date of review and the corporate information.

Dangote completes deal to increase cement production in Africa

2009-10-18T23:39:00.001+01:00

In a bid to meet up with the demand for cement production in Africa, the Dangote Group, one of the leading manufacturing firms in Nigeria, has signed a $228million contract for cement lines in Africa with China's Sinoma.
The contract sum is exclusive of an additional $324m to be spent on infrastructure, power and mining equipment, being handled by other best-in-class vendors
The cement contract is to build a 3,000-tonne per day cement plant in Senegal and Zambia.

Dangote said its strategy is to increase domestic African cement production to meet the demand and ensure that value added benefits remain on the African continent.
The Dangote Group currently owns and operates the Obajana Cement Plant, the largest in sub-Saharan Africa. Other existing projects, and the Sinoma agreement in Nigeria bring the Dangote Group's total commitment to new production capacity in Africa to $1.63bn.
Aliko Dangote, President and CEO of the Dangote Group, said, "We have concluded this deal with Sinoma, to drive forward our Pan-African expansion strategy at a time when the global economy seems to be emerging from recession.
We are in a strong financial position and we are putting our money where our mouth is. This is a huge commitment for a Nigerian company and one of the most significant investment programmes currently being undertaken by any Sub-Saharan African company operating outside of South Africa."
"Africa has everything it needs to become a truly global producer of cement products. We have proved this at Obajana, and will demonstrate it absolutely over the coming years. Sinoma's representatives are already in the market initiating the contracts," he added.

U.S. Stock Market Update

2009-10-18T23:35:00.000+01:00

The S&P 500 halted its 9-day dive just short of 1,098.14, which is the upper end of the gap from 10/3/08 to 10/6/08.

Price momentum oscillators have stubbornly refused to make new highs in October, thereby denying confirmation of new highs by the price indexes. Bearish divergences persist.

Cumulative On-Balance Volume and Candlestick Volume also failed to confirm new price highs last week.

Crude Oil rose further above previous 12-month highs. The main trend remains bullish.

Energy Stock Sector Relative Strength Ratio (XLE/SPY) rose to another a new 4-month high on 10/16/09, and absolute price confirmed. XLE/SPY has been in a strong uptrend short-term this month. Longer term, it appears likely that XLE/SPY bottomed a year ago, on 10/16/08, and has been building a technical base over the past year

Spotlight on event stocks: Here is a stock screen I designed to pick out potential event stocks, both Bullish and Bearish. Sometimes, stocks with large changes in price and volume are revealed to be deal stocks, sooner or later, or are the subject of some other extraordinary events, positive or negative.

Bullish Stocks: Rising Price and Rising Volume
% Price Change, Symbol, Name
4.65% , BHH , Internet B2B H, BHH
2.89% , HAS , HASBRO
2.16% , SIRI , Sirius Satellite
2.30% , ORCL , ORACLE
3.76% , GOOG , Google
2.76% , CAH , CARDINAL HEALTH
2.78% , HGSI , Human Genome Sciences Inc
4.94% , SVU , SUPERVALU
1.71% , URBN , Urban Outfitters Inc.
2.76% , BA , BOEING
1.70% , MZZ , Short 200% MidCap 400 PS, MZZ
1.06% , ERIC.O , LM Ericsson Telephone Company
0.96% , MYY , Short 100% MidCap 400, MYY
0.44% , EWU , United Kingdom Index, EWU
0.86% , MS , MORGAN STANLEY
2.45% , R , RYDER SYSTEM
0.77% , HPQ , HEWLETT PACKARD
0.86% , LNCR , Lincare Holdings Inc
0.85% , HSP , HOSPIRA
0.76% , LMT , LOCKHEED MARTIN
0.28% , PBJ , Food & Beverage, PBJ
1.09% , GIS , GENERAL MILLS
1.61% , SYY , SYSCO
1.42% , SDS , Short 200% S&P 500 PS, SDS
1.21% , SO , SOUTHERN
1.23% , QID , Short 200% QQQ PS, QID
0.61% , MKC , MCCORMICK
1.11% , DXD , Short 200% Dow 30 PS, DXD
0.72% , UIS , UNISYS
0.66% , DOG , Short 100% Dow 30, DOG
0.43% , PPL , PPL
1.00% , MCD , MCDONALDS
0.58% , DIS , WALT DISNEY
1.13% , PM , Philip Morris, PM
0.64% , GD , GENERAL DYNAMICS
1.36% , WAG , WALGREEN
0.66% , PSQ , Short 100% QQQ, PSQ
0.53% , XLP , Consumer Staples SPDR, XLP
0.33% , ACE , ACE
0.61% , SH , Short 100% S&P 500, SH

Bearish Stocks: Falling Price and Rising Volume
% Price Change, Symbol, Name
-12.30% , MTG , MGIC INVESTMENT
-3.74% , RX , IMS HEALTH
-8.09% , MU , MICRON TECH
-1.07% , PZJ , SmallCap PS Zacks, PZJ
-4.43% , GRMN , GARMIN LTD
-1.19% , EWI , Italy Index, EWI
-7.27% , AMD , ADV MICRO DEV
-3.37% , LAMR , Lamar Advertising Company
-4.23% , GE , GENERAL ELECTRIC
-2.60% , RZV , Value SmallCap S&P 600, RZV
-1.15% , IWW , Value LargeCap Russell 3000, IWW
-5.40% , FITB , FIFTH THIRD BANC
-2.96% , HOLX , Hologic, Inc., HOLX
-4.58% , CAR , Avis Budget Group, Inc. (CAR)
-4.95% , IBM , IBM
-6.42% , GNW , GENWORTH FINANCIAL
-0.51% , JKK , Growth SmallCap iS M, JKK
-0.87% , IXJ , Healthcare Global, IXJ
-4.64% , BAC , BANK OF AMERICA
-3.45% , ZION , ZIONS
-0.92% , RFG , Growth MidCap S&P 400, RFG
-5.40% , MI , MARSHAL & ILSLEY
-4.64% , SNDK , SanDisk Corporation
-1.55% , FISV , FISERV
-9.21% , PWER , POWER ONE
-3.97% , SLM , SLM CORP
-4.33% , WFC , WELLS FARGO
-4.65% , STLD , Steel Dynamics, STLD
-2.16% , MDP , MEREDITH
-0.31% , FPX , IPOs, First Tr IPOX-100, FPX
-0.77% , VCR , Consumer D. VIPERs, VCR
-0.87% , JKF , Value LargeCap iS M, JKF
-2.15% , MRVL , MARVELL TECHNOLOGY
-2.79% , MET , METLIFE
-0.98% , MTB , M&T BANK
-3.16% , UNM , UNUMPROVIDENT
-3.61% , ODP , OFFICE DEPOT
-3.15% , TMK , TORCHMARK
-1.57% , EWP , Spain Index, EWP
-0.63% , VIG , Dividend Appreciation Vipers, VIG

9 major U.S. stock sectors ranked in order of long-term relative strength:

Consumer Discretionary (XLY) Neutral, Market Weight. The Relative Strength Ratio (XLY/SPY) appears choppy short term. Intermediate term, the relative trend appears neutral/sideways since peaking on 4/30/09. XLY was strong from 11/19/08 to 4/30/09, and that past strength accounts for XLY’s high ranking here. The XLY/SPY trend was clearly down from 1/5/05 to 11/19/08.

Technology (XLK) Neutral, Market Weight. The Relative Strength Ratio (XLK/SPY) fell further below 4-month lows on 10/16/09. XLK/SPY turned down after 9/30/09. The XLK/SPY Ratio appears to be in a moderate correction for the intermediate term. Long term, on 7/22/09, XLK/SPY rose to its highest level in 7 years, thereby confirming a long-term uptrend in effect since 9/30/02.

Materials (XLB) Neutral, Market Weight. The Relative Strength Ratio (XLB/SPY) peaked on 8/5/09 and has been consolidating gains since. XLB/SPY was in an intermediate-term uptrend from its low on 12/5/08 to its high on 8/5/09.

Financial (XLF) Neutral, Market Weight. The Relative Strength Ratio (XLF/SPY) has fallen sharply after breaking out to a new 10-month high on 10/14/09. Absolute price confirmed by making a new 11-month high on 10/14/09.

Energy (XLE) Neutral, Market Weight. The Relative Strength Ratio (XLE/SPY) rose to another a new 4-month high on 10/16/09, and absolute price confirmed. XLE/SPY has been in a strong uptrend short-term, in this month of October, 2009. Longer term, it appears likely that XLE/SPY bottomed a year ago, on 10/16/08, and has been building a technical base over the past year.

Consumer Staples (XLP) Neutral, Market Weight. The Relative Strength Ratio (XLP/SPY) has been in a moderate downtrend since peaking on 11/20/08, as the appetite for risk recovered.

Industrial (XLI) Neutral, Market Weight. The Relative Strength Ratio (XLI/SPY) has stabilized since making a low on 10/7/09 but is still well below its high of 9/17/09. XLI/SPY was in an intermediate-term uptrend from its low on 3/6/09 to its high on 9/17/09.

Health Care (XLV) Bearish, Underweight. The Relative Strength Ratio (XLV/SPY) fell further below the lows of the previous 12 months on 10/15/09. XLV/SPY has been relatively weak since 2/23/09.

Utilities (XLU) Bearish, Underweight. The Relative Strength Ratio (XLU/SPY) fell below previous 24-month lows on 10/14/09. XLU has underperformed since 11/21/08, as the appetite for risk recovered.

Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) moved further above previous 6-year highs on 10/14/09. Trends remain bullish in all time frames.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) peaked on 9/9/09 and has been lagging slightly since. The ratio outperformed from 10/27/08 to 9/9/09. EFA is the ETF representing the EAFE, the international developed country stock markets, excluding the U.S. and Canada.

NASDAQ Composite/S&P 500 Relative Strength Ratio fell below previous 6-week lows on 10/15/09. The ratio peaked out on 7/23/09 and has been correcting and consolidating since.

Growth Stock/Value Stock Relative Strength Ratio (IWF/IWD) has been correcting and consolidating gains since the peak on 3/5/09. IWF/IWD was in an uptrend from 8/8/06 to 3/5/09, and it is quite possible that uptrend could resume.

Russell 1000 Value ETF Relative Strength Ratio (IWD/SPY) has been correcting and consolidating gains in recent weeks. Intermediate term, IWD/SPY outperformed from 3/6/09 to 9/18/09. Long term, IWD/SPY remains in a Bearish Major Trend, underperforming since 3/22/07.

The S&P 500 equally weighted index relative to the S&P 500 capitalization weighted index has been consolidating gains since 9/16/09. The ratio had been in a strong uptrend from 11/19/08 to 9/16/09, and that trend could resume.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) has been in a downtrend since 11/20/08 as the market shifted toward a more aggressive risk seeking posture.

The Small Cap/Large Cap Relative Strength Ratio (IWM/SPY) been consolidating gains since 9/18/09. IWM/SPY was in an uptrend from 3/9/09 to 9/18/09, and that uptrend could resume. The 10-year trend still looks bullish.

The Mid Cap/Large Cap Relative Strength Ratio (MDY/SPY) has been consolidating gains since 9/16/09. The secular trend since 1999 remains bullish.

Crude Oil nearest futures contract price rose further above previous 12-month highs on 10/16/09. The main trend remains bullish. The first potential support may be seen at the previous high at 75.00 set on 8/25/09. Look for further potential support at previous lows of 65.05, 61.38, and 58.32. Look for potential resistance at previous highs around 74-75.

Gold nearest futures contract price fell back below the lows of the previous 6 trading days on 10/16/09, in what appears to be a normal minor pullback. Gold rose above previous all-time highs on 10/14/09. All trends remain bullish, and Gold appears to have substantial upside potential. Technical supports might be found around previous highs and lows at 1033.9, 1024.7, 982.2, 940.3, 931.5, 925.2 and 904.8, based on the nearest futures contract. There is no chart resistance.

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to Gold bullion) moved above the highs of the previous 3 weeks on 10/13/09. The short-term trend remains bullish. The ratio moved above previous 13-month highs on 9/17/09, confirming a preexisting longer-term uptrend in effect since 10/27/08. This main trend remains bullish for both Gold bullion and Gold Mining Stocks.

Silver/Gold Ratio turned down after 10/9/09. Although the short-term trend has been choppy, the ratio is still above uptrendlines drawn from the low on 10/10/08.

Copper nearest futures contract price has been correcting and consolidating gains since peaking at 29660 on 8/28/09. Copper appears confused about global economic prospects.

U.S. Treasury Bond December futures contract price fell further below the lows of the previous 3 weeks on 10/15/09 in what looks like a minor short-term shakeout. The 4-month trend still looks bullish. The Bond may find short-term support around the previous lows of 118.07 set on 9/23/09, 117.18 set on 9/9/09, and 116.30 set on 8/24/09. On 8/7/09, Bonds found support at the upper end of the 112-115 zone of many previous reversal points (including both lows and highs).

Bond quality ratio (LQD/TLT) partially recovered over the past 2 weeks. It broke down below a 6-month uptrend line and broke down below 11-week lows on 10/1/09, presumably signaling a move away from risk and toward safety. The trend had been up from 12/19/08 to 8/7/09, as the appetite for risk recovered, but that trend appears to have ended. LQD/TLT is iShares iBoxx $ Invest Grade Corp Bond ETF (LQD) price divided by 20+ Years US Treasury Bond ETF price (TLT).

The U.S. dollar nearest futures contract price fell further below the lows of the previous 14 months on 10/15/09. Obviously, the major trend remains bearish, and it probably would take a long period of base building and bottom testing to turn this trend.

The Art of Contrary Thinking: The various surveys of investor sentiment are best considered as background factors. The majority of investors can be right for a long time before a major trend finally changes course. So, Contrary Thinking should be used with more precise market timing tools.

Advisory Service Sentiment: There were 47.2% Bulls versus 26.4% Bears as of 10/14/09, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear ratio was 1.79, down from 2.00 the previous week. The ratio was 2.61 on 8/26/09, the highest reading since 10/17/07. The ratio’s 39-year range is 0.28 to 17.51, the median is 1.43, and the mean is 1.73.

VIX Fear Index touched a new 13-month low of 20.98 on 10/16/09. VIX is down from a peak of 80.86 set on 11/20/08. VIX is a market estimate of expected constant 30-day volatility, calculated by weighting S&P 500 Index CBOE option bid/ask quotes spanning a wide range of strike prices for the two nearest expiration dates.

VXN Fear Index touched a new 13-month low of 21.81 on 10/16/09. VIX is down from a peak of 80.86 set on 11/20/08. VXN is down from a peak of 80.64 set on 11/20/08. VXN measures NASDAQ Volatility using a method comparable to that used for VIX.

ISEE Call/Put Ratio fell to 1.29 on 10/16/09, indicating mildly bearish sentiment. The ratio’s 5-year mean is 1.43, median is 1.38, and its range is 0.51 to 3.16.

CBOE Put/Call Ratio rose to 0.55 on 10/16/09, still indicating bullish sentiment. The ratio’s 5-year mean is 0.67, median is 0.65, and its range is 0.35 to 1.35.

Fundamentals: The 2003-2007 Bull Market was fed by abundant global liquidly, M&A, leveraged buyouts, corporate stock buybacks, and a net balance of positive earnings surprises. The unfolding fallout from the credit market crisis derailed that engine. Since the stock market low on 3/9/09, massive monetary and fiscal stimulation appears to have had a Bullish impact on investor sentiment.

Obama aide: big Wall Street bonuses "offensive"

2009-10-18T23:26:00.000+01:00

WASHINGTON, Oct 18 (Reuters) - A top White House aide lashed out on Sunday at Wall Street firms that are handing out huge bonuses while the rest of the economy struggles and small businesses cannot create jobs because of a lack of credit.

Highlighting a disconnect between Wall Street and Main Street that has caught the attention of the Obama administration, Goldman Sachs Group Inc's (GS.N) was on a pace to hand out more than $20 billion in bonuses, which could make this year a record.

Compensation is also soaring at several other big firms, which are raking in higher trading revenues amid a recovery in the stock market that lifted the Dow Jones industrial average above 10,000 last week.

But the economy remains weak elsewhere and the U.S. unemployment rate, now at 9.8 percent, is widely forecast to climb above 10 percent.

"The bonuses are offensive," David Axelrod, a senior adviser to President Barack Obama, said on the ABC News program, "This Week."

"The most offensive thing is, we haven't seen the kind of increase in lending that ... we should," Axelrod said. "There are a lot of small businesses, credit-worthy businesses around this country who still can't get the capital they need to grow, which is important for our economy.

Axelrod and other U.S. officials emphasized on television talk shows that they were considering a variety of options to boost the economy and rekindle job growth.

But they also said they wanted to be mindful of the budget deficit.

WHITE HOUSE PRODS WALL STREET ON REFORM

White House aides pushed Obama's proposals for a broad rewriting of financial regulations aimed at preventing a repeat of Wall Street's worst crisis since the Great Depression.

The Obama administration has become increasingly vocal about what it sees as efforts by the financial industry to water down or block the reforms.

Axelrod and White House chief of staff Rahm Emanuel said Wall Street, which was saved from the brink of collapse by a $700 billion bailout from the U.S. government, had a duty to get behind the financial reforms.

Emanuel told CNN's "State of the Union" that many firms were now enjoying normalcy but "they're now back trying to fight consumer offices and the type of protections that will prevent another type of situation where the economy is taken over the cliff by the actions taken on Wall Street and the financial market."

Emanuel also said it was "frustrating to the American people" that financial firms are doling out big bonuses while incomes of other people are stagnating or falling.

A bill approved by the House of Representatives would impose new limits on executive pay, but the Senate has not yet acted on the issue.

For firms that still owe the government money under the bailout program, Treasury's pay czar, Kenneth Feinberg, has leeway to crack down on compensation packages.

But Axelrod said the administration is seeking to use "moral suasion" with some firms. Those such as Goldman Sachs that have already paid the government back are not subject to the Treasury's oversight of compensation.

Obama has faced criticism over the financial bailout program and his $787 billion stimulus plan enacted earlier this year. The financial bailout program was begun by the Bush administration in September 2008 and continued under Obama.

Republicans have labeled the stimulus package wasteful and say the high jobless rate is evidence it has not worked.

Obama administration officials say the stimulus plan helped save the economy from disaster.

They say they are still considering whether to propose additional steps to give the economy a jolt, but they have been reluctant to use the label "stimulus" to describe the possible further measures.

Asked on NBC's "Face the Nation" if a second stimulus was under discussion, White House adviser Valerie Jarrett said that Obama was "willing to look at all possibilities." But she said the original stimulus bill needed to be given time to work.

Axelrod said the administration was determined to prevent the economy from "cascading backward into a recession." But he also said Obama was paying close attention to the U.S. budget deficit, which hit a record $1.4 trillion in the just-ended 2009 fiscal year.

He said that Obama would address the issue of the deficit "at some length" in his "State of the Union" address to Congress in January.

NSE says AMC will boost capital market operations

2009-10-15T12:34:00.001+01:00

The Nigerian Stock Exchange has said that the proposed Asset Management Company will boost activities in the capital market.

The Director-General, NSE, Prof. Ndi Okereke-Onyiuke, said this while addressing market operators on the trading floor on Wednesday. She noted that the AMC would also address the various, challenges rocking the Nigerian financial system, and the economy as a whole.

The DG, however, called on the market operators to deliberate on issues regarding the AMC during their forthcoming annual conference which will hold later this month.

Spokesperson for the NSE, Mr. Sola Oni, in a text message to journalists, quoted the DG as saying that the asset management company was not a design by the government to bail out just the capital market, but the entire financial system of the country.

He said, ”The Director-General advised stockbrokers to include asset management company among the issues to be discussed at their conference in Ibadan. It will help appreciate the fact that the Federal Government’s aim for setting up the Asset Management Company is not to bail out the market, but the whole gamut of the economy.”

Meanwhile, activities at the NSE closed on a negative note on Wednesday, with major indicators recording significant declines.

Specifically, the market capitalisation of the listed equities, fell by one per cent or N52bn to close at N5.353tn down from N5.405tn recorded on Tuesday.

Similarly, the NSE‘s All-Share Index closed at 22,985.05, representing a fall by one per cent or 221.30 basis points from 23,206.35 on Tuesday.

Two petroleum marketing stocks- Oando Plc and African Petroleum Plc- had the highest price losses of the day, shedding 2.2 per cent and 3.2 per cent to close at N90 and N32.01 per share respectively.

Lafarge Wapco Plc followed, also shedding 3.2 per cent to close at N30.06 per share.

On the other hand, Nestle Nigeria Plc had the highest gain, rising by five per cent or N10.40 to close at N218.40 per share.

Conoil Plc also gained five per cent or N1.79 to close at N37.60 per share, while, Nigerian Bottling Company Plc and Nigerian Breweries Plc appreciated by five per cent and 1.7 per cent to close at N22.27 and N55 per share in that order.

Again, CBN Releases Names of ‘Non-Performing’ Debtors

2009-10-15T11:12:00.000+01:00

The Central Bank of Nigeria (CBN) yesterday made good its threat to publish names of non-performing debts – owed mostly by politicians, entrepreneurs and shareholders/directors – whose companies secured loans totalling N450 billion from five banks.

The banks - BankPHB Plc, Equitorial Trust Bank, Spring Bank Plc, Wema Bank Plc and Unity Bank Plc - were those found wanting in the last round of audit exercise embarked on by the banking watchdog.

This culminated in the sack and replacement of the managing directors and executive directors of the first three banks said to be in “grave situation” two weeks ago. The two others were asked to recapitalise by June 2010.

Sources told THISDAY last night that the chief executives of the five banks said to be having challenges in their debt recovery drive pressurised the apex bank into publishing the latest list in a bid to compel their debtors to pay up.

The banking watchdog had on the 19th of August published the names of debtors (who owed N747 billion) of the initial five banks (Afribank, Oceanic Bank, FinBank, Intercontinental Bank and Union Bank) which had their CEOs sacked on August 14.

Over N100 billion has since been recovered from the debtors of these banks.

A breakdown of the loans, which are classified as non-performing in the latest list, is as follows: Bank PHB, N170 billion; Spring Bank, N95 billion; ETB, N46 billion; Unity Bank, N37 billion; and Wema Bank, N101 billion.

Some of the biggest debtors to BankPHB are one of its subsidiaries – Platinum Capital, which secured N11 billion; Akara Overseas Development owned by Prince Oyedele – N10 billion; N6.3 billion by Hometrust Savings and Loans owned by Yomi Disu, Funmi Ademosun and Tony Ubogu, while N16.7 billion is owed by Falcon Securities owned by Peter Okolo, currently on trial over his company’s N88 billion exposure to three other banks (Afribank, FinBank and Union Bank). Okolo’s other company - Peterson Oil and Gas also owes N4.5 billion. Also included is Femi Otedola’s Zenon Oil, which owes N5.2 billion.

In ETB, Conoil owes N19.8 billion; BayelsaState – N5.97 billion; Globle Motors, which has Williams Anumudu as one of its directors - owes N3.032 billion; N3.321 billion for Premium Seafoods, which has Sunil Vaswani and Haresh as directors, while Dangote Limited owes N1.96 billion.

Prominent among the debtors of Spring Bank are three companies, National Sports Lottery – N4.12 billion; NSL Lotteries Management Ltd – N3.32 billion and Victoria Construction International Ltd – N1.58 billion.

Also indebted to Spring Bank to the tune of N7.874 billion are two companies, Netlink Digital TV and Mofas Shipping Line, owned by Otunba Oyewole Fasawe, while Metro Energy & Gas Ltd in which prominent politician – Tony Anenih – is a director owes N2.06 billion.

Major debtors to Unity Bank are Alpha Property Development Company, which owes N1.8 billion. Alhaji Kashim Ibrahim is a director. Kola Abiola is also said to be owing Unity Bank N1.4 billion, while Albarka Air Services, which has Mohammed Buba Marwa, has one of its directors, is indebted to the tune of N1.1 billion.

Plateau and Bauchi States also owe Unity Bank N865 million and N676 million respectively.

Some of the principal debtors to Wema Bank are one of its subsidiaries – Independent Securities Ltd, which secured N25 billion; Transcorp - N16.6 billion; Wema Asset Management (also a subsidiary of Wema) – N10 billion; Suffolk Engineering & Construction owned by Admac Industry Ltd and Henry Macpepple owe N4.6 billion. Odua Investment – N1.7 billion; Jimoh Ibrahim’s Global Fleet – N3 billion, while another subsidiary, Wema Securities, is indebted to the tune of N2.2 billion.

US Recession over

2009-10-14T14:02:00.001+01:00

The worst U.S. recession since the Great Depression has ended, but weak household spending as the labor market struggles to create jobs will slow the pace of the economy's recovery, according to a survey released on Monday.

The survey of 44 professional forecasters released by the National Association for Business Economics, also known as the NABE, found that 80 percent of the respondents believed the economy was growing again after four straight quarters of declines.

"The great recession is over," NABE President-Elect Lynn Reaser said.

"The vast majority of business economists believe that the recession has ended, but that the economic recovery is likely to be more moderate than those typically experienced following steep declines."

Recessions in the United States are dated by the National Bureau of Economic Research. The private-sector group, which does not define a recession as two consecutive quarters of decline in real gross domestic product, often takes months to make determinations.

The recession that started in December 2007 is the longest and deepest since the 1930s. It was triggered by the U.S. housing market's collapse and the ensuing global credit crisis.

While the economy is believed to have rebounded in the third quarter, analysts believe that ordinary Americans will probably not see much difference as unemployment will remain high well into 2010, restraining consumption.

"We don't necessarily expect the U.S. economy to fall into a double-dip recession. This time round, consumers will be reluctant to join the party," said Paul Ashworth, senior U.S. economist at Capital Economics in Toronto.

The NABE survey, conducted in September, predicted real GDP growth expanding at an annual pace of 2.9 percent over the second half of this year. Output for all of 2009 is expected to contract 2.5 percent and next year, rebound 2.6 percent.

Much of the anticipated recovery was seen driven by businesses rebuilding their inventories after aggressively reducing unwanted stockpiles of unsold goods to match weak demand.

HOUSING PRICES TO HIT BOTTOM

Investment in the residential market would also add to growth, with the majority of the survey's respondents convinced that the housing market downturn, which has lasted more than three years, was close to coming to an end.

About two-thirds of respondents believed house prices will reach a bottom this year. The survey found that high house prices would not pose a threat to the sector's recovery.

The survey predicted that the unemployment rate will rise to 10 percent in the first quarter of 2010 and edge down to 9.5 percent by the end of that year. The labor market was not expected to regain most of the jobs destroyed in the recession until 2012 or beyond.

The weak labor market will continue to weigh on consumer spending, slowing the recovery. The jobless rate climbed to 9.8 percent in September -- a 26-year high -- from August's 9.7 percent.

Labor market slack, combined with weak wage growth, meant inflation would not be an obstacle to the economic recovery and the Federal Reserve will not be under pressure to raise interest rates, the survey found.

"With improving credit markets, the U.S. economy can return to solid growth next year without worry about rising inflation," Reaser said.

The U.S. central bank was seen leaving its overnight benchmark lending rate near zero until late next spring, followed by measured increases that would take the rate to 1 percent by the end of 2010, the survey showed.

Despite signs of improvement in the financial markets, most respondents believed that it would take some time for them to return to normal. Only 29 percent believed this would happen in the second half of next year.

Respondents also expected the U.S. dollar to weaken further this year and into 2010, but did not see this contributing to a narrowing of the country's trade deficit as the economic revival stimulates demand for imports.

The dollar has lost about 5.8 percent of its value against a basket of currencies so far this year, largely because of worries over the government's growing budget deficit and expectations that the Fed will keep interest rates at super-low levels for a while.

EFCC recovers N21.6bn from Transcorp

2009-10-14T13:47:00.003+01:00

he Economic and Financial Crimes Commission said on Tuesday that it had recovered a total of N135.6bn from debtors of five banks, whose managing directors were sacked by the Central Bank of Nigeria in August.

It also said that it recovered N21.6bn from Transcorp out of about N30bn it owed some banks.

The Head of Media and Publicity, EFCC, Mr. Femi Babafemi, disclosed this to our correspondent on the telephone in Abuja.

Non-performing loans totaling N747bn of five banks had led to the sacking of the chief executive officers of Union Bank, Intercontinental Bank, Oceanic Bank, Finbank and Afribank.

Similarly, a former Chairman of Alliance for Democracy, Ambassador Yusuf Mamman and Mr. Jafaru Sani were detained by the EFCC.

It was gathered that Mamman‘s detention was not unconnected with the mismanagement of N130m belong to Aso Radio.

An EFCC operative said that a dummy account was opened in respect of the N130m.

The source said that the commission had evidence to show that the money was mismanaged, just as he said that Mamaman and Sani would remain in detention as more suspects faced interrogation on Wednesday.

Technical Suspension Lifted, Bank PHB and Spring Bank

2009-10-14T13:44:00.000+01:00

The Technical Suspension which was placed on Bank PHB Plc and Spring Bank Plc has been lifted today October 13, 2009.

It’s a joint decision by the Securities Exchange Commission and the Nigerian Stock Exchange as the basis for the suspension has been addressed. It is lifted this morning, exactly after one week: Mr. Sola Oni, Assistant General/ Head Corporate Affairs.

The technical suspension was placed on October 5, 2009 following the sack of their managements by the Central Bank of Nigeria (CBN) after the final audit of the banks revealed that their operations were in grave danger.

The suspension was to guard against negative responses from some of the investors in Bank PHB and Spring Bank due to the CBN’s action.

EFCC uncovers N23bn scam in Oceanic Bank - Slams money laundering charge on Ibru, 2 others - Begins

2009-10-14T13:27:00.000+01:00

Operatives of the Economic and Financial Crimes Commission (EFCC) investigating the alleged massive insider abuse in the banking sector have reportedly uncovered an alleged N23 billion money laundering scam in Oceanic Bank.

Oceanic Bank is one of the eight banks that had their management teams sacked by the Central Bank of Nigeria (CBN) in the wake of alleged unethical practices in the industry.

The aftermath of the discovery, according to sources in the commission, has seen fresh money laundering charges being prepared against the sacked Group Managing Director and Chief Executive Officer of the bank, Mrs Cecilia Ibru and two others.

They are Dele Oye, a legal practitioner, and Nana Shetu Bedeni, a nanny to the Ibru family.

In order to make them face the law, the commission is also said to have commenced their repatriation from abroad where they reportedly fled following the arrest of Mrs. Ibru over the alleged unethical practice in the running of the bank.

She is being prosecuted alongside 13 former bank chiefs sacked by the apex bank in five banks during the first round of the sanitisation exercise in the industry.

It was further gathered that the commission had also added former Group Managing Director of Intercontinental Bank Plc, Erastus Akingbola to the extradition list.

Akingbola left the country for the United Kingdom following his removal by the apex bank and has since been declared wanted by the anti-graft commission.

Commission’s spokesperson, Mr. Femi Babafemi, confirmed that the commission was working hard on cases involving all the individuals mentioned.

According to him “I don’t have the details you referred to, but I know that the commission is working hard on the cases of some individuals you referred to”.

Nigerian Tribune gathered that fresh facts dug up by the commission’s operatives revealed that Mrs. Ibru was allegedly using Dele Oye and Nana Bedeni as fronts to launder investors’ and depositors’ funds to her personal purse.

Sources disclosed that Waves Nigeria Ltd, a company allegedly owned by Ibru’s son, who was a director in the bank, was allegedly used in laundering the N23 billion sum, even though its shares capital during registration with the Corporate Affairs Commission {CAC}was just one million shares, and by law, should not receive money beyond its share capital capacity.

The ownership of the company was said to have been relinquished by Ibru’s son to Bedei and Oye in 2006, with Mrs. Ibru allegedly paying 110 million dollars (about N16.9b) and N6 billion to the company almost immediately the duo took over the ownership of the company.

The company under the leadership of the duo was said to have paid 10 million dollars (N1.5bn) to Mrs. Ibru’s private bank account, after the N23 billion payment was made.

Sources added that the commission’s operatives also discovered that the company was awarded a contract by Oceanic leadership under Mrs. Ibru to build its corporate headquarters, with documents allegedly found with the bank showing that the payments made to the company was for the project.

It was further learnt that documents from Waves allegedly showed that it owned the building while Oceanic would just be a tenant, though the land on which the property is being built was allegedly discovered to belong to the Ibru family.

Though the said property is still said to be under construction, documents found exhumed by the commission’s operatives showed that Oceanic had already paid 22 million dollars (N3.4bn) for 10 years rent to Waves Ltd for the uncompleted building.

Findings of the commission’s operatives reportedly showed that the Ibru leadership at Oceanic paid rent for a property that was paid for and still under construction, with one of the sources saying that “The whole deal was designed to just siphon shareholders and depositors monies into private accounts and that is why they would face a fresh money laundering trial”.

Ibru is currently on conditional bail, with sources in the anti-graft commission revealing that she would be arraigned in Lagos next week over the alleged money laundering.

The commission, it was learnt, would also apply to the court for the repatriation of her co-accused during her fresh arraignment.

Weekly Round Up - Equities Market Rebound by 3.44%

2009-10-10T04:53:00.001+01:00

The NSE All Index rose by 3.44% to close on Friday at 23,271.69. The Market Capitalization closed higher at N5.42 trillion.

A turnover of 3.2 billion shares worth N22.11 billion in 33,985 deals was recorded this weak as compared to a total of 2.2 billion shares valued at N16.14 billion exchanged last week in 27,236 deals.

The Banking subsector was the most active during the week with 2.02 billion shares worth N16.35 billion exchanged by investors in 19,701 deals. Volume in the sector was largely driven in the shares of Access Bank, First City Monument Bank and Zenith Bank.

The Insurance subsector was boosted by the activities in the shares of International Energy Insurance and CornerStone Insurance. Insurance sector has a turnover of 383.95 million shares valued at N386.9 million in 2,432 deals.

Losers and Laggards

The market breadth was positive at 1.44 as compared to 1.08 last week. Oando led on the gainers table with a gain of N4.70 to close at N92.20 while Nigerian bottling Company followed with N2.83 to close at N20.88.

Wapco Nigeria led on the price losers table dropping by N3.95 to close at N30.05 per share while Conoil followed with a loss of N3.51 to close at N32.49.

New Listing

The 3.71 billion of shares of N 0.50 each in favor of Beco Petroleum Products were admitted at a price of N2.50 per share on October 7, 2009. The Company is listed in Petroleum Sub sector.

Technical Suspension

Bank PHB Plc and Spring Bank were placed on technical suspension on Monday October 5, 2009. The Suspension would be reviewed after one week.

Review of The NSE-30 Index

The Index Committee held its quarterly meeting to review and rebalance The NSE 30 Index. At the end of deliberations, Wema Bank Plc and FinBank Plc were dropped from the index while Pinnacle Point Group Plc and Ecobank Nigeria Plc were included.

Corporate Results

ASO SAVINGS & LOANS PLC: Audited result for the year ended 31st March 2009 shows Gross Earnings of N10,090.14 million as against N7,063.13 million in 2008. Profit after tax stood at N873.5 million compared with N1,061.8 million in 2008. The Board of Directors is recommending a dividend of N0.05 per share. The date of closure of register was October 12, 2009 while payment date is November 10, 2009. The 11th Annual General Meeting is scheduled to hold on Tuesday, November 3, 2009 by 11.00a.m.

NEIMETH INTERNATIONAL PHARMACEUTICALS PLC: Audited result for the year ended 31st March 2009. The date of closure of register is October 21, 2009. The 51st Annual General Meeting is scheduled to hold at Lagos Airport Hotel Limited, Ikeja on Wednesday, October 21, 2009 by 11.00a.m.

NATIONAL SALT COMPANY OF NIGERIA PLC: Unaudited result for the half year ended 30th June 2009 shows Turnover of N4,276.14 million, as against N3,602.8 million in the comparable period of 2008. Profit after tax stood at N763.21 million compared with N642.74 million in 2008.

Company Forecast

ASO SAVINGS & LOANS PLC: The Company forecasts Interest Income of N11, 992.5 million and profit after tax of N2, 025.5 million during the year ending March 31, 2010.

UACN PROPERTY DEVELOPMENT COMPANY PLC: The Company forecasts Turnover of N13, 730.9 million and profit after tax of N2, 110.5 million during the fourth quarter ending December 31, 2009.

STANDARD ALLIANCE INSURANCE PLC: The Company forecasts Gross Premium of N1,531.8 million and profit after tax of N1,265.25 million during the year ending December 31, 2009.

VONO PRODUCTS PLC: The Company forecasts Turnover of N669.2 million and loss after tax of N119.53 million during the fourth quarter ending December 31, 2009.

Stock Exchange lists new petroleum company (Beco Petroleum Products Plc )

2009-10-10T04:48:00.000+01:00

The Nigerian Stock Exchange (NSE), on Wednesday, listed by introduction, Beco Petroleum Products Plc’s 3.72 billion Ordinary Shares of 50 kobo each at N2.50 per share; thereby increasing the number of quoted First-Tier equities to 197.

Listing by introduction means that investors can only buy the company’s stock through their stockbrokers at the stock market.

Lance Elakama, the NSE’s Assistant Director General, who declared the listing, said the coming of the new company to the petroleum marketing subsector of the Exchange is expected to boost investors’ confidence in the market because “the subsector has been showing signs of improvement”.

Ogala Osoka, Beco Petroleum’s Chairman, said that he believes the stock will perform well in the market because “since the company transformed into a public liability company in 2008, after a private placement outing, its assets of N425.9 million has increased to N4.043 billion.”

Mr. Osoka said the company, which was founded in 1986 with one million shares of N1 each, currently has a share capital of 6.52 billion units of 50 kobo each and hopes to raise from the capital market, its targeted 3.72 billion units of 50 kobo each at N2.50 per share.

The chairman noted that the global economic condition has affected the company’s expansion programme, adding, “Achieving long term sustainable growth of the company remains the objective.”

Olu Odejimi, the spokesperson for stockbrokers, who is also the Chief Executive Officer of Clearview Investment Ltd, has given assurance to the management o f the company of their support in attracting investors to the stock.

Mr. Odejimi said that Beco Petroleum’s historical figures and projected turnover for the next three years ares promising.

Henry Mojekwu, Managing Director of Beco Petroleum, said, “The company came to the market to achieve its vision to be one of the foremost integrated players in the marine, oil and gas sectors of the Nigerian economy.”

He explained that the additional fund will help the company increase its current 15 service stations to about 200 stations. Mr. Mojekwu said that the company is developing a petroleum products tank farm with 96,000 metric tonnes, and currently owns and operates two marine tankers with a combined tonnage of 13,000DWT. “Beco Petroleum also plans to construct a gas plant in the future project,” he added.

Market close lower

Meanwhile, at the close of stock trading on Wednesday, about N15 billion was lost. The NSE’s market capitalisation and All-Share index dropped, each, by 0.28 per cent.

The market capitalisation closed at N5.349 trillion down from the N5.364 trillion it closed at on Tuesday, while the All-Share Index closed at 22,968.21 units from 23,071.66 units it recorded the previous day.

A total of 790.680 million quantities of stocks were traded, worth N5.408 billion in a record of 8,483 deals. Also, a total of 43 stocks appreciated in price while 36 stocks depreciated at the close of the day’s trading.

The banking sub-sector maintained its lead on the most active sub-sectors’ chart while the insurance and information communication/telecommunication sub-sectors followed.

source: proshare

Nigerian stock market update, for 26th January 2009.

2009-01-27T18:44:00.000+01:00

Data from the Nigerian Stock exchange shows: the 4th trading week of the year and the last for the month of January, starting on a continued bearish note. The All Share Index (ALSI) closed at 23,306.87 basis points, as against last week Friday’s 24,000.09 basis points; indicating 2.88 percent down slide. A total of 6,407 deals were closed today involving a share volume of 216,034,644 units, worth N1.245 billion; as against last week Friday’s 6,072 deals involving a share volume of 216,057,242 units, worth N1.171 billion. The market capitalisation also closed at N5.191 trillion as against preceding trading day’s N5.345 trillion.
The top price gainers for today, listed in a descending order include: (1) COSTAIN which gained N0.39 to close at N8.21; (2) TANALIZER gained N0.06 to close at N1.37; (3) OMATEK gained N0.06 as well, to close at N1.32; (4) STDINSURE gained N0.05, to close at N1.11.
On the other hand, the top price losers includes: (1) NESTLE lost N7.79, to close at N148.16; (2) CHEVRON lost N6.22 to close at N118.33; (3) OANDO lost N3.32, to close at N63.14; while (4) JBERGER lost N2.50, to close at N47.68.

Risk and stock investment

2009-01-27T18:43:00.000+01:00

All investments as we very well know involves some kind of risk. It has also been said that the higher the risk the higher the returns. Risk is therefore a factor that cannot be pushed aside once embarking on any business investment of any sort. I once told a group of people that business can also be referred to as risk and the level to which you make progress depends on the level to which you reduce the risks.Similarly, stock investment is also risk and the level top which to grow your portfolio or make gains depends on the level to which you mitigate risks.

How you as an investor defines risk would be quite different from the definition of the man standing next to you. Your definition therefore is meant to give you an insight as to the kind of investor you are. This also implies that what might work for you might definitely not work for your neighbor or brother as the case may be and vice versa.

For some, risk is defined as owning only a few investments and as such they diversify. They buy a few of a lot instead of owning a lot of a few. I have been there before. For others, risk is determined by how much the value of an investment will swing. Consequently, they go for low volatility investment like bonds or treasury bills which give an appearance of low risk. The list goes on and on. Risk however as defined by world renowned Warren Buffet is “not knowing what you are doing”.

For most people that diversify, they do so out of ignorance. If you as an investor takes time to study and understand a business and consequently obtain their shares at attractive prices, then you would want to buy more of what you understand. One key factor that investors must have is a margin of safety with all investments. Reckless speculating with low probability of return is no different from going to casino and gambling.

Buying stocks because you feel you have the money is also risky. Holding your money without buying can be the best form of investment activity sometimes. Think about it.

Nampak releases 2008 Audited results: explains declining fortunes

2009-01-27T18:13:00.000+01:00

Nampak Nigeria Plc, a company quoted in the packaging sub –sector of the Nigerian Stock Exchange released its year ended, September 2008 audited results recently. The company was able to manage a marginal increase of 4 per cent in its turnover to N2.976 billion, over that of year 2007, which stood at N2.849 billion. It loss over the past one year however increased significantly from N136.4 million in 2007 to N238.6 million, representing about 75 per cent further decline in its fortunes in 2008.

In the release, the company’s board noted that “the material negative variances arising from system and control issues from the past that continue to impact on the business during the financial year have given rise to the reported loss”. The board however noted that the management had implemented a number of controls that began to have positive effects on the business in the last quarter of the year. They maintained that given a stable political and economic condition in the country, the business would return to profitability during the course of 2009.

The company would, according to its publication in the dailies, hold its 49th Annual General meeting on the 18th of February 2009 at the Banquet Hall, Excellence hotel, Ogba by 11 am. The closure of the register and transfer of books has been scheduled to be 11th to 12th February 2009 – both dates inclusive.

Nigerian stock market update for 22 January 2009.

2009-01-24T14:01:00.000+01:00

Data from the Nigerian Stock exchange indicates, a 2.49 percent downward sloping in its All Share Index (ALSI), closing at 24,762.50 basis points, as against yesterday’s 25,397.26 basis points. A total of 7,223 deals were closed today involving a share volume of 210,169,065 units, worth N1.356 billion; as against yesterday’s 7,270 deals involving a share volume of 280,639,775 units, worth N1.730 billion. The market capitalisation closed at N5.515 trillion, as against preceding day’s N5.656 trillion.

The top price gainers of the day in a descending order includes: (1) UNHOMES which gained N0.11 to close at N2.57; (2) DANGFLOUR gained N0.10 to close at N9.49; (3) VITAFOAM gained N0.08 to close at N4.40; while, (4) ASHAKA gained N0.06 to close at N11.40.
On the other hand, top price losers of the day includes: (1) CHEVRON which lost N6.55 to close at N124.55; (2) LONGMAN lost N1.25 to close at N23.82; (3) NB lost N1.20 to close at N33.00; while, (4) FLOURMILL lost N1.07 to close at N20.51.

Power and Naira fluctuation menace, and the manufacturing sector of the Nigerian economy (1).

2009-01-24T13:59:00.000+01:00

The financial reports especially the ‘Trading, Profit and Loss’ account of a typical manufacturing company or group is normally characterized by a huge fraction of the operating cost attributable to raw materials and power. Going by this fact, any significant fluctuation in the cost of these could make or mar any company that predominantly engages its resources in manufacturing activities. Most manufacturing industries in Nigeria, have the bulk of their raw materials imported from foreign countries. This shows that at the moment, the erratic depreciation of the Nigerian naira against the United State’s dollar, the dollar being the major currency for international transactions; and at such, threatening to the Nigerian secondary manufacturing sector.

Somehow, the only companies that could be said to be relatively free from this heavy dependence on imported raw materials ‘threat’ are those in the cement industry, which includes the likes of West Africa Portland Cement Company Plc (WAPCO) and Benue Cement company Plc (BCC), having locally sourced ‘lime stone’ as their chief raw material. Also the agricultural and some agro-allied industry companies, in the likes of Okitipupa and Okomu oil, having oil palm seedling as their major raw material; while fertilizer is most times subsidized as an incentive from the government for investing in the agricultural sector. One could as well, add companies that fall into the primary production sector of the economy, that is to say industries that extract their products directly from land (nature), including: petroleum industry, mining and agriculture. These may not be heavily exposed to the fluctuating foreign exchange rate menace, with respect to imported raw material, cost items

Power and Naira fluctuation menace and the manufacturing sector of the Nigerian economy (2).

2009-01-24T13:58:00.001+01:00

With the current fluctuation of the Naira in the FOREX market especially since the beginning of the year, Nigerian companies especially those in the manufacturing sector will be facing some short term exposure, exchange rate risks.

Recently, the Central Bank of Nigeria, led by professor, Chukwuma Soludo, changed its regulated FOREX trading system, from the previous ‘Wholesale Dutch Exchange System’ to the re-introduced retail system, known as the ‘Retail Dutch Exchange system’ (RDES); whereby banks and other licensed foreign exchange dealers, are not allowed to bid for foreign currency on their own account, rather on behalf of clients who would have presented a documented evidence of items to be imported or other transactions in desired foreign currency . This recent development that went into operation on Monday, 19th of January 2009, saw dollar supply exceed its demand for the first time in a while, as only a few banks participated at all in the day one of this newly introduced trading system. This short term measure is aimed at curbing unhealthy speculative demands for the dollar and other foreign currencies at the detriment of the naira, as these foreign currencies naturally go up in price as demand for them exceeds supply. According to CBN’s letter, “GUIDELINES FOR THE OPERATION OF THE FOREIGN EXCHANGE MARKET: RETAIL DUTCH AUCTION SYSTEM (RDAS)” on January 15 2009, addressed to dealers and the public, it is an intervention measure in consideration of recent developments in the Foreign Exchange Market. The previously used ‘Wholesale Dutch Auction System’ (WDAS), is a system whereby authorized dealers bought foreign currency from CBN on wholesale based on anticipated foreign exchange needs of their customers, at such was a speculative market system.

Power and Naira fluctuation menace and the manufacturing sector of the Nigerian economy (3)

2009-01-24T13:55:00.000+01:00

Whatever policy designed for rejuvenating the manufacturing sector, may never see the light of the day, unless the issue of power supply is properly addressed. Again, manufacturing companies may continue to see their efforts get eroded due to high cost of powering manufacturing plants. Nigerians have witnessed many of its past governments; make so many promises on creating a stable and sufficient power supply. Tax payers money had been sunk in various mega power generation projects, yet same tax payers have continued to spend excessively on alternative power supply that will only continually burn away their hard earned money by way of diesel or gasoline, and pollute the atmosphere.

However, what seems to be hope for the manufacturing sector is the stepping in of state governments into this urgent matter. The Lagos state government earlier went into an agreement, whereby, the state generates and contributes power to the national grid; other states are in the news for having plans for similar arrangement in near future. In turn, the Power Holding Company of Nigeria Plc will have to reciprocate by commensurately increasing the quantity of power supplied to the individual states through PHCN’s distribution system. It is indeed an urgent and welcomed measure considering the disadvantaged position of the Nigerian manufacturing sector, with regards to their huge expenditure in generating their own power. This same cost would at the end of the day be transferred to the individual companies share holders, making the manufacturing industry, quoted companies less attractive. The ugly power situation, has in recent times seen many Nigerian mega manufacturing companies produce and own brand products from their various plants located outside the country and import same from neighboring west African countries where they are sure of cutting cost on power; well that is due to the ‘absolute advantage’ of these other countries due to power, over Nigeria.

Nigerian stock market update for 20 January,2009.

2009-01-21T04:57:00.000+01:00

The Nigerian Stock Exchange continued on its current bearish trend, as data from the NSE trade engine indicated a 1.57 percent drop in its ‘All Share Index’ (ALSI) down to 26,247.84 basis points, from yesterday’s 26,667.09 basis points. There were a total of 8,495 stock transactions, involving a share volume of 467,391,389 units, worth N1.868 billion; as against yesterday’s 7,987 stock transactions, involving a share volume of 247,720,959 units, worth N1.714 billion.
The market capitalisation closed downwards at approximately N5.840 trillion, as against yesterday’s closing valuation of N5.993 trillion.
The market would be watching to see how the new president of the United States of America, Barack Obama and his much talked about positive change would affect the rather ailing world’s largest economy (USA), and the after effect on the global economy, which is expected to in turn bring some relief to the currently dwindling fortunes of the Nigerian Stock Exchange, and other emerging capital markets.

Deap Capital, this morning presented to the market, its full year result for the accounting period ended 30th November, 2008; which showed an 11.44 percent appreciation in its ‘Profit After Tax’.
While, PZ’s yesterday release of a positive earnings result with an 8.61 percent ‘Profit After Tax’ growth, saw its price appreciate by 70 Kobo.

The top price gainers in a descending order includes: (1) OANDO gained N1.99 to close at N73.99; (2) GUINNESS gained N1.75 to close at N76.00; (3) PZ gained N0.70 to close at N14.70; (4) while UACN gained N0.68 to close at N27.98.
The top price losers in a descending order includes: (1) LONGMAN which lost N1.31 to close at N25.07; (2) FLOURMILL lost N1.19 to close at N22.71; (3) WAPCO lost N1.01 to close at N19.37; while (4) BCC lost N0.99 to close at N18.95.

Recent results, plus Longman’s 2 for 1 bonus proposal
Posted: 20 Jan 2009 08:26 AM PST
Deap Capital, this morning released its full year result for the accounting period ended 30th November, 2008. The ‘Turnover’ rose to N1.334 billion, as against a year 2007’s comparable periods posting of N739.450 million. A ‘Profit Before Tax’ figure of N396.07 million was recorded, as against preceding comparable period’s N331.130 million. While, the ‘Profit After tax’ rose to N343.847 million, as against a preceding comparable period’s loss position of N308.545, showing an 11.44 percent growth.
Meanwhile, the company directors have proposed a dividend of 15 Kobo payable on the 9th day of February, 2009. The closure of register is on the 19th of March, 2009.

Yesterday, PZ Plc listed under the conglomerate sector of the Nigerian Stock Exchange, made a presentation of its earnings result for the half year period ended 30th November 2008, to the market. It made a ‘Turnover’ of N35.860 billion, as against preceding comparable periods N29.953 billion. The ‘Profit Before Taxation’ rose to N2.340 billion, as against preceding N2.013 billion. While, ‘the Profit After Taxation’ also climbed to N1.476 billion as against, preceding comparable periods N1.359 billion, indicating an 8.6 percent growth in company’s net profit.

Also, Longman Nigeria Plc has declared a bonus issue of 2 for 1, for which the closure of register is on the 22nd of January, 2009. Meanwhile, the company’s annual General Meeting is scheduled for the 27th of same January, 2009.

Fidson healthcare plc releases results, pays 20 kobo dividend.
Posted: 20 Jan 2009 03:46 AM PST
Health care and pharmaceutical giant, Fidson plc showed significant improvement in its financial year end results just made available to the exchange. It released its full year results for the period ended June 30, 2008 and its first quarter for the period ended September 30, 2008.
Turnover for the full year grew from N3.3 billion in 2007 to N4.5 billion in 2008. After tax profit however experienced a decline due to payment of taxation which the company was exempted from in 2007 from N505.3 million in 2007 to N189.3 million in 2008. Paid up capital increased from N89.2 million in 2007 to N750 million in 2008, while shareholders’ fund moved from N1.43 billion to N4.965 billion.
The company has proposed a dividend payment of 20 kobo per share which is a 7 kobo difference over the 13 kobo it last paid.

For the first quarter ended 30th September, 2008 it posted a turnover of N1.15 billion over the N617 million recorded in the same period of 2007. Profit after tax grew from N35 million in 2007 to N138 million in 2008.

Stock market update for 19-01-2009.

2009-01-20T10:32:00.000+01:00

At the close of market today key market index plunged further. The all share index dropped from 27,108.54 points which was recorded on Friday last week to 26,667 points. 7,987 deals were carried out involving a volume of 247,720,959 share valued at N1,714,330,115. Market capitalization closed lower from N6 trillion on Friday to N5.93 trillion.

On the gainers side Guinness led the chart as it gained N1.25 kobo to close at N74.25 kobo, BOCGAS added N0.90 kobo to close at N19.05, AIRSERVICE gained N0.68 kobo to close at N13.72 while UNIONDICON gained N0.44 kobo to close at N8.81 kobo.

Nestle led the losers chart lossing N9.09 kobo to close at N172.78 kobo, followed by Oando which lost N2.91 kobo to close at N72.00 kobo, NBC lost N1.40 kobo to close at N26.68 kobo while UACN closed at N8.81 kobo losing N1.35 kobo.

Investment myths to avoid in 2009 and beyond
Posted: 19 Jan 2009 05:48 AM PST
Few people living today base and live their lives on facts and the truth. A greater number however live their lives based on myths, thereby achieving very little tangible results. This is also prevalent in the investment world. Investors in the majority take decisions based on ideas and philosophies that have not stood the test of time. As expected, the result is always known ahead of time-LOSS OF CAPITAL.

Below are some myths about investment that should be avoided if your fortune in the stock market is to change in 2009 and beyond.

1.Anyone that invests in the stock market is bound to make a killing. Contrary to what most people believe which has pushed them into making stock investments, the market does not guaranty a bountiful harvest for everyone. People who invest based on this myth end up staring at the screen every day to see if stocks are in the green or the red. They don’t get a good night sleep because their anticipated profit comes by the action or inaction of other market participants. They don’t look inside a business before investing.

2. Stock investment is too complicated. Investing is simple and can be easy. Simple only if you play based on time tested rules and principles. Always research companies before you invest in them. Read annual reports of companies and understand what is being detailed out. Ask questions from those close to or directly involved in the business.

3. Initial public offers are the best. Always remember that new public offers come out at the most favorable time for the promoters of the stock. Instead of going for IPO’s, why not go for the already traded stocks that have being in circulation over the years. According to Warren Buffet, “great wealth does not flow to those who were early in an investment, but rather to those who saw the long term value of their investment.

4.When stocks decline, they will always move back up. This is what some people base their investment decisions on. They think and convince themselves that even though the price of the stock is declining, it will eventually return to its previous high. Instead, why not buy stocks that have had and will continue to have an increase in value.

Nigerian Stock Exchange: recently released results.

2009-01-20T10:29:00.000+01:00

Today some companies made available their financial results to dealing members of the exchange. Among results released were those of Unic insurance plc, Guinea insurance and Aso savings and loans plc.

Unic insurance plc.

The results of the insurance company for its third quarter ended 30th September 2008 showed an increase in its gross premium from N1.4 billion in comparative period of 2007 to N1.84 billion in 2008. It also grew its after tax profit to N365.25 million as against N281.85 recorded in 2007.

Guinea insurance plc.

Results of the company for the third quarter ended 30th September shows great improvement in key financial index. It recorded a turnover of N711.4 million compared to N202.21 recorded in the same period in 2007, this indicates a growth of 251.81 percent. Profit after tax saw an increase of 222.69 percent from N55.8 million in 2007 to n180.025 million in 2008. Profit before tax also increased in like manner to N228.78 million showing an increase of 228.07 percent.

Aso savings and loans plc.

The unaudited third quarter results of the company for the period ended 31st December 2008 shows an increase in its turnover from N6.2 billion in same period of 2007 to N7.9 billion in 2008. Profit after tax inched up by 78.37 percent from N680.596 million in 2007 to N1.214 billion in 2008.

Analyzing periodic financials (2)

2009-01-20T10:15:00.000+01:00

As a follow–up to the Growth in Turnover/Sales/Gross Earnings, one must equally consider the Earnings Growth. As a matter of fact, while the company’s level of activities is discernable in Turnover growth, its efficiency can be revealed in its earnings growth. Comparing the percentage growth in Turnover to the percentage growth in earnings shows how well cost has been managed or controlled in the periods compared. Cost control is crucial to profitability because it remains the only factor that can be controlled by the management of the company. Sales may be affected by recession or temporary unfavorable market conditions. Hence, reaching the optimal earnings for an increase in Turnover/Gross Earnings is a sign that the company’s board and management are on top of things.

Another very useful tip is to take a look at the dividend. Dividend is usually paid out of earnings, and the dividend payout ratio (dividend per share/earning per share) tells how much of the company’s earnings are retained for re-investment. It must be noted that the dividend policy of companies vary with the peculiarities in their industries. But then, a company paying above 75 per cent of its earnings may signal a warning, which could mean that the company may not be retaining enough for re-investment – talk about the long term vision of the company. Some players have also held that a high pay-out ratio may mean that the company’s earnings may be declining, or that the company is trying to entice investors. By and large, these figures must be interpreted with other qualitative factors taken into consideration as inferences would make more sense that way.

Analyzing periodic financials (1)
Posted: 17 Jan 2009 06:17 PM PST
Fundamental Analysis remains a vital tool in making investment decisions that are meant to stand the test of time – all other things being equal. The truth of this cannot be over–emphasized, particularly for that investor who has his eyes on the benefits that may accrue on his investment on the long run. For avoidance of doubt, Fundamental Analysis, according to the Financial Market Glossary authored by Mr. Remi Bakare, refers to “a method of securities analysis that tries to evaluate the intrinsic value of a particular stock…” which involves “…a study of the overall economy, industry condition(external factors), financial condition and management(internal factors) of a particular company”.

While this type of analysis would require expert appraisal in majority of its ramifications, the purpose of this piece is to educate investors on some basic comparisons (drawing from the internal factors, while holding external factors constant) that could be made to establish a basis for investing in a company’s future as it were. Some of the ways to derive data for the methods/techniques to be discussed later is through the annual report of the company. Better still, the published financials which could include the Income Statement and the Balance Sheet is helpful.

One of the things to look out for is the growth in the company’s Sales/Turnover or Gross Earnings as the case may be. It is important to consider this parameter because it is a portion of the Sales/Turnover that translates into the Net Profit or Income also known as the bottom line. An increasing turnover provides a higher probability for increased earnings. A decline may largely signify ineffective strategies, declining quality of company’s product or services, etc. As a matter of fact, it shows that the comparative level of activities between the past and current period have not been justified by the passage of time, experience and additional funds re-ploughed in terms of retained earnings. Analysts have recommended that an investor should not just seek growth, but have a benchmark of at least 10 per cent, from most recent historic figures, either quarterly or annually.

Analyzing periodic financials (20

2009-01-19T08:35:00.000+01:00

How to avoid investing mistakes

2009-01-18T12:51:00.000+01:00

Every genius we see today has undoubtedly made mistakes at one time in their lives. Mistakes most times are learning experiences for people. Some people would say “Learn from your mistakes” but i say “Why make mistakes when you can learn from other peoples mistakes?”. It is based on this that we would be taking a look at some investing mistakes that every would be successful investor should avoid. You may have heard some of these before, but lets remember that its not whether you have heard them - it’s a question of whether you have actually put them into practice.

1. Develop a philosophy
Every investor should have a philosophy or set of beliefs and values before going into the investment world. This would define the kind of stock bought and how available funds are allocated. An investor that believes in value stocks and companies that are shareholder friendly would most like allocate more if not all of the available capital to buy a stock like First Bank plc or UBA plc as against Japaul Oil plc or ABC Transport.

2. Avoid too much information
Information is definitely the oxygen required to make the right choices in stock investment. Too much of it however is not good as the investor ends up having challenges sifting out what is required to move ahead. The investor should seek out the basic information from trusted sources and not always pay attention to rumors. For what its worth, an investor should endeavor to always have the financial reports sent to shareholders at the end of each financial year. This piece of info gives a detailed description as to the general state of the business.

3. Concentrate.
Some investors believe that they spread their risk and are better off when they buy into many stocks. I would say they buy a few of a lot. This is very risky as it becomes difficult for the investor to accurately know whats happening in all the companies at one. Successful investors like Warren Buffet has always said that investors should buy a lot of a few. It helps them stay focused and a focused investor is potentially a successful one.

4. Understand your investments.
Always remember to read and do a thorough research before you send your broker the cheque. Always invest in businesses in which you understand their financials, products, services and people. CEOs are expected to make their activities open and simple for the average investor to comprehend. If that is not present in a business, then do not put in your money. Simply put, invest in companies that are TRANSPARENT.

5.Don’t sell too soon.
Jumping in and out of stocks is certainly not the best way to make it big in investment. The only time the investor should sell is when you realise that a mistake has been made. Understand that the falling price of a stock does not mean that that particular investment is a mistake. Allow time to run its course. After all, if indeed you believe that you picked right, why wake up one morning and think otherwise.

We can go on and on but the bottom line remains that the level of your rise or fall as an investor depends on the level to which you play by time tested rules. Invest wisely and live happily.

Academy Press release first and second quarter results for 2008
Posted: 16 Jan 2009 10:38 PM PST
Academy press yesterday made available two of its quarterly results to the Nigerian Stock Exchange. The first being its Profit and Loss accounts information for the first quarter ended 30th of June 2008. It recorded a Turnover of N376.052 million, as against preceding year comparable periods N425.556 million. The Profit Before Taxation was N6.935 million, as against preceding comparable periods N54.869 million. While, the Profit After Taxation also declined by 87.36 percent to N4.855 million, lower than preceding comparable year 2007’s N38.408 million.

The second quarter ended 30th of September 2008’s accounts information showed a declining earnings report too. The Turnover figure declined to N773.581 million, as against preceding year comparable periods N754.420 million. The Profit Before Taxation showed a figure of N11.133 million, as against preceding year’s comparable periods N62.535 million. While, the Profit After Taxation figure also declined to N7.793 million, as against preceding comparable periods N43.77 million, indicating an approximately 82.2 percent cut, in the net profit made for the share holders of Academy Press.

Nigerian stock market update for 16 January, 2009.
Posted: 16 Jan 2009 10:36 PM PST
Data from the Nigerian stock Exchange show’s a further declining market as the All Share Index (ALSI) dropped to 27,108.54 basis points, as against yesterday’s closing of 27,421.05 basis points. There were a total of 6,064 stock transactions involving a share volume of 150,470,106 units, worth N1.253 billion; as against yesterday’s 7,747 deals involving a volume of 255,346,864 unit shares, valued at N1.495 billion.The market capitalisation closed for the last trading day of the week at N6.032 trillion, as against yesterday’s N6.101 trillion.

The most traded stocks (volume wise), in a descending order: (1) FIDELITYBK led the activity chart by trading with 20,267,144 units, valued at N85,245,712.11; (2) PZ traded with 14,047,127 units, valued at N203,615,616.78; (3) BCC traded with 9,153,387 units, valued at N183,101,645.80; (4) FIRSTBANK traded with 8,397,027 units, valued at N159,167,525.41; while (5) ACCESS traded with 8,256,223 share units, valued at N48,033,009.56.

The top price gainers of the day in a descending order includes: (1) BCC appreciated by N0.99 to close at N20.98; (2) UBN gained N0.67 to close at N14.17; (3) DANGSUGAR gained N0.66 to close at N14.03; while (4) WAPIC gained N0.19 to close at N3.99.
On the other hand, the top price losers for the day in a descending order includes: (1) UACN which lost N1.50 to close at N28.65; (2) WAPCO lost N1.12 to close at N21.45; (3) GUINNESS lost N1.11 to close at N73.00; while (4) UAC-PROP lost N0.89 to close at N20.00

FTN Cocoa to benefit from rising cocoa prices

2009-01-14T05:17:00.000+01:00

What most investors have been terming as a hunch is beginning to become concrete signals of increased earnings for FTN cocoa plc. This is due to the rising cost of cocoa prices in the international market.

Information from international sources at at January 13, 2009 clearly indicated that cocoa futures have hit its highest price in 23 years. It is reported that the commodity is on high demand compared to a lapse in supply. Africa which is known to be one of the largest producers of the commodity is said to be experiencing a fall in production currently.

FTN Cocoa plc is therefore positioned to benefit from the rising price of cocoa as it is a major exporter of the commodity amongst other Nigerian players. Some of its international customers include:

Unicom International Bv, Zaamdam, Amsterdam
All Trade International, Paris
Theobroma International Bv, Amsterdam/ED & FMAN COCOA.
Armajaro International, UK
Union Chocolate, Poland Delfi Nord Cacao, France/Amsterdam
Indcresa, Barcelona, Spain.
It would be recalled that the company had a private placement last year and was listed on listed on the exchange in the same year. According to the earnings forecast in the offer prospectus, profit after tax for 2008, 2009 and 2010 was pegged at N596,400,000, N735,000,000 and N870,100,000 respectively. Earnings per share was pegged at N0.30, N0.37 and N0.44 for 2008, 2009 and 2010. Consequently, dividend forecast has been pegged at N0.10, N0.15 and N0.20 for the next 3 years effective 2008.

NSE Weekly Market Report (Jan 9 2009)

2009-01-12T11:45:00.000+01:00

A turnover of 1.045 billion shares worth N7.25 billion in 34,103 deals was recorded last week, in contrast to a total of 991.8 million shares valued at N6.42 billion exchanged the week before in 23,733 deals.

There were no transactions in the Federal Government Development Stocks, State Government Bonds and Industrial Loans/Preference Stocks sectors.

The Banking subsector was the most active during the week (measured by turnover volume), with 492.6 million shares worth N4.72 billion exchanged by investors in 18,265 deals. Volume in the Banking subsector was largely driven by activity in the shares of Fidelity Bank Plc, Guaranty Trust Bank Plc and Oceanic Bank International Plc. Trading in the shares of the three banks accounted for 199.13 million shares, representing 40.43% of the subsector’s turnover.

The Insurance subsector, boosted by activity in the shares of Continental Reinsurance Plc, followed on the week’s activity chart with a turnover of 251.15 million shares valued at N392.8 million in 3,342 deals.

Last week, the Banking subsector led on the activity chart and was followed by the Insurance subsector.

Price Movement:

The All-Share Index dropped by 7.94% to close on Friday at 28,866.80. The market capitalization of the 198 First -Tier equities closed lower at N6.4 trillion.

Nine (9) stocks appreciated in price during the week, lower than the fifty - six (56) in the preceding week. Oando Plc led on the gainers’ table with a gain of N4.17 to close at N82.18 per share while PZ Cussons Nigeria Plc followed with N2.05 to close at N13.85 per share. Other price gainers in the Top 10 category include:
Cement Co. of Northern Nigeria Plc N1.50
International Breweries Plc N0.78
Big Treat Plc N0.15
Regency Alliance Insurance Plc N0.14
Neimeth International Pharmaceutical Plc - N0.11
Multiverse Resources Plc N0.07
Intercontinental WAPIC Insurance Plc N0.02

Eighty - Five (85) stocks depreciated in price during the week, higher than the thirty – nine (39) in the preceding week. Also, as in the preceding week, Chevron Oil Nigeria Plc led on the price losers’ table, dropping by N15.41 to close at N144.50 per share while Guinness Nigeria Plc followed with a loss of N15.11 to close at N82.90 per share. Other price losers in the Top 10 category include:

Total Nigeria Plc N10.18
Nestle Nigeria Plc N9.57
Nigerian Bottling Company Plc N5.25
UACN Property Dev. Co. Plc N4.63
Flour Mills of Nigeria Plc N4.50
Cadbury Nigeria Plc N3.22
Intercontinental Bank Plc N3.01
Nigerian Breweries Plc N2.60

COMPANY NEWS

SKYE BANK PLC: Unaudited result for the first quarter ended 31st December 2008 shows Gross Earnings of N27.9 billion, as against N12.55 billion in the comparable period of 2007. Profit after tax stood at N5.9 billion compared with N2.85 billion in 2007.

NAMPAK NIGERIA PLC: Audited result for the year ended 30th September 2008 shows Turnover of N3 billion as against N2.85 billion in 2007. Loss after tax and exceptional items stood at N231.02 million compared with N145.92 million in 2007.

CADBURY NIGERIA PLC: Audited result for the year ended 31st December 2007 shows Turnover of N19.94 billion as against N19.21 billion in 2006. Loss after tax stood at N727 million compared with loss after tax and exceptional items N4.7 billion in 2006.

STANBIC IBTC NIGERIAN EQUITY FUND: Audited result for the year ended 31st December 2008. The Fund Managers are recommending a distribution of N110.00 per Unit. The Fund Register of Unitholders would be closed on January 27, 2009 while payment date would be advised later.

COMPANY FORECASTS

ASSOCIATED BUS COMPANY PLC: The Company forecasts a Turnover of N1.25 billion and profit after tax of N99.82 million during the first quarter ending March 31, 2009.

Own share buy-back and circuit breakers yet to affect the market (2)

2008-11-06T06:54:00.000+01:00

Hope you read my recent article on “own share buy-back yet to affect the market”, it would be good to emphasize the issue of buy back provisions and rules. In a Securities and Exchange Commission published circular, dated 11th September 2008, the “Amendments to rules and regulations of the Securities and Exchange Commission, Rules on share Buy-Back.” http://www.sec.gov.ng/themes/default/pdfs/notices/circular.pdf
Some of the features in the amended rule 109B – Rules Relating to Acquisition of Own Shares by Companies, summarily includes: (1) A company can only purchase a maximum of 15 percent of its own existing issued and paid up equity shares, within a given financial year; (2) An illiquid company is prohibited from own-share-buy-back operations, as such the company’s Residual debt to Equity ratio should not be greater than ratio 2:1; (3) shares can only be re-purchased out of Share premium or distributable profit; etc.

The eagerness and volume of own shares these Nigerian Stock Exchange listed mega companies are willing to buy, will be a very strong indication of how buoyant they really are in terms of spendable profit, giving a clearer view of their true worth. More importantly it will lessen their equity liability to share holders, thereby reducing the number of share ranking for dividend.
Previously, the position of the ‘Company and Allied Matters Act 2004’, on this issue as stated in sections 160, 161 and 162 prohibits any company from acquiring its own shares safe for some narrow provisions contained in subsection (2) of section 160 of this act. Section 160 subsection (2) states that a company may only acquire its own shares for such purpose(s) as: (a) settling or compromising a debt or claim asserted by or against the company; or (b) eliminating fractional shares; or (c) fulfilling the terms of a non-assignable agreement under which the company has an option or is obliged to purchase shares owned by an officer or an employee of the company; (4) satisfying the claim of a dissenting shareholder; etc. Enough of business law, the point is that there used to be a strong legal restriction on companies before now prohibiting them from ordinarily purchasing their own shares from any secondary market. It’s now time to distinguish the boys from the men within the Nigerian capital market.

Nigerian Stock Exchange. Banks agree to restructure loans.

2008-11-05T08:44:00.001+01:00

Few days after the major world capital markets have had sustained upward movements, Nigerian banks have indicated their readiness to restructure loan facilities extended to investors.

This might come as good news to thousands of investors that have made serious losses and consequently incurred huge debts as a result of the down trend that has bewildered the stock market in the past 7 months. It is no news that the banking sector had given out billions of naira as margin facility to investors to purchase shares.
This singular action is believed by many as one of the major reasons behind the current market situation as share prices sored during the period the loans were made available. Stocks were therefore overpriced and the aftermath effect is what is been witnessed now.

The banks have now agreed to spread the existing loans between 6 months to a year in addition to the existing terms of loans already given. Although this action is a positive one, investors still insist that government should find a permanent solution to the stock market crisis as this is just a temporary one.

stcok market report for 28/08/2008

2008-08-29T15:54:00.000+01:00

The bulls had another positive day as the All Share Index closed upward by 46,312.27 base points as against yesterday’s. A total of 7,187 deals, involving a volume 484,975,918 of unit shares valued at N5,152,414,346.24 were traded today; as against yesterday’s total of 8,672 deals involving a total of 1,054,205,586 unit shares, valued at N14,870,507,827.02. The Market Capitalisation also appreciated to N9,443 trillion as against yesterday’s N9.088 trillion.

The top traded shares of the day included: (1) IANSURE traded with a volume of 84,274,173 unit shares valued at N62,362,888.02; (2) ACCESS traded 69,179,403 unit shares valued at N876,503,036.01; (3) WEMABANK traded 46,456,410 unit shares valued at N696,846,150.00; (4) FTNCOCOA traded 42,400,000 unit shares valued at N93,306,000.00; while (5) FIDELITYBK traded 29,757,832 unit shares valued at N229,027,242.57.
The top price gainers of the day included: (1) CHEVRON which gained N21.00 to close at N441.00; (2) OANDO gained N6.06 to close at N127.26; (3) GUINNESS gained N5.99 to close at N125.88; while (4) FLOURMILL gained N3.09 to close at N65.08.
On the other hand, the top price losers of the day included: (1) MOBIL which lost N3.59 to close at N355.69; (2) RTBRISCOE lost N0.19 to close at N19.10; (3) DNMEYER lost N0.10 to close at N10.65; while (4) IPWA lost N0.04 to close at N4.76.

Afrinvest opens N5bn Equity fund

2008-08-12T11:39:00.000+01:00

Afrinvest West Africa (Afrinvest), Member of the Nigerian Stock Exchange (NSE) has today August 11, 2008 opened its N5.0 billion Initial Public Offer (IPO) in the Afrinvest Equity Fund (Authorised and Registered in Nigeria as a Unit Trust Scheme).

This is contained in an electronic copy of the Offer made available to Proshare NI in Lagos Nigeria.

The company in the Prospectus affirms that the minimum investment one or joint Unit holder(s) may make in the Fund is N50, 000.00 representing 500 Units of the Fund at a price of N100 per unit. “The unit of sale is 500 Units and multiples of 100 Units thereafter” the Prospectus stated.

“Thereafter, additional Units in the Fund shall be issued in multiples of N10, 000.00 and shall be subscribed for in those multiples” the document further affirmed.

In the same vein, Afrinvest also confirmed that the fund is open-ended and investors will be free to subscribe to its units through the Manager or any other Agents approved by the Manager after the IPO.

“Therefore, although the Fund has an initial target size of 50,000,000 Units, the Fund Manager will issue additional Units of the Fund to subscribers on demand after the initial tranche of 50,000,000 Units has been fully subscribed, subject to Securities & Exchange Commission’s (SEC’s) approval of the additional units” the company said.

However, 10 percent of the Offer has been preferentially allotted to Afrinvest West Africa Limited.

This allotment is in compliance with current regulations issued by SEC that promoters of unit trust schemes in Nigeria must subscribe to a minimum of 10 percent of the initial issue of such schemes.

However, the Five-Year financial summary of the Fund Manager as contained in the Prospectus and extracted without adjustment from its audited financial statements for the nine months ended December 31, 2007 and Five-Years Ended March 31, 2007.

Gross Earnings of the company increased from N162.560 million in year 2003 to N1.433 billion in the nine months ended December 31, 2007 indicating an increase of 782 percent in the review period.

While Profit before Tax (PBT) also grew from N5.088 million in year 2003 to N259, 780 million in the nine months ended December 31, 2007 representing a growth of 5006 percent in the period under review.

Profit after Tax (PAT) also rose from N1.152 million in year 2003 to N236.695 million; also in the nine months ended December 31, 2007; showing a rise of 20446 percent.

Issuing House to the offer is Guaranty Trust Bank Plc (GTbank); application list opens today Monday August 11, 2008 and closes Wednesday September 17, 2008.

more info/news at www.nigerianstock.tk

NSE Weekly Market Report (August 1)

2008-08-03T08:09:00.000+01:00

A turnover of 3.11 billion shares worth N38.16 billion in 72,680 deals was recorded this week, in contrast to a total of 4.05 billion shares valued at N43.75 billion exchanged last week in 73,782 deals.

There were no transactions in the Federal Government Development Stocks, State Government Bonds and Industrial Loans/Preference Stocks sectors.

The Insurance subsector was the most active during the week (measured by turnover volume), with 1.3 billion shares worth N2.05 billion exchanged by investors in 10,433 deals. Volume in the Insurance subsector was largely driven by activity in the shares of Investment and Allied Assurance Plc. Trading in the shares of the Insurance
Company accounted for 811.8 million shares, representing 62.7% of the subsector’s turnover.

The Banking subsector, boosted by activity in the shares of First City Monument Bank Plc and Fidelity Bank Plc, followed on the week’s activity chart with a turnover of 1.2 billion shares valued at N24.65 billion in 37,592 deals.

Last week, the Insurance subsector led on the activity chart and was followed by the Banking subsector.

Price Movement:
The All-Share Index rose by 4.04% to close on Friday at 52,641.55. The market capitalization of the 209 First -Tier equities closed higher at N10.55 trillion.
Eighty (80) stocks appreciated in price during the week, higher than the nineteen (19) in the preceding week. Mobil Oil Nigeria Plc led on the gainers’ table with a gain of N33.80 to close at N254.00 per share while Julius Berger Nigeria Plc followed with N25.91 to close at N146.24 per share. Other price gainers in the Top 10 category include:

• Flour Mills Nigeria Plc - N8.05

• Unilever Nigeria Plc - N4.97

• Benue Cement Company Plc - N4.85

• Cadbury Nigeria Plc - N4.70

• UACN Plc - N4.42

• PZ Cussons Nigeria Plc - N4.13

• Guinness Nigeria Plc - N4.00

• UACN Property Development Co. Plc - N3.99

Twenty – Six (26) stocks depreciated in price during the week, lower than the ninety-two (92) in the preceding week. Three Petroleum (Marketing) Stocks led on the losers table. Chevron Oil Nigeria Plc led dropping by N46.05 to close at N213.76 per share while Oando Plc followed with a loss of N17.99 to close at N170.01 per share. Other price losers in the Top 10 category include:

• Total Nigeria Plc - N9.50

• Nig. Enamelware Plc . - N8.61

• Nestle Nigeria Plc - N4.24

• 7-Up Bottling Co. Plc - N2.58

• G Cappa Plc - N1.47

• PlatinumHabib Bank Plc - N1.46

• Neimeth International Pharmaceuticals Plc - N1.43

• Ashaka Cement Plc - N1.00

Two equity prices were adjusted for dividend as recommended by the Board of Directors. Access Bank Plc was adjusted for dividend of N0.65 per share while NEM Insurance Plc was adjusted for dividend of N0.05 per share.

COMPANY NEWS
CONOIL PLC: Audited result for the year ended 31st December 2007 shows Turnover of N86.85 billion as against N90.52 billion in 2006. Profit after tax stood at N2.6 billion compared with N2.81 billion in 2006. The Directors are recommending a dividend of N2.75 per share. The date of closure of register of members is August 4, 2008 while payment date is September 19, 2008.

PZ INDUSTRIES PLC: Audited result for the year ended 31st May 2008 shows Turnover of N65.94 billion as against N54.22 billion in 2007. Profit after tax, exceptional items and minority interest stood at N3.95 billion compared with profit after tax and minority interest of N3.51 billion in 2007. The Directors are recommending a dividend of N0.62 per share. The date of closure of register of members is August 25, 2008 while payment date is September 11, 2008.

CAPPA & D”ALBERTO PLC: Audited result for the year ended 31st December 2007. The Directors are recommending a dividend of N0.50 per share. The date of closure of register of members is October 2, 2008 while payment date would be advised later.

ASSOCIATED BUS COMPANY PLC: Audited result for the year ended 31st December 2007 shows Turnover of N3.13 billion as against N2.71 billion in 2006. Profit after tax stood at N141.25 million compared with N143.01 million in 2006. The Directors are recommending a dividend of N0.08 per share. The date of closure of register of members is August 7, 2008 while payment date is September 7, 2008.

ASO SAVINGS & LOANS PLC: Audited result for the year ended 31st March 2008 shows Gross Earnings of N7.1 billion as against N2 billion in 2007. Profit after tax stood at N1.1 billion compared with N276.62 million in 2007. The Directors are recommending a dividend of N0.05 per share. The date of closure of register of members is October 6, 2008 while payment date is October 24, 2008.

LASACO ASSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N1.84 billion as against N1.6 billion in 2006. Profit after tax stood at N678.11 million compared with N171.35 million in 2006. The Directors are recommending a dividend of N0.08 per share. The date of closure of register of members is August 8, 2008 while payment date is September 4, 2008. The 28th Annual General Meeting (AGM) of shareholders is scheduled to hold on Thursday, September 4, 2008 by 11.00a.m. The venue would be advised later

ROYAL EXCHANGE ASSURANCE (NIG) PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N2.7 billion as against N2.14 billion in 2006. Profit after tax stood at N543.64 million compared with profit after tax and exceptional items of N178.71 million in 2006. The Directors are recommending a bonus of 1 for 10. The date of closure of register of members was June 30, 2008.

GREAT NIGERIA INSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N608.04 million as against N289.74 million in 2006. Profit after tax stood at N90.25 million compared with loss after tax of N155.35 million in 2006.

GREAT NIGERIA INSURANCE PLC: Unaudited result for the half year ended 30th June 2008 shows Gross Premium of N563.7 million, as against N425.2 million in the comparable period of 2007. Profit after tax stood at N85.4 million compared with N75.85 million in 2007.

NEM INSURANCE PLC: Unaudited result for the half year ended 30th June 2008 shows Gross Premium of N2.32 billion, as against N1.31 billion in the comparable period of 2007. Profit after tax stood at N560.92 million compared with N213.8 million in 2007.

OASIS INSURANCE PLC: Unaudited result for the half year ended 30th June 2008 shows Gross Premium of N521.35 million, as against N158.01 million in the comparable period of 2007. Profit after tax stood at N138.05 million compared with N17.11 million in 2007.

CORNERSTONE INSURANCE PLC: Unaudited result for the half year ended 30th June 2008 shows Gross Premium of N2.13 billion, as against N1.7 billion in the comparable period of 2007. Profit after tax stood at N438.7 million compared with N330.52 million in 2007.

ASHAKA CEMENT PLC: Audited result for the year ended 31st December 2007 shows Turnover of N16.5 billion as against N16.8 billion in 2006. Profit after tax stood at N1.6 billion compared with N3.4 billion in 2006. The Directors are recommending a bonus of 1 for 6. The date of closure of register of members is August 25, 2008

ECOBANK TRANSNATIONAL INCORPORATED: Unaudited result for the half year ended 30th June 2008 shows Gross Revenue of N61.3 billion, as against N38.02 billion in the comparable period of 2007. Profit after tax stood at N9.0 billion compared with N6.6 billion in 2007.

OANDO PLC: Unaudited result for the half year ended 30th June 2008 shows Turnover of N124.41 billion, as against N106 billion in the comparable period of 2007. Profit after tax stood at N3.7 billion compared with profit after tax and exceptional items of N2.31 billion in 2007.

STERLING BANK PLC: Unaudited result for the third quarter ended 30th June 2008 shows Gross Earnings of N27.1 billion, as against N16.01 billion in the comparable period of 2007. Profit after tax stood at N4.6 billion compared with N2.5 billion in 2007.

RT BRISCOE (NIG) PLC: Unaudited result for the half year ended 30th June 2008 shows Turnover of N9.03 billion, as against N8.01 billion in the comparable period of 2007. Profit after tax stood at N391.1 million compared with N326.04 million in 2007.

IKEJA HOTEL PLC: Unaudited result for the half year ended 30th June 2008 shows Turnover of N3.22 billion, as against N2.5 billion in the comparable period of 2007. Profit after tax stood at N555.61 million compared with N397.84 million in 2007.

LAFARGE WAPCO PLC: Unaudited result for the half year ended 30th June 2008 shows Turnover of N22.2 billion, as against N19.9 billion in the comparable period of 2007. Profit after tax stood at N4.75 billion compared with N5.82 billion in 2007.

TRIPPLE GEE & CO. PLC: Unaudited result for the first quarter ended 30th June 2008 shows Turnover of N225.6 million, as against N161.82 million in the comparable period of 2007. Profit after tax stood at N26.14 million compared with N16.9 million in 2007.

FIRST ALUMINIUM NIGERIA PLC: Unaudited result for the half year ended 30th June 2008 shows Turnover of N4.28 billion, as against N4.3 billion in the comparable period of 2007. Loss after tax stood at N13.82 million compared with N171.7 million in 2007.

INVESTMENT & ALLIED ASSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N675.7 million as against N159.2 million in 2006. Profit after tax stood at N304.65 million compared with N54.64 million in 2006. The Directors are recommending a dividend of 0.8 kobo per share. The date of closure of register of members is August 8, 2008 while payment date is September 8, 2008.

INVESTMENT & ALLIED ASSURANCE PLC: Unaudited result for the half year ended 30th June 2008 shows Gross Premium of N611.93 million, as against N354.2 million in the comparable period of 2007. Profit after tax stood at N252.9 million compared with N136.8 million in 2007.

REPORT ON THE OTC MARKET FOR FGN BONDS
A turnover of 371.63 million units worth N368.14 billion in 3413 deals was recorded this week, in contrast to a total of 232.62 million units valued at N232.6 billion exchanged in 2001 deals during the week ended July 24, 2008. As in the preceding week, the most active bond (measured by turnover volume) was the 5th FGN Bond 2018 Series 2 with a traded volume of 34.85 million units valued at N31.51 billion in 287 deals.

Starcomms & Cadbury Plc Updates.

2008-07-21T07:40:00.000+01:00

Starcomms Plc blazes the trail on the telecommunication sub sector.

Starcomms Plc, a telecommunications outfit, was commercially launched in 1999 and its deployment of the world class CDMA technology in 2002 has exponentially taken the company to its current position of over 1,000,000 customers in Lagos, Kano, Maiduguri, Port-Harcourt, Ibadan, Abuja, Aba,Onitsha, Asaba, Kaduna, Zaria and Benin. In 2002 the company introduced a revolutionary marketing strategy aimed at permanently changing the fixed/wireless industry for the better. The strategy focused on the need to improve customer service quality and network performance.

The company took additional strides as the leading PTO in December 2003 when it deployed an Intelligent Network technology in Nigeria. History was made in December 2003 when Starcomms introduced its Intelligent Network, the next generation of wireless services, in Kano, Nigeria. Starcomms has maintained a distinct business approach that combines technological novelty and excellence with good customer orientation and a unique branding concept that stands it out amongst pairs. The company, which is managed by a team of professionals led by the Chief Executive Officer, Mr. Maher Qubain, holds strategic alliances with Qualcomm, CDG, Huawei, Hisense, Harris, Haier, LG and Nera to provide cutting edge technological equipments to deliver on its service promise.

Starcomms made its debut in the telecommunications sub sector of the Nigerian Stock Exchange last week by listing a total of 6.9 billion ordinary shares of 50 kobo each at N13.65 per share by way of introduction.

Cadbury Plc placed on full suspension

Recent developments have revealed that the last has not been heard of the Cadbury Plc’s financial misstatement saga that was uncovered about two years ago, involving its former Managing Director, Financial Controller and some other principal officers. The Investment and Securities Tribunal, last week enforced a full suspension sanction on the company’s shares. This sanction was initially intended by the Securities and Exchange Commission, but countered by the Nigerian Stock Exchange for lack of a legal backing. However, the Investment and Securities Tribunal, a court of competent jurisdiction on investment matters has imposed the penalty, leaving the Nigerian Stock Exchange with no other option but to consent.

Nevertheless, Cadbury Plc has stated that ever since the misstatement matters came into the limelight, the company had consistently cooperated with the regulators, and would continue to search for justice through the law courts.

First Registrars notifies investors on 17 offers of companies

2008-07-20T00:39:00.001+01:00

-set to reissue certificates within 7 days
First Registrars Nigeria Limited had notified investors who took part in 17 different offers of its client companies; on the non-receipt of their share certificates, return money and interest warrants; as it is set to reissue certificates within seven days.

Niran Adetunji, Head, Finance & Accounts of the company affirmed this to Proshare NI today in Lagos Nigeria.

Adetunji affirmed that First Registrars is ready to package an indemnity to investors who had not yet received their share certificates from the recent offers handled by it for their various client companies.

“For those who have not yet received their share certificates for the various companies we have handled their offers as Registrars, they should send a formal letter and we would package an indemnity for them within seven days and issue them the duplicate” he said.

A list of the companies as published in First Registrars notice to investors in about 10 dailies; Adetunji affirmed include ARM Aggressive Growth Fund, Platinum Habib Bank Plc (Bank PHB) Costain West Africa Plc, DEAP Capital Management and FBN Heritage Fund offers of 2007 respectively.

Others are Fidelity Bank Plc’s 2005 offer and 2007 Rights/offer respectively, First Bank of Nigeria Plc’s (FBN’s) 2003 Rights and 2007 Rights/offers respectively.

On the list is also StanbicIBTC Ethical Fund offer of 2005, StanbicIBTC Bank offer 2005, Kakawa Guaranteed Income Fund offer 2007, Oando Plc’s Rights/offer of 2004.

There are also the Oasis Insurance Plc’s Rights/offer of 2007, Prestige Assurance Plc’s and Standard Alliance Insurance Plc’s offers of 2006 respectively and the IBTC Guaranteed Investment Fund offer of 2007.

The above is a total of 17 offers from different companies. Adetunji further affirmed to Proshare NI that First Registrars would reissue physical share certificates or direct crediting to the investors Central Security Clearing System Limited (CSCS) accounts; if furnished and indicated while filling the indemnity form.

He also confirmed to Proshare NI that the Committee set up by Securities & Exchange Commission (SEC) on the issue of Infrastructure upgrade and monitoring of Registrars to ensure market transparency; visited First Registrars unnoticed.

Adetunji further confirmed to Proshare NI that the Committee was satisfied with the infrastructure put in place by First Registrar to run its operations.

Some of the facilities on ground, Adetunji affirmed include three Data Capturing Machines, Scanner for converting forms to data and a Call Centre

Intl Energy Insurance to raise N10bn fresh funds

2008-07-20T00:36:00.000+01:00

International Energy Insurance Plc (IEI) is to approach the Nigerian Capital Market to raise fresh funds of N10 billion. Jacob Erhabor, Managing Director/ Chief Executive Officer (MD/CEO) of the company made this affirmation to Proshare NI in Lagos Nigeria.

“IEI is proposing to raise additional funds of N10 billion, it is on the table and we are trying to conclude with the plans” Erhabor said.

He affirmed that the offer would likely open before the end of the current quarter. “Before the end of this quarter, we should actualise it” he said.

As at the time of filling in this report, Erhabor confirmed to Proshare NI that the offer price has not yet been fixed; as it is a function of a number of issues.

“I would not want to make a guess as regards the offer price; it has to be based on certain fundamentals” he affirmed.

He however, confirmed to Proshare NI that IEI has not gone to the Quotations Committee of the Nigerian Stock Exchange (NSE) to present its proposal of raising fresh funds. “There are so many things to be put in place” Erhabor said.

“Today, I can assure you that IEI has about N12 billion to do its business successfully” he affirmed.

The company was subsequently recapitalised to N500 million to meet with the challenges of its new business focus. IEI has since increased its authorised share capital to N6, 000,000,000 comprising of 12,000,000,000 ordinary shares of 50 kobo”

In the same vein, the insurance company has proposed to give its investors a 0.9 Kobo dividend payout in its current Financial Year End (FYE).

Erhabor further confirmed to Proshare NI, that the 0.9 Kobo dividend payout being proposed to investors; is the beginning of good returns to their investment in the company.

However, the 0.9 Kobo dividend is subject to the approval of the company’s Board at its forthcoming Annual General Meeting (AGM).

Also, as at the time of filling in this report, Proshare NI could not gather further details concerning the proposed N10 billion Public Offer (PO) of IEI.

NGC declares 45 kobo dividend

2008-07-18T04:43:00.000+01:00

Nigerian-German Chemicals Plc has declared a dividend of 45 kobo, amounting to N69m for shareholders in its 2007 financial results.

This represents an increase by 29 per cent over the 35 kobo paid in 2006.

The company recorded a turnover of N2.63bn, representing an increase by 5.6 per cent over N2.49bn recorded the previous year. Its profit after tax, however, fell by 22 per cent to N56.9m from N73.3bn in 2006.

Speaking at the company’s annual general meeting on Tuesday, The National Chairman, Dynamic Shareholders Association of Nigeria, Mr. Alex Adio, congratulated the board of the company for its results, and hoped that by the next financial year, the company would perform better.

“Shareholders are impressed that although the profit you recorded this year was lower than that of last year, you still declared a higher dividend,” he said.

Also speaking, the President, Shareholders Solidarity Association, Chief Timothy Adesiyan, stated that the company should ensure the utilisation of its infrastructure in order to enhance productivity.

He urged the management to look into the amount spent on energy, stating that it was on the high side.

The company should look for a solution to the problem, he said.

The Chairman, NGC, Alhaji Shehu Idris, in his response, stated that the company had strategies in place for the next financial year to ensure profitability.

Idris, who was represented by the company’s Vice Chairman, Mr. Adeboye Shonekan, said , owing to this, the company would be seeking to raise fresh capital through a hybrid of rights and bond issues.

UBA Declares N28.85 Billion Profit After Tax

2008-07-18T04:39:00.000+01:00

United Bank for Africa Plc (UBA)’s third quarter unaudited results for its 2008 financial year, shows that the Bank is well on track to meeting and surpassing the expectations of its numerous stakeholders.

Drawing inference from the disclosed figures, stakeholders of the bank can be certain of another rewarding year for their investments in the financial institution.

The unaudited results, recently released to the Nigerian Stock Exchange, show a 59.8 per cent increase in the bank’s earnings and growth in its market share. Gross Earnings for the 6 months under review was N120.25 billion, a N45 billion appreciation over the N75.25 billion recorded for the corresponding period last year. This significant increase in earnings, can be attributed to increased customer-patronage resulting from the quality of service and products offered by the bank.

Profit before tax appreciated by 68.31 per cent, with the bank reporting a N33.14 billion PBT in comparison with the N19.69 billion reported last year. The bank’s N28.85 billion profit after tax for the 6 months under review, is also a 6668.42 per cent appreciation over the figure reported last year.

According to financial analysts and industry watchers, the bank’s first quarter results are an indication of good times for its shareholders, if dividend payout for the last financial year are anything to go by.

Bank’s results with that of its peers, shows that it had emerged as the fastest growing in the country.

Nse Market Report For Week 28 (july 11)

2008-07-12T13:43:00.000+01:00

A turnover of 5.8 billion shares worth N42.12 billion in 88,146 deals was recorded this week, in contrast to a total of 4.8 billion shares valued at N41.96 billion exchanged last week in 77,288 deals.

Transactions during the week included a total of 1,000 units of Access Bank Plc N13.5 billion Redeemable Bond 2010 valued at N1 million.

There were no transactions in the Federal Government Development Stocks, State Government Bonds and Industrial Loans/Preference Stocks sectors.

The Insurance subsector was the most active during the week (measured by turnover volume), with 3.83 billion shares worth N4.6 billion exchanged by investors in 16,880 deals. Volume in the Insurance subsector was largely driven by activity in the shares of Investment and Allied Assurance Plc. Trading in the shares of the Insurance Company accounted for 3.31 billion shares, representing 86.35% of the subsector’s turnover.

The Banking subsector, boosted by activity in the shares of Fidelity Bank Plc, Intercontinental Bank Plc and FirstInland Bank Plc, followed on the week’s activity chart with a turnover of 1.5 billion shares valued at N30.25 billion in 40,848 deals.

Last week, the Insurance subsector led on the activity chart and was followed by the Banking subsector.

Price Movement:
The All-Share Index dropped by 1.43% to close on Friday at 54,662.06. The market capitalization of the 208 First -Tier equities closed lower at N10.85 trillion.

Thirty - Two (32) stocks appreciated in price during the week, lower than the seventy-four (74) in the preceding week. Mobil Oil Nigeria Plc led on the gainers’ table with a gain of N20.17 to close at N217.04 per share while Chevron Oil Nigeria Plc followed with N16.51 to close at N372.00 per share. Other price gainers in the Top 10 category include:

• Guinness Nigeria Plc - N4.99

• Oando Plc - N3.99

• BOC Gases Plc - N2.91

• First Bank of Nigeria Plc - N1.91

• First City Monument Bank Plc - N1.85

• Ecobank Transnational Inc. - N1.72

• Eterna Oil & Gas Plc - N1.49

• PZ Cussons Nigeria Plc - N1.41

Eighty - One (81) stocks depreciated in price during the week, higher than the thirty-eight (38) in the preceding week. Dangote Sugar Refinery Plc led on the price losers’ table, dropping by
N4.01 to close at N29.99 per share while Presco Plc followed with a loss of N73.59 to close at N12.39 per share. Other price losers in the Top 10 category include:

• Cadbury Nigeria Plc - N2.30

• United Bank for Africa Plc. - N2.20

• Dangote Flour Mills Plc - N2.18

• Japaul Oil & Maritime Services Plc - N2.05

• Oceanic Bank International Plc - N1.78

• DN Meyer Plc - N1.68

• May & Baker Nigeria Plc - N1.58

• Prestige Assurance Co. Plc - N1.46

Four equity prices were adjusted for dividend and/or bonus as recommended by the Board of Directors. Big Treat Plc was adjusted for dividend of N0.10 per share. Prestige Assurance Plc was adjusted for dividend of N0.20 per share and bonus of 1 for 4. International Energy Insurance Plc was adjusted for dividend of N0.09 per share. Longman Nigeria Plc was adjusted for dividend of N1.00 per share.

…Supplementary Listings
A total of 429,996,932 shares were added to the shares outstanding in the name of Prestige Assurance Plc following the bonus of 1 for 4. Also, a total of 223,000,834 shares were added to the shares outstanding in the name of Access Bank Plc on Tuesday, July 8, 2008 following the conversion of part of the bank’s N13.5 billion Redeemable Bond 2010. Similarly, a total of 12,499,487,995 shares were added to the shares outstanding in the name of Fidelity Bank Plc on Tuesday, July 8, 2008 following the conclusion of hybrid offer made up of public offering of 5,501,100,421 shares, Rights offering of 498,899,579 shares and supplementary allotment of 6,498,899,579 shares.

Change of Name and Sector Reclassification
The name of Crusader Insurance (Nig) Plc was changed to Crusader (Nig) Plc following business restructuring. Also, the company was moved from the Insurance sector and listed in the “Other Financial Institutions” sector.

Delisting
The N2.46 billion Special FGB Bond 2012 for Local Contractors Debt was delisted from the Daily Official List. By this action, the number of FGN Bonds and securities dropped to 41 and 316 respectively.

Technical Suspension
This was imposed on Eterna Oil & Gas Plc on Thursday, July 10, 2008 on receiving the Company’s application to undertake supplementary share offering. Also, it was imposed on First Aluminium Nigeria Plc on Friday, July 11, 2008 on receiving the Company’s application to undertake supplementary share offering.
COMPANY NEWS
INTERCONTINENTAL BANK PLC: Unaudited result for the first quarter ended 31st May 2008 shows Gross Earnings of N60.9 billion, as against N28.75 billion in the comparable period of 2007. Profit after tax stood at N7.82 billion compared with N4.7 billion in 2007.

C & I LEASING PLC: Audited result for the year ended 31st January 2008. The Directors had earlier recommended a final dividend of N0.06 per share. The date of closure of register of members is August 4, 2008 while payment date is August 28, 2008.

SOVEREIGN TRUST INSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N2.5 billion as against N1.42 billion in 2006. Profit after tax stood at N357.8 million compared with N233.8 million in 2006. The Directors are recommending a dividend of N0.06 per share and bonus of 1 for 5. The date of closure of register of members is July 23, 2008 while payment date is September 7, 2008. The Annual General Meeting (AGM) of shareholders is scheduled to hold at Diamond Hall, Golden Gate Restaurant, 25B Glover Road, Ikoyi, Lagos on Tuesday, August 12, 2008.

STACO INSURANCE PLC: Audited result for the year ended 31st December 2007. The Directors earlier recommended a dividend of N0.12 per share. The date of closure of register of members is July 21, 2008 while payment date is August 4, 2008.

MAY & BAKER NIGERIA PLC: Audited result for the year ended 31st December 2007. The Directors are recommending a dividend of N0.40 per share. The date of closure of register of members is September 4, 2008 while payment date would be advised later.

ASSOCIATED BUS CO. PLC: Audited result for the year ended 31st December 2007 shows Turnover of N3.13 billion as against N2.71 billion in 2006. Profit after tax stood at N141.25 million compared with N143.01 million in 2006. The Directors are recommending a dividend of N0.08 per share. The date of closure of register of members is August 7, 2008 while payment date is September 3, 2008.

ASSOCIATED BUS CO. PLC: Unaudited result for the first quarter ended 31st March 2008 shows Turnover of N830.3 million, as against N716.3 million in the comparable period of 2007. Profit after tax stood at N62.9 million compared with N50.2 million in 2007.

CONSOLIDATED HALLMARK INSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N1.51 billion as against N508.4 million in 2006. Profit after tax and deferred tax stood at N230.01 million compared with N56.9 million in 2006.

RED STAR EXPRESS PLC: Audited result for the year ended 31st March 2008 shows Turnover of N3.1 billion as against N2.7 billion in 2007. Profit after tax stood at N195.7 million compared with N118.5 million in 2007. The Directors earlier recommended a dividend of N0.25 per share. The date of closure of register of members is July 24, 2008 while payment date is July 29, 2008.

EKOCORP PLC: Audited result for the year ended 31st December 2007 shows Turnover of N532.75 million as against N457.7 million in 2006. Profit after tax stood at N72.2 million compared with N65.61 million in 2006. The Directors are recommending a dividend of N0.15 per share. The date of closure of register of members is August 25, 2008 while payment date is September 8, 2008.
STOKVIS NIGERIA PLC: Audited result for the year ended 31st December 2007 shows Turnover of N2.31 million as against N1.22 million in 2006. Loss before tax stood at N0.714 million compared with N4.3 million in 2006.

NAMPAK NIGERIA PLC: Audited result for the year ended 30th September 2007. The date of closure of register of members is July 21, 2008

CHEVRON OIL NIGERIA PLC: Unaudited result for the first quarter ended 31st March 2008 shows Turnover of N8.6 billion, as against N18.34 billion in the comparable period of 2007. Loss after tax stood at N190.63 million compared with profit after tax of N531.24 million in 2007. The company’s result was affected by the strike action embarked upon by the Transport union that lasted for about two months. The company is back into full operations and efforts are being made to recover lost volume.

REPORT ON THE OTC MARKET FOR FGN BONDS
A turnover of 206.9 million units worth N210.65 billion in 1505 deals was recorded this week, in contrast to a total of 280.3 million units valued at N281.2 billion exchanged in 2120 deals during the week ended July 3, 2008. The most active bond (measured by turnover volume) was the 3rd FGN Bond 2009 Series 11 with a traded volume of 38.7 million units valued at N42.73 billion in 387 deals.

Source: Nigerian Stock Exchange

A Timely Intervention

2008-07-08T18:46:00.000+01:00

The Securities and Exchange Commission and Nigeria Stock Exchange take swift actions to halt continued downward slide in the value of stocks in the market

June was a frantic month for the regulators of the Nigerian stock market. During the month the Securities and Exchange Commission, SEC, and the Nigeria Stock Exchange, NSE, struggled to halt the slide that was speedily eroding the market’s capitalisation. The stock market lost N1.215 trillion when the market’s capitalisation crumbled from N11.631 trillion to N10.416 trillion between June 2 and June 25. The slide was precipitated by an unconfirmed report that the Central Bank of Nigeria, CBN, had banned banks from engaging in margin trading. The apex bank later denied issuing such a directive.

The first step taken by SEC and NSE was to empanel a committee that would review the practice of margin trading, known also as financier account in the capital market. A financier account enables investors and stockbrokers to borrow money from financial institutions for the sole purpose of buying shares in the stock market at a predetermined interest rate.

Members of the committee were selected from SEC, CBN, NSE and the Nigerian Deposit Insurance Corporation, NDIC. On June 9, the NSE followed this up with the introduction of the circuit breaker, an artificial support system that does not allow stocks to trade below their previous day’s closing price.

The NSE also directed that a stock must trade up to 100,000 units before its price could either move up or down. It also went further to lift the ban it placed on the financier account, on June 11, and renamed it as custody account. Sola Oni, NSE’s spokesperson, said, “that the lifting of the suspension was with immediate effect. Under this system, the purchased stock acts as collateral and cannot be sold without the knowledge of the lending institution. This arrangement empowers the investors and sustain demand in the market.

Ndi Okereke-Onyiuke, NSE’s director-general, explained that it was expedient for the market regulators to intervene and restore confidence to the market. Said she: “There is no stock market in the world where the managers will sit down and watch the market crash. If we see something going wrong in the market, we must intervene.”

In a bid to sustain investors’ confidence, SEC announced its plan to further cut down the cost of doing business in the capital market. Earlier in April, the apex capital market regulator succeeded in bringing down transaction cost in the market by 40 percent. Lanre Oloyi, corporate affairs manager of SEC, explained that the move was intended to attract foreign and local investors into the market. “Already, there is an in-house committee working on this and as soon as it concludes its business, the outcome would be made available to the federal government for approval before its implementation,” he said.

The above measures appeared to have restored investors’ confidence as the market capitalisation soared from N10.950 trillion on June 6 to N11.721 trillion on June 13. But the revival was only momentary as the market plunged into another wave of decline with share prices dropping on daily basis between June 16, and June 25, from N 11.416 trillion to N10.416 trillion.

As the share prices crumbled, the question of concerned observers was why the market’s downward curve was so steep in June. Onyenwechukwu P. Ezeagu, chief executive of Solid-Rock Securities and Investment Limited, Lagos, told Newswatch that there are three major determinants of share price movement in the stock market. They are a company’s performance, the interplay of the forces of demand and supply as well as market’s hearsay. All these factors, he explained, contributed to last month’s bearish mode of the market.

“The market was reacting to the pronouncements of market’s regulators, particularly the rumour on margin trading, which stampeded stock brokers into selling off stocks in order to meet obligations to their bankers,” he said.

The stampede, he explained, disrupted the market equilibrium as supply rose above demand to precipitate the fall in share prices. Ezeagu also attributed the drop in prices of shares at the market to government’s delay in releasing the capital budget and the distraction caused by SEC’s directive that stock brokers should increase their capitalisation from N75 million to N1 billion or loose their operational license.

David Obi, a member of the governing council of the Manufacturers’ Association of Nigeria, MAN, told Newswatch that the downward trading in the Nigerian capital market mirrors the economic recession afflicting the global market. He said that even as low as the Nigerian market may appear at the moment, it was still performing better than most other countries’ capital markets.

“The slow down in the stock market was even good for us, so that we can ponder on the way we invest. Also, an ever-rising market is not always possible. It is normal for the market to pulsate sometimes,” Obi said. He, however, noted that the important thing is for the country to be serious in the manner it manages its economic activities because in the final analysis “it is the investors’ confidence in the economy that drives the capital market.”

Bismarck Rewane, head of Financial Derivatives, has warned regulators to be more careful with their pronouncements because of the sensitive nature of the market. He said that their actions were capable of increasing the anxieties of investors, “and when investors are anxious, they do only one thing: stop bringing money in and might start to take money out.”

Rewene was right. The withdrawal of the directive for brokers to increase their capital base on June 26, coupled with the lifting of the ban on financer account, has seen the market bouncing back and becoming more bullish. Consequently, the market capitalisation has grew from N10.416 trillon on June 25 to N10.920 trillion on June 30.

Nigerian companies set to woo UK investors

2008-07-08T04:02:00.000+01:00

Some 20 Nigerian companies cutting across all sectors of the economy will be in London from 8-9 July to woo international investors as a way of attracting international funding to support their businesses, according to the Nigerian Stock Exchange (NSE) and Renaissance Capital, an international investment bank which is packaging the business trip.

The interactive session, which will provide first time opportunity to non-financial services sector companies from oil, gas, manufacturing, fast moving consumer goods, telecommunication and real estate, will hold at Mandarin Oriental Hotel, London.

“The recent boom in the Nigeria financial services sector has led to increased capacity to support the development of other sectors,” said the Chief Executive Officer of Renaissance Nigeria, Andrew Cornthwaite.

He said many of the companies were seeking ways of attracting the necessary funding to expand their businesses, hence the need to reach out to foreign investors.

“We are delighted to be able to offer them (companies) the first opportunity to meet with prospective international investors,” he added.

Nigerian Stock Exchange can’t collapse — Swiss-based Nigerian economist

2008-07-08T00:26:00.000+01:00

FEW days ago, a Nigerian owned Swiss-based firm, AME &T Group, organised a four-day seminar on Private Wealth Management (PWM) for top executives of banks and other professionals in the country. The resource persons were experts drawn from leading management institutes in Switzerland.
In exclusive interviews with Financial Vanguard, the President of AME & T (the Nigerian that organised the seminar) and three of the resource persons spoke on the seminar and various other economic issues. Could you give us a brief resume of AME & T Group that just organised the seminar on private wealth management in Nigeria?

It is basically an enterprise development management, an investment advisory firm. We do a lot of risk management in wealth management as well as sustainable enterprise development practice.

We have done a lot of jobs managing clients, both institutional and private, as well as government, especially governments from Africa in area of maximizing their wealth with Europe, especially Switzerland, whereby they could tap into Switzerland’s private banking practice as well as investment banking practice viz a viz the growing trend in African countries to tap into strong countries in terms of project management like currently, the Federal Government of Nigeria is trying to raise bonds.

They are doing that by approaching international financial institutions, not only on the investment banking, but also on private banking. There is need for that exchange of knowledge and expertise. We have advised a lot of multinationals as well. So, basically, that is our core practice.

AME &T Group is structured into three key products and services. One is Enterprise Development and Management. We have advisory services and then the training arm. These three components actually dictate the way we operate and our core practice. Then there are some services under our advisory.

For instance, we have Investment Advisory section that deals with energy industry. We advise quite a lot of multinationals on raising finance may be from private equity clients of our investment outlet. It could be loan or whatever has to do with their investment banking-related issue. That is in the oil and gas sector. We also handle telecom investment advisory.

Basically, what we do is work with institutions that are willing to maximise profitability. We also provide some finances in terms of arranging loans as well as helping them to structure their finances in a way whereby they could tap into foreign funds. Thirdly, on the training aspect, which is part of the advisory also, is where we bring our expertise to bear in an environment like Nigeria that is evolving. So, that is the way we are structured as a Swiss firm.

We are a decade old. We are more than that in actual sense, in that AME & T Group came as a result of an acquisition of a Swiss company which is about 50 years old. We re-structured it and repositioned it to meet the needs of our immediate clients in the investment banking-related field. Our passion for wealth management came as a result of our expertise in that field. We try to impart that expertise and knowledge to our clients and various institutions - be it a non-governmental organisation (NGO) or individuals - depending on what they want. So, that is the way we are structured.

The training we conducted in Nigeria was the first of its kind. We had a similar event in Geneva, private banking training, which we did in 2004. We had some institutions that attended that. But this was a bit tailor-made for the Nigerian audience.

That of Geneva was more of an international event. We had coordinated and organised series of teachings and lectures for top executives from Africa. An example was the one we had with the Swiss Stock Exchange in Zurich about three years ago.

So, we are well known in the Swiss environment to provide qualitative training as well as in-house training for clients especially those from emerging or transiting economies like Nigeria. So, one of the reasons we decided to do it here in Nigeria is because of the post-consolidation of the banks knowing full well that a lot of banks are diversifying into private banking. A lot of them need the expertise.

We managed to have one-on-one discussions with some of the top chief executive officers (CEOs) of these banks. From our researches and findings, we realised that a whole lot of them do not have solid background on private banking practice.

It was as a result of this research that we decided that we should provide this training capacity to these top level executives from these institutions. This, to us, is a welcome development and from the response that we have received so far, we believe that there is definitely going to be a lot of follow up on this subject.

Agreed that Nigeria is a transiting or emerging economy, there was a recent prediction by the United States intelligence agency that the Nigerian economy would collapse in 20 years time. What do you think about that report?

Well, that is more of a political statement than economic statement. Political because it basically came from the CIA’s intelligence report on Nigeria. Economic indices state that definitely, Nigeria has a growing pattern and that pattern will continue to grow as long as the nation remains the same. That is, if it does not disintegrate, we will continue to have the economy. From the economic point of view, there is no basis for that. They have to match that prediction up or such analysis and forecast with current trend in the economy.

There is another prediction and anxiety that the Nigerian Stock Exchange will soon collapse. Did you hear about that and what do you think about it?

Yes, we heard that and we are following it. But I have to tell you that the Nigerian Stock Exchange will not collapse. It will correct itself. The collapse of an exchange in a way is impossible especially in a regulated economy and also in a liberal economy, in that you have an all-share-index. Basically, you do not expect a nation’s stock exchange to collapse.

It means all the companies will collapse. That is what they are saying in essence, which is impossible. Right, there will be bubble and there will be effect of such bubble. But that does not mean that a nation’s stock market will collapse as a result of that bubble. There will be some fundamental adjustments and changes.

You do not expect that the market has to be perfect all the time. I tell you, there is no perfect market or perfect economy. Even the New York Stock Exchange, London Stock Exchange, definitely they experienced this kind of bubble. There is always this kind of upward and downward trend in any market economy. It is correcting itself because, the Nigerian economy was only just of recent opened up and also, it is just of recent that you are witnessing that kind of inflow of funds from investors.

Definitely, that would affect your trading pattern. It will affect the market itself. The stock market in every way, is regulated. For instance, three years ago, we were here and met with stock exchange leadership led by the Deputy Director-General, we realised some of these abnormal trends.

Even the trading volume at that period was extremely low and what we were even clamouring for was a higher trading volume to attract foreign investors and make the exchange more liquid. Now with post-consolidation of the banks, you have seen that a lot of those banks have brought in a lot of liquid cash into the stock which has made the stock exchange a little more vibrant, more dynamic and more attractive. That is why you see a lot of people coming in.

That is what is affecting the market now. There is too much influx of funds and this is giving it that level of vibrancy that was not the pattern years back. It is shaky.

That is why we call it bubble. Right now, there is a redefinition of the whole market. Someone like me who never believed in the market, now I have a lot of funds invested in various Nigerian stocks. The consolidation of banks, other financial institutions, that itself has created a lot of transformation in both the financial services sector as well as the stock market.

You as a Nigerian, you have a company in Switzerland. Nigerian government is clamouring for Nigerians in the diaspora to come home and invest in the economy. When are you going to do that?

We are doing our best to come back. Like I met with President Yar’Adua, during his visit to Davos. We made a presentation, our firm was among what they called Zurich 9. I had my foreign associates with me. We really talked with the president about a whole lot of investments in Nigeria rather than chasing contracts. Our approach is really to try to drive volume of funds and investments to Nigeria. So, we set up, that is our other practice, a First African fund which we are going to launch very soon and this was part of the presentation that we made to Mr. President.

The fund will invest in both listed equities as well as conduct private equity bills. We are looking at bringing quite a lot of investments into the Nigerian investment arena. That is my own part of driving volume and helping the economy to grow. But to come physically, I think Nigeria still needs me there to help bring the money. When I am here, you will not have that access anymore.
What is discouraging you from coming back to Nigeria?

Nothing whatsoever except that it is just an issue of mindset and what I consider to be my comfort zone. I am comfortable there. At the moment, I do not have any comfort zone here.

If for example, there is stable electricity, will you come?
You are bringing a whole lot of political issues that I would not want to talk about. Well, that is part of infrastructural development.

That is actually an aspect we will be willing to participate in and we will like to advise the government. I will say to you as an African firm based in Switzerland, for 40 years the Nigerian government never owned a property in Switzerland. We advised the government and a new Chancery in Switzerland was acquired through us for the government of Nigeria. The Swiss Government is indeed very grateful about this.

So, we have been advising the government. This is one of the things we have been doing to improve the nation’s image there. So, the first Chancery of the Nigerian Government, owned by the Federal Government, was bought last year, moved in last year by the Nigerian Government. They now own a property and they are no longer in a rented property.

They had been in Switzerland for 40 years without owning a property and wasted money for 40 years in Geneva which sits almost 70 per cent of all United Nations agencies. It was a disgrace at a point. So, we had to come in to bail out. So, it is one of our success stories.—Vanguard

NSE approves 25% absorption of Costain WA 2007 offer oversub

2008-07-07T07:25:00.000+01:00

The Nigerian Stock Exchange (NSE) has approved the absorption of the 25 percent allowed by regulatory authorities on oversubscription of Public Offers (POs) by Construction Giants Costain West Africa Plc (COSTAIN).

Phil Wharton, Managing Director/Chief Executive Officer (MD/CEO) of the company affirmed this in Lagos Nigeria at the NSE; while addressing members of the Capital Market Correspondence Association of Nigeria (CAMCAN).

“We have just received the final words from the NSE towards taking over the 25 percent maximum allowed in the event of oversubscription in Public Offer” Wharton said.

He confirmed that Costain’s 2007 hybrid offer by way of subscription and Rights Issue were 240 percent and 140 percent oversubscribed respectively.

Wharton further confirmed that the shares were listed on the Floors of the NSE a few weeks back.

On the issue of share certificates, he affirmed that Costain has dispatched same to investors; taking into consideration the complaints as regards the issue.

“We are very concerned on the bad publicity as regards the issue of dispatch of share certificates to investors. Therefore our advisers had informed us that all share certificates had gone to shareholders, anyone who is yet to receive should get back to us” Wharton said.

Also on the issue of return money, He confirmed that this has been returned to investors with interest.

Though as at the time of filling in this report, he could not confirm the exact amount in figures returned to investors. “I do not really have the information now, but in due time we would furnish you with same” Wharton affirmed.

He further confirmed that Costain West Africa delivered a return of over 250 percent in a six month period with its 2007 Public Offer (PO).

“Costain have delivered a return of over 250 percent in a six month period with our offer at N13.00 in December and a share price of almost N30.00 today” Wharton said.

As earlier reported, Costain West Africa, late 2007 by way of subscription and Rights offered to the Nigerian investing public 178,162,966 and 519,740,000 Ordinary Shares of 50 Kobo each at N13.00 and N11.00 per share respectively

CBN denies halting margin lending

2008-07-07T07:20:00.000+01:00

The Central Bank of Nigeria on Friday publicly declared that it neither issued nor contemplated to stop commercial banks from their practice of margin lending or lending for investment in securities

The CBN Governor, Prof. Chukwuma Soludo, stated this at a Breakfast Forum for the Bankers’ Committee and financial system regulators in Lagos. On the price volatility witnessed on the Nigerian Stock Exchange in recent weeks, Soludo said market volatility was a major feature and common phenomenon in the global market system. He said this was not peculiar to the NSE alone.

He said, “We are still surprised ourselves to hear the rumours making the rounds that we stopped margin lending by banks. There was no letter issued or discussion in this regard. It was not even contemplated by the CBN. We did not know where it came from, but certainly not from us. We make bold to categorically state that there was no basis for it. The CBN will not and does not prescribe to the banks on which sector they should lend to and which sector they should not. The banks are free to lend at whatever direction their management wishes them to.”

Also speaking at the session, the Minister of State for Finance, Mr. Remi Babalola, expressed faith and optimism in the economy, saying the position of the capital market at the moment was one that should attract more foreign direct investment. He said, “We expect that contrary to speculations, this is the right time for investment both domestically and internationally. Foreign direct investments should quadruple yearly and this is what we expect. The market is still in the right direction.”

On the controversies surrounding the operation of custody accounts and margin accounts by stockbrokers, the Director-General, Nigerian Stock Exchange, Prof. Ndidi Okereke-Onyiuke, said the NSE did not stop custody account operations as perceived by market watchers. She said the Central Securities and Clearing System simply issued a letter to the authorities to the effect that the margin accounts be maintained, adding that the controversy was because people were more used to the facility. She said the nomenclature was simply changed from custody accounts to margin accounts.

FCMB launches Alpha fund for investors

2008-07-07T07:16:00.000+01:00

AS part of measures to assist investors minimise the volatility of their investments and manage their risks, First City Monument Bank Plc (FCMB) in partnership with International Consortium, has introduced a $100 million multi strategy hedge fund, called legacy African Alpha fund into Nigerian financial markets.

The hedge fund, which is the first of its kind involving a Nigerian institution is being introduced at a period when investors in the Nigerian Capital Market are experiencing volatility in their investments.

Addressing journalists in Lagos, yesterday, the Executive Director, Investment Banking, FCMB Group, Mr. Gboyega Balogun said that the legacy Africa Alpha Fund is a $100 million multi strategy hedge fund focusing primarily on Africa’s high growth opportunities with limited exposure to the middle East and Asia.

According to him, the hedge fund seeks opportunities to reduce risk through hedging strategies by shorting a stock or asset class with a target return of 22 per cent per year in dollar terms on any equity with less than 10 per cent risk or volatility.

The fund, which will be invested exclusively in Africa and Middle East debt and equity will be structured as an absolute return fund. Specifically, a minimum of 70 per cent of the fund will be invested in Africa while a maximum of 30 per cent will be invested in the middle East.

He also noted that International Consortium, which currently manages investments worth over two billion dollars for bluechip financial institutions such as American Express will be providing the funds, which FCMB will sense as advisers in successfully deploying the strategies.

On the strategies involved, Mr. Balogun said that the organisation will observe a top down macro strategy in channelling investments in the country till it reaches the fundamentals.

He said: “We will begin by looking at macro economic story in each country within its universe to decide allocation to these countries after which we look at sectors benefiting or from macro story in favoured countries before filtering down to fundamental analysis on chosen asset class.”

He also added that the fund is only available for institutional and professional investors with limit of $100,000 minimum investment in equities, fixed income and currency.

On its future outlook, Balogun said that the organisation is building a legacy family of funds with long-term security by introducing four more products into the market so as to increase its assets to $500 million in the next 12 months and one billion dollars in the next 18 months respectively.

“Currently, we have two funds launched; Legacy Nigeria Equity Fund managed by CSL and Legacy African Alpha Fund managed by INTIL consortium. We have four more to come in the next 12 months. The franchising model allows us to grow very fast while retaining high quality, top performing managers and consistent governance. We expect to get to over N120 billion assets under management within 24 months, making us; possibly the largest asset manager in the region,” he added.

On its human capital development drive, he said that FCMB and International Consortium are engaging in exchange programmes to ensure that the fund is managed independently by FCMB.—Guardian

Equity Assurance plc records 722 percent profit.

2008-07-04T02:44:00.000+01:00

Equity Assurance plc has recorded a profit after tax of N445 million in its 2007 financial year. These was made known by the chairman of the company, Mr Olufemi Somolu during the company’s 21st annual general meeting held in Lagos on Monday. The profit after tax rose compared to the N54.1 million it recorded in 2006 shows an increase of 722 percent. Profit before tax for the company was also impressive as it stood at N498.7 million compared to N55.8 million in the 2006 financial year, indicating an appreciation of 793 percent.
Turnover during the period under review grew by 572 percent from N225.6 million in 2006 to N1.5 billion in 2007. While attributing the impressive outcome of the result to the merger that occurred in the company during the last consolidation exercise in the insurance company, he announced that the company was going to give a dividend payout of 35 kobo per share.

Nigerian Stock Exchange for July 1st, 2008.

2008-07-02T03:06:00.000+01:00

The Nigerian Stock Exchange continued on its recovery path today as the Market price indicator, the All Share Index again edged up again to 55,949.00 base points as against yesterday’s 54,905.36 base points. The total market shares valuator, the Market Capitalisation also went up to N10,920,315,601,242.56 as against yesterday’s N10,716,615,132,199.71.

There was a total of 10,459 deals involving a volume of 573,179,540 unit shares valued at N9,381,974,978.27; as against yesterday’s 13,658 deals involving the trading of 1,236,774,565 unit shares volume, valued at N12,739,794,993.53.
The stocks with the most traded unit shares in a descending order includes: (1) PLATINUM which traded with a volume of 95,846,363 unit shares, valued at N2,828,708,971.90; (2) FIDELITYBK traded with 58,123,359 unit shares valued at N589,790,903.50; (3) IANSURE traded with a volume of 50,285,588 unit shares worth N52,297,011.52; (4) FIRSTBANK traded with a volume of 26,988,405 unit shares worth N1,154,294,081.85; (5) NIGERINS traded with a volume of 20,092,026 unit shares valued at N136,640,966.80.
The top price gainers of the day includes: (1) MOBIL which gained N9.84 to close at N206.71; (2) JBERGER gained N5.73 to close at N120.33; (3) ACCESSRDB3 gained N4.00 to close at N104.00; (4) WAPCO gained N2.55 to close at N54.15
While the top losers of the day includes: (1) CHEVRON lost N16.92 to close at N321.67; (2) TOTAL lost N12.00 to close at N238.00; (3) OANDO lost N8.74 to close at N195.25; (4) 7UP lost N2.46 to close at N52.00

Law Union drives NSE volume

2008-07-01T19:59:00.000+01:00

Law Union and Rock Insurance Plc drove the market volume on the floor of the Nigerian Stock Exchange last Friday by recording a transaction volume of 252.815 million shares valued at N1.206 billion in only 23 transactions inching by 3 kobo to close at N4.93 per share.

Aso Savings and Loans Plc emerged the second volume driver having pulled a transaction volume of 154.034 million shares worth N574.918 million executed in 89 deals dropping 19 kobo to close lower at N3.61 per share.

Investment and Allied Assurance Plc occupied the third position with 126.388 million shares exchanged by investors in 432 deals at N137.763 million easing 5 kobo to close at N1.09 per share.

Goldlink Insurance Plc followed from a distance with 78.407 million shares equivalent to N164.006 million exchanging hands in 81 trades while Platimum Habib Bank Plc trailed with 67.691 million shares valued at N1.895 billion in 698 deals adding 5 kobo to close at N28.50 per share.

Other volume drivers in the market last Friday include Fidelity Bank Plc 46.161 million shares, Sterling Bank Plc 37.767 million shares, First Inland Bank Plc 35.013 million shares, Intercontinental Bank Plc 32.951 million shares and United Bank for Africa Plc 29.610 million shares.

In all, investors staked N12.740 billion on 1.237 billion shares in 13,658 deals as against 983.537 million shares worth N17.294 billion in 17,112 trades recorded the previous day.

Analysis of the two days’ record showed that though the transaction rose when compared to the previous day’s, the market value, and number of deals which measures investors’ interest in shares dropped, an indication that investors are still treading cautiously.—The Tide

Chinese fund manager pays $2m for lunch with Buffett

2008-06-30T11:37:00.000+01:00

Omaha, Nebraska - A Chinese investment fund manager has won the chance to have lunch with US billionaire Warren Buffett, by bidding $2.1 million (R16 million) in the most expensive charity auction held on eBay.

Zhao Danyang of the Hong Kong-based Pureheart China Growth Investment Fund won the auction, which ended on Friday. The auction will provide a significant boost to the Glide Foundation, which receives all the proceeds from event.

The foundation provides social services to the poor and homeless in San Francisco. Denise Lamott, the spokesperson for Glide, said it operated on a $12 million annual budget.

“It almost feels like a miracle,” said the Glide Foundation’s founder, Cecil Williams. “We are amazed and ready to continue our work of breaking the cycles of poverty.”

Last year’s lunch brought in $650 100. Zhao and up to seven friends will dine with Buffett at the Smith & Wollensky steakhouse in New York.

The investment philosophy Zhao’s fund describes on its website is similar to Buffett’s approach of finding companies with an enduring competitive advantage.

Buffett, the chairman and chief executive of Berkshire Hathaway, is primarily known for his investing success. Berkshire owns more than 60 subsidiaries, including insurance, clothing, furniture, jewellery and candy companies, restaurants, natural gas and corporate jet firms.

He has major investments in leading companies such as Coca-Cola, Anheuser-Busch and Wells Fargo.

But Buffett is also known for his philanthropy. In 2006, he announced his plan to give away the bulk of his fortune of nearly $49 billion over time.

Most of his Berkshire stock will go to five charitable foundations, with the largest going to the Bill & Melinda Gates Foundation.

Lamott said eBay officials had confirmed that this year’s lunch with Buffett was the most expensive charity item the site had sold.

Buffett has been auctioning off lunches online for six years, but began auctioning the lunches for Glide off line in 2000. He offers only one lunch a year.

Williams called Buffett’s dedication to the charity lunches amazing. “Thank you, Warren Buffett, for your deep compassion and sensitivity that empower us to transform the lives of so many people in need.” - Busrep

Cost income ratio of Nigerian banks too high—Yomi Adeola

2008-06-30T11:34:00.001+01:00

•Spend too much money buying all sorts of things that are not needed

Recently, Yomi Adeola, Managing Director Sterling Bank PLC had an interactive session with journalists in his office in Lagos and spoke on a wide range of issues in the banking industry in Nigeria.
Excerpts

Is Sterling Bank coming to raise more funds from the capital market, how much are you targeting and when should we expect this to happen?

We are looking at the September/October timing for going to the market. On the issue of how much capital we need, I am not a believer in too much capital, I imagine we would go for between N50 and N75 billion in capital for the kind of bank we want to run, I do not need N250 billion in capital, I do not need N300 billion in capital. Experience has also shown that those people who have raised huge capital have been unable to deliver the return on the capital. I will not mention names but we know banks that have raised N300 billion in capital and all they made today in profit before tax is N30 billion, that’s 10 per cent return, it’s not good, it’s not exciting. So why beat the drum and deceive the whole public to come and invest and at the end of the day, the return on equity is nothing to write home about? I know another one with about N180-200 billion capital, same thing.

If Sterling Bank at N25 billion capital is able to deliver between 30 and 40 per cent return, that’s better for investors than the one that is raising N300 billion and delivering 10 per cent. So you see, there’s this bandwagon effect in Nigeria and I think it’s madness, so if Bank A has raised N200 billion, I must go for N250 billion, Bank B has raised N50 billion, let me go for N300 billion; they are not looking at ratios anymore. This is capital in absolute terms or just air capital, capital is just in the air, it’s not working for you. Of what use is that kind of capital? So, by the time I am raising N50 to N75 billion, I should be able to predict the kind of return I can give on that capital and it will not be far away from the kind of return I am giving on the capital that I have today so that doing 20-25 per cent profit on my N25 billion, by the time I get to N100 billion, let it not be less than the same 20-25 per cent, otherwise I’m not being fair to my investors and I won’t be fair to the people I have taken money from. That’s my attitude to the issue of capital; it won’t be too high, raise what you truly need and also when you have too much capital, the tendency is for you to see waste. Look at the cost income ratio of Nigerian banks today, it’s just too high - they spend too much money buying all sorts of things that are not needed, I won’t name them, you know some of the things they buy. I don’t think I want to run that kind of bank.
Going to the market can’t just be for fun, what would you do with this capital you intend to raise?

First and foremost, we would like to get our technology right or should I say, improve on our technology; that is key. We want to do consumer banking big time. We really want to reach out to the consumers, the masses, the middle income earners. The way to do consumer banking is to deploy technology appropriately so we would be spending a lot on technology. Number two is to expand our branch network. Today, we have 100 branches, the level of sophistication in Nigeria is such that you still need brick and mortar, you still need to put branches all over. You don’t need to build branches that are too elaborate but you must have the branches so we would build the branches.

Don’t forget we have a major shareholder and this happens to be the largest bank in India-, the State Bank of India (SBI), we would partner with them, identify other locations outside Nigeria where we believe between Asia and Nigeria, we would be able to derive some synergy in partnering with SBI and having pockets of locations outside Nigeria so this is also a game plan and above all, our single obligor limit will go up because this is usually the percentage of your shareholders’ fund so these are the key areas we would be focusing on. We have about six subsidiaries that are profitable, doing good business; we would capitalise some of these subsidiaries that can do more. We have the Sterling Asset Management, they need more capital and we’ll give them more capital. We have Sterling Capital, we have a few subsidiaries that require more capital. We would also set up some additional subsidiaries for specialisation and we would also use part of this new capital for some of these initiatives.

With the mutual agreement between Sterling and ECOBANK to discontinue the merger, a lot of investors particularly people that bought your shares as well as your shareholders, would be worried that there were no indications in terms of the direction the bank is headed. Could you throw more light on this?

If a merger does not work or does not go through, it’s not because management does not want it, it’s because shareholders don’t believe they are getting value. At a time a merger is called off, shareholders don’t believe they are getting value. And that is what happened in this case. For the shareholders - what was on the table was not giving them enough value and they called it off, not management. Now, when you are calling off a merger, it means you are looking at the opportunity cost of moving on as Sterling than pursuing a merger. There must be something positive they see in Sterling moving on for them to have called the merger off. And for me, that thing is very clear, they see a bank with great potential; they see a bank that is beginning to put legacy issues behind and is beginning to do well.

They see the numbers, at least the quarterly numbers improving and they are telling themselves, ‘why should we go and play second fiddle? Why should we be bought cheap when the bank is doing well?’ So in terms of direction, there’s no other pointer to a positive direction than the numbers. Immediately the merger was called off, we published our half year results, much better than the half year result of the prior year. Management believes the third quarter result will further confirm and corroborate this. And by the time we get to the year end, we’ll be posting the kind of return on equity that would be among the top three in the banking industry. What other direction could be better than that?

What typically happens in most Nigerian banks is that people make so much noise and that has permeated the system that if you are not a noise-maker, it now appears as if you don’t know what you are doing. Whereas in many economies, it is not noise-making that determines success, it is numbers, it is customer satisfaction, it is employee satisfaction, it is shareholders’ satisfaction and I don’t have a doubt that we are on course in all these three areas.

In what particular area of business do you think Sterling Bank has an edge given the fact that former NAL Bank, of the five legacy institutions used to be an authority in investment banking?

Several things are happening in Sterling Bank at any given time, let’s start with capital market. You know we set out to focus on three areas in addition to several other areas: capital market activities, consumer finance and trade finance, these are the three primary areas. We have several other areas that we would talk about. Let me start with capital market activities. Several peer reviews have been done in the market and it’s been established that Sterling Capital is one of the three leading investment banking outfits in Nigeria today. In the past fifteen months, we’ve taken more than 23 companies to the market including at least six banks out of the 17 banks that have gone to the capital market to raise capital and this hasn’t stopped. We have in the pipeline, another five or six companies we are about to take to the market. So this is one area we set out to be a leading player and we’ve established beyond doubt that we are a leading player as far as capital market activities are concerned in Nigeria.

If I go into the area of consumer finance, we are making waves quietly. We are very dominant in the acquisition and sale of most of the flats in 1004 (Housing Estate). Today, there are many projects on the Lekki-Epe axis and we are giving mortgages to deserving Nigerians thereby changing the face of this economy, allowing the middle class to evolve once more. From mortgage finance, to asset base finance, cars, refrigerator name it. We did a promo on laptops that was a huge success. We are doing one now on generators and you would not believe the number of customers we have acquired through this generator promo. On a daily basis, they troop in because they are interested in financing. You see, developed economies survive on credits and we must introduce that here and that is what we are doing.

We are very active in consumer finance, we are going to do much more but I can tell you we are happy with what we are doing. You mentioned the issue of embassy collection, it’s not just one embassy, we collect for several embassies but in the nature of the contract that we signed, this is not a business we want to make too much noise about. But all the embassies that we collect for are happy with the bank. Now, collection transcends the private sector, we also do a lot of collections for government, including Power Holding Company of Nigeria (PHCN), FIRS, Lagos Water Corporation and many more.

The AutoReg in Lagos and other states are asking us to come and replicate what we did in Lagos for them and right now, we are in about three or four states. We are doing collections. We are very active in this area and if we are to move to the third area of focus, which is trade finance - trade is the main stay of the Nigerian economy; if you look across the water, you’ll see all the goods coming in- these goods are being financed by banks. We’ve financed a lot of imports for our customers and we set out to do this, we are doing it, we are getting more and more lines from international banks on a daily basis. We started with just about two banks- State Bank of India (SBI), they are our partners and the largest shareholders in the bank and I believe CitiBank.

Today, we have trade finance lines from about seven international banks to finance imports, so we are doing very well in this area too. We have moved away from just import finance. We are beginning to carve a niche for ourselves in the area of maritime business. The number of vessels we have financed in this bank in the last 15 months cannot be less than 25. We actually opened a maritime centre in Apapa where everybody who is interested in maritime business from vessel financing, to crude boats, and we have built the expertise in this area. If you are talking about oil and gas, there is a local content support fund. A few banks have been put together to do this and we are very happy to do this in this area. So for us, business is good and we keep on seeing more and more business opportunities in Nigeria as the economy is opening up, as the GDP is growing by the day, we are seeing opportunities.

By the time we add more capital, it can only get better but I must concede we haven’t made enough noise by Nigerian standards. And I think it’s a function of two things: one, banking ordinarily is supposed to be a conservative business. It’s not a business that you do by noise-making but here if you don’t make the noise; people believe you are not doing anything. So, we may not have a choice but to make some noise, but we would make whatever noise we are making within the professional ambit so that we would not go overboard as long as noise-making is concerned. The best selling point for any company is the number.

Just put the numbers on the table and every other thing would fall in place. In terms of products, we are dishing them out everyday; in terms of acceptability by the market, by the regulation, by the competition, we are getting fully on board. In treasury, they have a peer review that they do among themselves (all the treasuries of banks in Nigeria) and they did one recently. They would rate themselves and come up with the results and Sterling came out 4th of the 24 treasuries in Nigerian banks but these are not things you put in newspapers, so the treasurers of banks know themselves; they know where the good people are.

Are you challenged by the increasing need for training and more qualified personnel in the banking industry?

Banks come here first whenever they want to raid, whenever they are looking for good people, they say go to Sterling. We’ve been able to stem the tide because our people and staff are beginning to see a very good future and they are saying why should we go? There’s hope here we would stay. If anything, we are beginning to see the reverse; more and more people from the so-called big banks wanting to come to Sterling and we’ll hire some of them, we would because we also need to inject some fresh blood into the system and this would happen within the next few months. We would hire people from some other institutions. For now, we are happy with our size and like I told you in the beginning of this interview, banking is not about size, banking is about efficiency, banking is about return on investment, banking is about employee satisfaction, customer satisfaction, shareholders’ satisfaction, which is the ultimate.

Once you have satisfied employees, they would go all out to satisfy their customers. If your customers are satisfied, they would go all out to do the bulk of their business with you and this would translate into revenue and once the revenue is there, shareholders would be satisfied. When you satisfy the shareholders, what else would you be asking for? So we would not at this stage play the size game, we don’t believe that is priority. Priority today is to play the efficiency game, it’s to play the ration game, it’s to play the return game and we are playing that in a very calculating manner.

What is the message to your numerous shareholders who have endured till this moment and what would be the keyword to them at your AGM coming in about a fortnight?

Let me start by saying that it’s been proven in the world of business that you stabilise mergers in three years, it’s usually between three to five years to have relative stability. We’ve done two and a half and we are happy to tell our shareholders that they have a stable bank. They have a bank whose capital is unimpaired by losses anymore. Once your capital is unimpaired, it means whatever profit you make you can declare a dividend. We’ve made enough profit by half year to be able to wipe off the goodwill on our books because we carry a goodwill of about N3 billion but we’ve made enough profit in half year to wipe it off. So all that is left is for the board or their board to decide on the amount on dividend they want to pay and it would be paid. There’s no reason whatsoever, why Sterling Bank would not be able to pay dividend by end of year three, which is December this year, absolutely no reason and once the dividend starts rolling in, it can’t stop, it would become a regular feature of the institution. And that is the message for shareholders. They have a stable bank, they have a stable management, they have a stable board, they have a bank whose profitability is increasing quarter by quarter and things can only get better for them. They have sacrificed enough and I believe that the returns on investment will start coming from the end of this year.

Given the fact that about 70 per cent of Nigerian households now spend more than 50 per cent of their income on food and given the high food prices and inflation, how do you operate in this kind of environment and how has this impacted on your business?

The cost of doing business in Nigeria is huge and I must tell you that it is very tough, you must be able to provide your own security, if you are in the banking industry, not only security for your branches, but as you move your cash from location to location, you must have heard what is happening in the East today, the bullion vans are being shot down using all sorts of gadgets and grenade to blow up bullion vans. You must generate your own electricity. You have ATMs and they operate on electricity so you can’t even say when you close you would shut down because customers want to use your ATM, so you generate your electricity, you know how much you pay for diesel these days.

Infrastructure remains the major problem in Nigeria and if you are talking about the cost of doing business, it is usually the cost of infrastructure. Any business for that matter would immediately transfer these costs to the consumer. So when people talk about interest rates in Nigeria, service charges, they can actually go down if the cost of doing business goes down but I don’t know when the cost of business would go down in Nigeria. So what we try to do here is to manage cost to the best of our ability. There are some that you can’t do anything about but the ones we can manage, we manage them and we also try as much as possible electronically, telephone and what have you, instead of wasting useful man-hour in traffic; diesel, there isn’t much we can do, security, there isn’t much we can do.

So when you look at top line of many banks in Nigeria, earnings are huge but by the time you look at the expense line, it’s so huge. But that is the point we are making that it affects the bottom-line and all you can do is to build efficiency into the system in every area where you can be more efficient. We have introduced electronic statements so our customers get their statements online. That reduces the cost of postage, paper and so on. We also have the SMS notification, whenever anybody does anything to your account; you are immediately advised by SMS whether it’s a debit or a credit, you’ll get that. We also have a situation where customers can access their accounts online, access their balances, do internal transfers, of course these would help in reducing the cost of telephone and making enquiries. But I think the government has a lot to do as far as infrastructure development is concerned in Nigeria and if they play their role, it’ll probably reduce the cost of doing business in Nigeria.

What is your assessment of the economy in the past one year, especially under the new administration, has anything changed at all?

Well, the economy has been doing very well at the macro level. GDP is on the increase, the amount in reserve is huge, the CBN has been able to play its role well in the area of fiscal policies; the price of crude has helped a lot even without anything. What is left is strategic direction. Strategic direction is the function of the government. Only a stable mind can give strategic direction; when you have presidency or gubernatorial elections with cases all over the place at the tribunals, when is the Supreme Court going to rule on this, there can’t be stability in terms of direction.

But I think we are getting to that tail end when we would be able to say okay, no more litigations so the president is there for four years, what next? I think the president needs to independently appoint competent people to his cabinet. A political cabinet will not augur well for any country. I think the president has the discipline, the focus, the education and what it takes to take serious decisions but I think his cabinet is questionable and this is a function of how the cabinet emanated, it’s a political cabinet. You could live with that for a year, maybe maximun18 months, then you start taking decisions that it’s enough of this political game. Let’s move this nation forward because history will not forgive me with all the resources at my disposal, with all the strong economic fundamentals. If you don’t have the right people to manage the economy as well as to take charge of governance, then we’ll be drifting. I think we’ve drifted a bit but I also believe they’ve done a few good things: they’ve reversed some of the questionable policies of the previous administration but you don’t keep on reversing for ever, you must apply the grace.

How about the performance of the banking industry?

The banking industry in terms of hype, we’ve seen a lot. In terms of real contribution, we’ve also seen a lot. People are able to work with Nigerian banks now and get mortgage facilities and buy houses…three years ago, middle income earners would not dream of owning their own houses because the Nigerian banking industry has been able to build capacity and they have capital. Also, some of the loans given out to oil and gas industry, the telecoms industry three, four years ago - those loans would be coming from international banks abroad. You have a situation where three, four banks today would syndicate multi-billion dollar transactions without going out. And foreign banks that didn’t want to look at Nigeria, foreign banks that would not come near the shores of this country four years ago, are now looking for banking license. Look at the growth in the stock market, look at the growth in the telecoms market, look at the oil and gas market, look at the price of crude:

Nigeria is an economy to be reckoned with in Africa. Every telecoms company is now interested in license here. Every serious bank wants a piece of the action even as far as Russia - the Renaissance are here and they are interested in doing more. Banks are lobbying to influence the Central Bank to relax the rule on foreign ownership - it means something positive has happened and I think the Nigerian banking industry has contributed a lot to the growth of the Nigerian economy in the last two years. The bulk of the growth to the Nigerian economy in the past two years has not been from oil, it’s been from non-oil sector; it’s because of the funding and financing and the role of banks in Nigeria and it’s not about to stop as I hinted you earlier…banks are looking for opportunities and this is how economies grow all over the world.

Deposit Money Banks are showing interest in micro finance…is Sterling thinking along this line or maybe acquiring any of the existing micro finance institutions?

Let me put it differently: We used to have SMIES whereby every bank must put 10 per cent of its PBT in SMIES. Whether truly this worked or not, we leave it to the judgment of history for we no longer have SMIES for several reasons. I personally believe it didn’t work because the banks did not have the expertise to do this equity investment. Two, most of the owners of these small scale enterprises are so afraid thinking that the banks would come and hijack their projects, so it didn’t work. So we resolved at the Bankers’ Committee level that instead of doing SMIES, let us put 5 per cent of our PBT into micro finance by partnering with state governments who would also put some equity. So whether you like it or not, for as long as you are making money, you must play a role in micro finance. Now, some banks would go into this heavily, some would do it at moderate level; it’s all about your strategy. I believe that banks should focus on the top side of the economy and leave that side to others so you create more employment, you diverse ownership and you make it easy for others to function. If as a bank you want to play a top role, you also want to be the one doing micro finance, you want to be jack of all trades, at the end of the day, you may end up being master of none. But play your role, whatever the percentage of your profitability you have put in to help them grow but in terms of running it or owning it 100 per cent, I’m not sure we want to do that now. I think we should leave that to others, the more, the merrier, let more people be able to play a role in the economic development of Nigeria. That is my view on that.

What kind of management structure do you run in Sterling Bank?

We are professionals first and foremost and professionals go by ideas and it’s the superior idea more often than not that is taken. We have three executive directors and a managing director. We have an executive management team of four; we meet on a monthly basis as executive management but we also have several other meetings like the ALCO, where treasury decisions are taken, like MPR, where profitability issues are discussed, Management Credit Committee (MCC), where credits are approved, we listen to ourselves as colleagues with experience in various places, with expertise in various areas, with diverse background, international favour; we have a representative of the SBI as part of the executive management - they bring best practices from other parts of the world, we bring best practices from here; we deliberate, we discuss but we yield to superior arguments, superior ideas, something that is in the best interest of the organisation.

What would you want to be remembered for at Sterling Bank?

Very simple! Someone who inherited a mountain of problems and within the shortest possible time, was able to level all these problems, turn challenges into opportunities, create an enabling environment for employees, somebody who was able to build an institution that has become the attraction of all stakeholders in the industry - employees, shareholders, regulators, staff and customers. I want to build an institution that everybody will be proud of and then I’ll have paid my dues. I’m passionate about doing that, it’s not easy but we are determined to do it.—Vanguard

Stability returns to stock market

2008-06-30T11:29:00.000+01:00

There are indications that stability is returning to the stock market after a protracted domination of bears in the past few weeks as more stocks experienced price appreciation.

Although, analysts are of the view that the market remained weak in momentum, the market outlook at the end of last week portends the gradual return of stability as evidenced by the increase in the basis points of All Share Index as well as the continual reduction in the number of losers.

Reasons for the return of the bulls have also been mixed because of the coincidence in market recovery with the suspension of recapitalisation of capital market operators by the Securities and Exchange Commission (SEC).

Indeed, the bulls had staged a comeback on Thursday, a day after the decision by the SEC to suspend the recapitalisation exercise, prompting some market watchers to affirm that majority of the stockbrokers were actually overwhelmed by the need to source the N1 billion hitherto stipulated as minimum capital base for stockbrokers before December 31, 2008.

It was gathered that SEC’s reluctance to shift ground and the withdrawal of margin loans by the banks took a toll on the position of some stock broking firms who had to sell shares in their portfolios in order to meet the deadline.

One of the operators volunteered that, “stockbrokers do not have other assets apart from the shares they buy into their box, they contributed to the market downturn when they began to sell off these shares in order to meet the N1 billion capital base, but now that the decision has been suspended, things are beginning to look up because there is hope that they would remain in business”

At the close of trading on Friday, the Nigerian Stock Exchange (NSE) all share index increased by 205 basis points to close at 53,910.37 and market capitalisation inched up N234 billion from the previous day’s N10.482 trillion to N10.716 trillion.

Although, there is also an increase in the number of stocks closing flat, analysts noted that “it is too early to predict when the market will bottom out or reverse.”

The downward trend of the market had persisted in the past three months with the market capitalisation dropping further to N10.416 trillion and all share index of 53,366.53 points on Wednesday, June 25. On Thursday, June 26, 2008, the market was sort of re-jigged by new developments. Therefore, capitalisation moved to N10.4 trillion and all share index of 53,705.30 basis points.

This also had tremendous impact on the number of gainers on the price movement table as at Thursday, June 26 when 40 listed stocks made it to the gainer’s chart as against the 23 that gained on June 24. The tempo continued on Friday, June 27 with 66 listed stocks comprising mostly the blue chips appearing on the gainer’s table.

Akamobi ECM, managing director, Star Insurance Brokers Limited, said that the recapitalisation in the stock-broking firms forced the traders to chase every kobo that comes their way with the intention of adding to their funds for capitalisation.

He said that most of the stockbrokers have started buying stocks on the exchange resulting in the increase in the volume of transaction on daily basis.

For the first time in the week, banking sector stocks lifted the activities in the market, as Intercontinental Bank plc traded over 193 million units (representing over 30 percent of volume traded in the banking sector); though a huge proportion of the total volume traded was cross deals. Similarly, Investment and Allied Insurance plc (IAA) lifted the activities in the insurance sector, as it traded over 103 million units representing over 40 percent of volume traded in the insurance sector for the day.

C&I Leasing plc Friday released its audited full year result for the period ended January 31, 2008. Gross Earning grew by 64.78 percent to N2.658 billion, from N1.613 billion; PBT grew by 165.7 percent to N437.645 million, from N164.737 million, Profit Ater Tax also grew by 9.79 percent to N375.363 million, from N341.887 million, in the corresponding period of 2007. The company also proposed final dividend of six kobo. This result did not have positive impact on investors as the stock closed strongly on offer of over five million units.

Index was up by 64 basis points on 17,112 trades. Average size of trade was $8,664.67 with total value of $148.27 million. Market capitalisation closed at $89.87 billion.

Overall, there were 40 gainers and 58 losers and 55 unchanged. The banking sector led the volume chart followed by the insurance sector and both accounted for 89.97 percent of total volume traded.

Intercontinental Bank plc traded 193.70 million shares to top the overall volume chart. Other stocks that closed in the top echelon were Bank PHB, Investment and Allied Insurance, FCMB and Fidelity Bank plc.- BusineesDay.

MARKET UPDATE FOR JUNE 26TH, 2008.

2008-06-27T03:05:00.000+01:00

The market price indicator only edged up for the first time this week to close at 53,705.30 base points as against yesterdays 53,365.53 base points, indicating a gradual recovery of the market. The Market Capitalisation also went up a bit to N10,482,381,849,556.62 better than yesterday’s N10,416,065,547,467.16 also marking a recovery. There was a total of 17,112 deals involving a share volume of 983,536,948 unit shares valued at N17,294,192,905.58 as against yesterdays 15,973 deals involving a volume of 1,274,507,737 units valued at N16,107,193,177.78.

The market movers in terms of share volume in a descending order includes: (1) INTERCONT which traded a volume of 193,704,201 units valued at N6,217,730,939.52; (2) PLATINUM traded with 120,948,336 unit shares, valued at N3,325,305,901.95; (3) IANSURE traded with 103,889,273 unit shares, valued at N118,433,771.22; (4) FCMB traded with 90,844,400 unit shares, valued at N1,496,545,930.49; (5) FIDELITYBK traded a volume of 40,145,764 unit shares, valued at N404,304,911.73.
The price gainers in a descending order includes: (1) 7UP gained N2.59 to close at N54.46; (2) ASHAKACEM gained N1.84 to close at N38.74; (3) ETI gained N1.71 to close at N40.00; (4) CADBURY gained N1.57 to close at N33.07. While the price losers list includes: (1) OANDO which lost N10.50 to close at N199.01; (2) CONOIL lost N5.20 to close at N99.80; (3) CAP lost N2.85 to close at N54.15; (4) NBC lost N2.44 to close at N49.01.

Shareholders laud Juli’s expansion plans

2008-06-26T23:17:00.000+01:00

PLANS by Juli Plc, a healthcare company quoted on the Nigerian Stock Exchange to expand its business into food processing and scan services was yesterday applauded by the company’s shareholders.

Speaking at the pre-yearly general meeting held in Lagos yesterday, the company’s Chairman, Prince Julius Adelusi-Adeluyi told shareholders that the company is adding two new lines to its business, which was commended by shareholders.

Besides, he told shareholders that two products, which would be branded Juli, have been designed and would be manufactured under contract manufacturing arrangements and manufacturers identified for each of the products.

He explained that samples of the cream is undergoing relevant laboratory test at NAFDAC and approval is expected within the month of July, adding that the names of the products have been cleared and registered with the Federal Ministry of Commerce and Industry.

His words: “There is good market for antibiotics and the tropical cream. The general populace irrespective of class/status or gender buys these products. The success would be based on strong marketing efforts, which we have continued to map out.

He continued: “We are also creating a medical supermart by adding to our lines of activities scan services. The relevant equipment has been purchased and the space to house it being made up. This should become operational in the month of July.

“We are also examining going into food processing and a decision would be based on a feasibility that would justify this. The facility at the head office would accommodate the nature if considered visible.

Commenting on the development, Mr. Anthony Omojola, a shareholder said the growth plans of the company is commendable considering the fact that the board has disappointed shareholders in the past by not giving them good returns on investment.

“Lately, the management has been trying to realign, re-arrange and reposition the company. The company is more focused now. We believe with these plans, they will be able to make profit and give returns to shareholders.

Another shareholder, Mr. Godwin Anonoh said the company has a strategic location, but there is need for the board to consider expansion into other strategic areas in Lagos to boost profitability.—Guardian

Dangote Cement signs $1.85bn expansion financing arrangements with banks

2008-06-26T23:08:00.002+01:00

Dangote Cement Plc, on Tuesday signed a $1. 85bn seven-years syndicated credit facility for the expansion project of its Obajana cement factory in Kogi state and another plant in Senegal.

At the well attended programme by gurus of industries from Nigeria and abroad, the company said the credit facility would be utilized for the acquisition of four new cement plants from Sinoma, a Chinese company. The finance for the project was raised by some local banks.over the years.

Speaking at the occasion, the company president and chief executive officer, Alhaji Aliko Dangote said the signing agreements with some local banks was significant for the company and the country, because by the time the company concluded the installations of its facilities, it would enhance the production of cement in excess in Nigeria and eventual reduction of its price.

According to the company, the new plants to be installed will compliment its existing Obajana and Benue facilities which are being upgraded. Also, it was said that apart from the plant to be installed in Obajana and Benue, two new ‘Greenfield plants’ will be built at Sagamu and Ibese all in Ogun State, while the fourth plant will be built close to Dakar in Senegal.

Obajana cement, according to Alhaji Dangote has two production lines with the capacity to produce five millions tons of cement per annum presently and with the proposed extension, the factory would expand its capacity to six million tons by 2009 and by 2010 would almost be doubled.

He added that with the additional capacity the company would provide the country with 26 million tons of manufactured cement and 2.5million tons in Senegal by 2010.

He said “Dangote Cement already operates Sub-Saharan Africa’s largest cement plant at Obajana and these new plants and lines will make us the largest producer on the continent. Africa is going through a construction boom as it seeks to address housing and infrastructure deficits that have been pervasive for too long. Dangote Cement is acting to address the shortfall in African production and provide the building blocks for Africa’s renaissance.

“For the new seven cement lines, we have raised US $1.28 bn from the local capital markets and the group has provided equity of about $600 million. Many of the financiers of the deal are here today, I thank them for their support.”

He said each of the new plant will be operational within next 28 months and this will make the country a self sufficient in cement production and also becomes a net exporter. Representatives of the banks that raised the finance at the occasion in Lagos commended the efforts of the company, especially its CEO, Alhaji Dangote for contributing its quota to the economic development of the nation.–Vanguard

Market downturn: Experts seek government intervention, laud NSE’s action

2008-06-26T03:38:00.000+01:00

Following the lifting of the regulatory measures to stem the free fall of prices of listed equities by the Nigerian Stock Exchange (NSE), the bearish trend that has been the order of the day in the capital market in the last couple of months returned last week, as the All-share index and market capitalisation both dropped by 9.65 per cent and 9.53 per cent respectively.

Evident in the decline was the fact that investors lost N1.12 trillion from their investments in the NSE, as the value of equities, represented by the market capitalisation dropped from N11.72 trillion at which it opened the week, to close the week at N10.6 trillion. The All-share index, another index for measuring performance of listed securities on the NSE, was not spared either, as it lost 5,809.21 basis points to close at 54,382.21 points from 60,191.83 points at which it opened the week.

To this end, experts in the Nigerian capital market have called for the intervention of the federal government in arresting the current downturn that has been witnessed in the market in the last couple of months.
Speaking in Lagos last week, the General Manager, Lambeth Trust and Investment Company Limited, Mr. David Adonri disclosed that the factors that are responsible for the continuous decline in the market indices and in the prices of shares can only be addressed by federal government, as the major factors are brought about by its activities.

He identified the monetary policies activities of the Central Bank of Nigeria (CBN), the delay in the implementation of the budget and the Niger-Delta crisis among other factors, as being responsible for the persistent decline in the prices of shares.

He said, “The CBN’s operation of the Monetary Policy Rate (MPR), which determines the interest rate to be charged by banks for lending and for deposit is a factor that determines the patronage of investors to the capital market. If the interest rate on deposits is high as a result of the MPR, investors will transfer their funds to the money market.

This has been the case in the past couple of months, as the interest rates have suddenly become attractive. Also, the delay in the implementation of the budget has created uncertainty in the mind of investors, especially institutional investors, who may have decided to withhold their funds from the capital market, while the Niger-Delta crisis, on its own part, have made foreign investors who had wanted to put their money in the country to desist from doing so, making them to take their other investments out of the country, some of which are in the capital market. All these have contributed in one way or the other to the decline that has recorded in the last couple of months.”

He called on the federal government to address the issues so as to restore confidence in the market and to improve the fortunes of the market, stemming the free fall. He also commended the NSE for its role in addressing the situation, stating that such actions are expected of the NSE in such critical situations that are capable of inhibiting the growth of the market.

However, the regulatory authorities have indicated their willingness to address the free fall of the prices of shares and prevent a collapse of the market. The CBN last week announced its determination to help in its own ways in addressing the decline in the market. It stated that it will not hesitate to churn out policies or introduce measures that will return the market on the path of growth and improved returns on investment.

Corroborating his views, Mr. Olufemi Awoyemi, Managing Director, Proshare Nigeria Limited disclosed that the action of the NSE in stemming the free fall in the prices of equities is in order with what is obtainable in other international capital market and does not amount to share price manipulation.

The NSE penultimate week, placed a ban on the downward movement of share prices, stating that any stockbroker who wants to trade a stock at a price lower than its current market price will have to present explanations to the NSE on why it wants to the stock to be sold at a lower price.

According to Awoyemi, “The NSE actions are in line with practices in stock exchanges worldwide. It is right for it to introduce measures that will prevent investors’ confidence from eroded and other factors that are likely to lead to the collapse of the capital market. For example, authorities in the New York Stock Exchange (NYSE) shut down the market for five days after the September 11, terrorists attack. This, according to the authorities was to avoid the collapse of the market which may have been caused by panic arising from the shock and uncertainties that followed.”

He noted that the action of the NSE cannot be called manipulation, but a process of putting check and balances to protect investors from losing their investment.

Meanwhile, Proshare has disclosed that its forthcoming investment and analyst seminar is designed to provide some clarity to burning issues in the capital market and provide investors with a roadmap to engage the market.

To this end, it stated that it has invited a renowned capital market analyst, Chukwuma Biosah, who is also the Chief Executive Officer of InvestIQ, to present its findings via a case study approach and demonstrate the validity of the approach and strategy used to play the market in these trying times.

The seminar which is scheduled to hold in Lagos and Port Harcourt, on June 26 and 21 respectively, is targeted at members of the analysts community and discerning investors who are committed to the capital market as a vehicle for wealth creation and other members of the public.

Meanwhile, Equity trading on the NSE in the week under review appreciated by 41.62 per cent as a turnover of 5.24 billion shares valued at 42.5 billion was recorded in 82,791 deals, in contrast to penultimate week’s turnover of 3.7 billion shares valued at N53.21 billion in 75,133 deals.

Analysis of trading in the week under review shows that on Monday, June 16, 2008, Dangote Sugar Refinery Plc recorded the highest share price gain, rising by N1.31 to close at N27.69 per share from N26.38 per share at which it opened, it recorded a turnover of 9.0 million shares valued at N246.67 million, its Earnings Per Share (EPS) stood at N0.14 while its Price Earnings (PE) ratio stood at 197.79, Costain (West Africa) Plc followed with a gain of N1.29 to close at N27.28 per share, it exchanged 4.31 million shares valued at N117.67 million, it notched a PE of 25.50 and an EPS of N1.07, Nigerian Aviation Handling Company Plc garnered N1.19 to close at N25.09 per share, it exchanged 180,961 shares valued at N4.4 million, it posted a PE ratio of 35.84 and an EPS of N0.70.

BankPHB Plc recorded a PE ratio of 23.40, an EPS of N1.19, a turnover of 63.07 million shares valued at N1.71 billion, a gain of N0.66 to close at N27.85 per share, Berger Paints gained N0.63 to close at N13.41 per share, it posted a turnover of 118,849 shares valued at N1.6 million, an EPS of N0.44 and a PE ratio of 30.48.

On Tuesday, Mobil Oil Nigeria Plc recorded the highest share price gain, rising by N9.37 to close at N196.87, investors traded 115,143 of its shares valued at N22.10 million, its EPS stood at N8.39 while its PE ratio stood at 35.04, Guinness Nigeria Plc followed with a gain of N1.80 to close at N130.00 per share, it recorded a turnover of 178,774 shares valued at N23.63 million, its EPS stood at N7.73 and its PE ratio stood at 16.82, Eterna Oil and Gas Plc garnered N1.66 to close at N34.92 per share, it exchanged 954,851 shares valued at N30.56 million.

Presco Plc notched an EPS of N0.33, a PE ratio of 89.06, a turnover of 2.87 million shares valued at N82.20, a share price gain of N1.39 to close at N29.39 per share, Dangote Flour Mills Plc gained N1.36 to close atN29.05 per share, it traded 1.87 million shares valued at N52.57 million, its EPS stood at N0.14 while its PE ratio stood at 207.50.

On Wednesday, June 18, 2007, Oando Plc recorded the highest share price gain, rising by N8.60 to close at N210.00 per share from N201.40 per share at which it opened, it exchanged 334,899 shares valued at N69.16 million, its EPS stood at N5.62 and its PE ratio stood at 37.37, Presco Plc followed with a gain of N1.11 to close at N30.50 per share, it traded 783,347 shares valued at N23.74 million, its posted an EPS of N0.33 and a PE ratio

STOCKS TO WATCH OUT FOR THIS WEEK

GTBank Plc, First City Monument Bank Plc, International Breweries Plc, Cement Company of Northern Nigeria Plc, Berger Paints, Red Star Express Plc, Omatek Ventures Plc, Transnational Corporation of Nigeria Plc, Unilever Nigeria Plc, Costain (West Africa) Plc, Big Treat Plc, National Salt Company Plc, Fidson Healthcare Plc, Japaul Oil and Maritime Services Plc, Union Homes Savings and Loans Plc, Deap Capital Management Trust Plc among others.

Companies Financial Results at a Glance

Four equity prices were adjusted for dividend as recommended by the Board of Directors. The price of Guinness Nigeria Plc was adjusted for Special Dividend of N6.80 per share. Intercontinental Bank Plc was adjusted for final dividend of N0.40 per share. Mutual Benefits Assurance Plc was adjusted for dividend of N0.06 per share. Equity Assurance Plc was adjusted for dividend of N0.035 per share

New Listing

The 2,941,789,472 shares in favour of Omatek Ventures Plc were admitted to the Daily Official List at a price of N4.90 per share on Wednesday, June 18, 2008 by way of Introduction. The shares were listed in the Computer and Office Equipment sub-sector. By this action, the number of listed companies and securities increased to 222 and 317,respectively.

COMPANY NEWS / LISTING

IKE JA HOTEL PLC; Audited result for the year ended 31 st December 2007 shows Turnover of N5.3 billion as against N4.64 billion in 2006. Profit after tax stood at N697.75 million compared with N525.94 million in 2006. The Directors are recommending a dividend of N0.10 per share. The date of closure of register of members is June 23,2008 while payment date is July 28,2008.

CRUSADER INSURANCE (NIG) PLC; Audited result for the year ended 31st December 2007 shows Gross Premium of N2.2 billion as against N1.21 billion in 2006. Profit after tax stood at N1.45 billion compared with N267.12 million in 2006. The Directors are recommending a dividend of NO. 15 per share. The date of closure of register of members is June 30,2008 while payment date would advised later.

SMART PRODUCTS NIGERIA PLC: Audited result for the year ended 31 st December 2007 shows Turnover ofN 12.54 million as against N 10.6 million in 2006. Profit after tax stood atN3.9 million compared with N2.4 million in 2006. The Directors are recommending a dividend of N0.075 per share. The date of closure of register of members is June 25,2008 while payment date would be announced later.

DN MEYER PLC: Audited result for the year ended 31st December 2007 shows Turnover of N2.1 billion as against N2.01 billion in 2006. Profit after tax stood atN63.8 million compared withN60.75 million in 2006. The Directors are recommending a dividend of NO. 10 per share. The date of closure of register of members is June 30, 2008 while payment date would be announced later.

DN MEYER PLC: Unaudited result for the first quarter ended 31st March 2008 shows Turnover of N491.55 million, as against N483.22 million in the comparable period of 2007. Profit after tax stood at N13.2 million compared with N10.4 million in 2007.

SCOA NIGERIA PLC; Unaudited result for the half year ended 30th June 2007 shows Turnover of N1.32 billion, as against N 1.25 billion in the comparable period of 2006. Profit after tax and exceptional items stood at N777.24 million compared with N20.2 million in 2006.

NAMPAK NIGERIA PLC: Audited result for the year ended 30th September 2007 shows Turnover of N2.85 billion as against N2.7 billion in 2006. Loss after tax and exceptional items stood at N145.92 million compared with profit after tax of N129.52 million in 2006.

NAMPAK NIGERIA PLC; Unaudited result for the half year ended 31st March 2008 shows Turnover of N1.436 billion, as against N1.439 billion in the comparable period of 2007. Loss after tax stood at N183 million compared with profit after tax of N61.74 million in 2007.

NCR (NIG) PLC; Audited result for the year ended 31 st December 2007 shows Turnover of N4.21 billion as against N1.6 billion in 2006. Loss after tax stood at N31.82 million compared with N623.1 million in 2006.

INCAR (NIG) PLC; Unaudited result for the first quarter ended 31st March 2008 shows Turnover of N22.52 million, as against N26.5 million in the comparable period of 2007. Loss after tax stood at M2.2 million compared with N2.3 million in 2007.–Vanguard

Market indices continue on a free fall journey

2008-06-22T11:51:00.001+01:00

As against the trend experienced previous week, market indicators decline freely through this week by 9.65per cent as the NSE ASI index closed on the down side at 54,382.21 points. On the contrary, the total market capitalisation of the 222 listed equities slumped by 9.53per cent to stand at N10.60trn. The divergence in returns from index and capitalisation is attributable to the shares of Omatek Venture Plc admitted into the Daily Official List on June 18, 2008.

However, compared with previous week trading statistics, total volume of shares traded increased by 41per cent representing 5.24 billion shares exchanged by investors in 82,798 valued at N42.52bn.

Advances/Declines

CHEVRON (+14.62k), MOBILE (+9.37k) and 7UP (+2.60k) emerged leaders on the week’s gainers’ chart, while TOTAL (-N12.54k), GUINNESS (-N10.80k) and NESTLE (-N9.25k) led on the losers’ camp. It should be noted that GUINNESS was adjusted for final dividend of N6.80k on Friday June 20, 2008, which is responsible for the huge decline in its share price.

At close of activities, 14 stocks advanced in price lower than 92 recorded last week. 98 equities declined in value far higher than 2 noticed previous week while 12 closed flat.

Sectoral performance

For the fourth week running, Insurance sector sustained its dominance, emerging as the most active sector in the stock market by volume. The sector accounted for 3.43 per cent of total turnover of shares in 14,521 deals worth N6.45bn. Activity in the sector was driven trading in the shares of IAINSURE, UNIVINSURE and GOLDINSURE. Trading in the shares of the 3 companies captured 86per cent of the sector’s turnover. The banking sector trailed closely behind on the week’s activity chart with 1.3 billion shares exchanged in 38,977 deals valued at N28.99bn. Activities in the shares of companies in the Conglomerate sector claimed the third position on the table with 119 million shares traded in 2,225 deals.

CORPORATE NEWS: Corporate Results

CRUSADER INSURANCE PLC and NAMPAK NIGERIA PLC posted their audited accounts for the year ended December 31, 2007 and September 30, 2007 respectively. Similarly, SMART PLC and SCOA PLC both released their audited accounts for the year ended December 31, 2007 and un-audited Q2 results for the period ended June 30, 2007 respectively. Others in the group are:

- Ikeja Hotel Plc declared its audited accounts for the year ended December 31, 2007. The directors recommended cash dividend of N0.10k.

- DN Meyer Plc released its un-audited Q1 results for the period ended March 31, 2008 alongside with its audited accounts for the year ended December 31, 2007.

- INCAR (Nigeria) Plc posted its un-audited Q1 results for the period ended March 31, 2008.

- NCR (Nigeria) Plc made public its audited account for the year ended December 31, 2007 which shows turnover increase to N4.21bn from N1.6bn recorded previous year. Meanwhile, SMART PLC proposed a cash dividend of 7.5kobo per share with June 25 to July 08, 2008 as closure date. Payment date is to be announced later. Crusader Insurance Plc also declared a dividend of 15kobo per share. Closure date of register is between June 30 and July 04, 2008.

Longman Nigeria Plc goes on suspension

The share price of Longman Nigeria Plc froze on receipt of an official notice in respect of proposed placement of shares by the company.

New Listing by Introduction

- A total of 2,941,789,472 ordinary shares of 50kobo each were admitted into the Daily Official List of the NSE by introduction in the name of OMATEK VENTURES PLC at N4.18k.

- TANTALIZERS PLC: The NSE would be admitting 2,950,000,000 ordinary shares of 50k each at N3.50k by way of introduction on Monday June 23, 2008 in the name of Tantalizers Plc

Bear market: How to deal with capital losses

2008-06-22T11:46:00.000+01:00

The question of why stocks fluctuate has been a nagging one, especially for beginners in the art of investment. Falling stock prices are sometimes a hard pill to swallow. But experts have cautioned that long-term investors should not be concerned. A leading investment expert and the proprietor of About.com, a major investment network, Mr. Joshua Kenon, says the answer to this lies in the nature of the stock market, which is based on volatility. According to him, “The stock market is essentially a giant auction - only instead of antiques and heirlooms, it is ownership in businesses that’s up for grabs. Stocks are traded at places called exchanges. At these exchanges, traders buy and sell shares of companies. He says, generally, the price of a stock is determined by supply and demand. For example, if there are more people wanting to buy a stock than to sell it, the price will be driven up because those shares are rarer and people will pay a higher price for them. On the other hand, if there are a lot of shares for sale and no one is interested in buying them, the price will quickly fall.

On the trend in the market, he says, “Because of this, the market can appear to fluctuate widely. Even if there is nothing wrong with a company, a large shareholder who is trying to sell millions of shares at a time can drive the price of the stock down, simply because there are not enough people interested in buying the stock he is trying to sell. Because there is no real demand for the company he is selling, he is forced to accept a lower price.”

Knowing how the stock market works will help investors understand the individual factors that cause wild fluctuations in stock prices. This understanding will help investors to take advantage of the manic-depressive behaviour that sometimes seems to affect their portfolio, as it is being currently experienced on the Nigerian scene.

How a bear market affects your investments

Generally, a bear market will cause the securities you already own to drop in price. The decline in their value may be sudden, or it may be prolonged over the course of time, but the end result is the same: the quoted value of your holdings is lower. In this trend, two fundamental principles must be noted. One, that a bear market is only bad if you plan to sell your stock or need your money immediately. Two, falling stock prices and depressed markets are friends of long-term, value investors.

In other words, if you invest with the intent to hold your investments for decades, a bear market is a great opportunity to buy. It is always amazing that some “experts” advocate selling after the market has fallen. The time to sell was before your stocks lost value. If they know everything about your money, why didn’t they warn you the crash was coming in the first place?

What to do in a bear market

The biggest question that normally agitates the minds of investors in times of capital losses is: What do I do with my money in a bear market?

Kenon says the first thing you need to do is to look for companies and funds that are going to be fine ten or 20 years down the road. “If the market crashes tomorrow and causes Gillette’s stock price to fall by 30 per cent, people are still going to buy razors. The basics of the business haven’t changed. This brings us to the third principle of a bear market: ‘Learn to separate the stock price from the underlying business.’ They have very little to do with each other over the short-term. When an investor understands this, you will see falling stock markets like a clearance sale at your favorite furniture store; load up on it while you can, because history has shown that prices will eventually return to more reasonable levels.–Punch

Intercontinental Bank Plc post 125 percent profit.

2008-06-22T04:51:00.000+01:00

Smart Products Nigeria Plc, One of the second-Tier securities traded on the Nigerian Stock Exchange in the group categorised as ‘emerging market sector’ of the market, recently proposed a 7.50 Kobo dividend, with closure date of its register for this purpose scheduled for between 25th June to July 8th 2008. This information is contained in her fully audited result for the year ended December 31st 2007. The company, who’s major business is the processing of palm oil is likely going to progress into the Agro-allied sector of the market as a first-Tier security if it continues to grow in capital and further meets the stringent listing requirements.

Other features in the positive result includes: A Profit After Taxation of N3.865 million as against a year 2006 comparable periods figure of N2.359 million, indicating a 63.46 percent increase in distributable profit; a Profit Before Taxation of N4.759 million as against a year 2006 comparable periods N3.489 million; while the company also recorded a Turnover figure of N12.545 million as against a previous year comparable periods N10.555 million figure.

Another result that reached the market this week was that of Scoa Nigeria plc. Scoa submitted her unaudited second quarter result for the year ended 30th June 2007. The Profit After Tax was N777.245 million as against a previous year 2006 figure of N20.200 million, making a woping 3747 percent increase in distributable profit money, was recorded within the accounting period. The extra-ordinary increase was largely due to an Exceptional item which the company disclosed to be due to the disposal of an idle property. Other features in the result includes a Profit Before Tax of N827.245 million as against a previous comparable year’s figure of N20.200 million; also a Turnover figure of N1.321 billion was recorded as against a previous comparable periods N1.255 billion.

Nigeria Says Stock Market Swings Will Be Contained (Update1)

2008-06-21T03:56:00.000+01:00

The Central Bank of Nigeria said gains in stock prices over the past year were justified by corporate earnings and the outlook for economic growth and that the government is concerned by volatility in the market after shares tumbled in May.

The government and regulatory authorities will take “whatever steps are necessary to preserve the recent gains in the Nigerian Stock Exchange,” the central bank said in a statement on the Web site of the Abuja-based Nigerian presidency today. It didn’t give details on what they may do.

The Stock Exchange’s benchmark All-Share Index fell 11 percent between May 19 and June 6 on speculation that the central bank planned to act to halt margin trading, the practice of borrowing money to buy shares. The central bank denied it had any such plans, Lagos-based Thisday newspaper said on June 10.

Recent declines have pared the rally in the stock index over the past year to 10.5 percent from 34 percent on March 5

Stocks: Senate moves to regulate capital market

2008-06-20T07:50:00.000+01:00

The Senate on Wednesday threw its weight behind moves to regulate the practice of share registration in Nigeria.

This followed its decision to refer a bill titled; “A Bill for an Act to establish the Chartered Institute of Capital Market Registrars to regulate and control the practice of share registration and for related matters, 2008,” to its committee on Capital Markets for further legislative action.

Chief sponsor of the bill, Senator Ganiyu Solomon, in his lead debate said “The role of registrars in capital market and indeed the economy is crucial.

“It is, therefore, the thinking of the committee that records of investors and their investments must be handled by qualified and tested professionals so as to ensure adequate protection, transparency, guard against fraud and enhance the standard of service delivery in the market in line with international best practices.”

According to him, the registrar is expected to be a manager of resources, an accountant, a computer specialist, stockbroker and industrial relations expert.

This, he said, meant that the practice of share registration was demanding and needed specialised skills and tools that cut across so many other professions.

Senator Abubakar Sodangi said, “It is important in the sense that in a developing economy like ours, and even in the developed economies of the western world, our capital market is the harbinger of economic growth and I believe we need this thing. Apart from that, I believe this is a good bill.”

He, however, complained about problems associated with the distribution of share certificates and receipt of dividends for shares bought by investors.

Senator Mohammed Mohammed said, “This regulation is welcomed. When companies started being quoted on the stock exchange there were very few registrars at that time and the registrars were the banks, which started to take up the jobs of registrars.”—Punch

Ex-EADS executive charged with insider trading

2008-06-20T07:25:00.000+01:00

Former European Aeronautic, Defence & Space Company, Chief Operating Officer, Jean-Paul Gut, was charged with insider trading for selling shares before disclosing production delays on Airbus SAS’s A380 superjumbo airliner.

Gut, 46, was arraigned on a preliminary count of insider trading by investigating judges and released on bail of 400,000 euros, said Isabelle Montagne, a spokeswoman for Paris prosecutors. Gut is the second former EADS executive charged in the case, according to the Bloomberg News on Wednesday.

Paris prosecutors investigating whether company executives and stockholders Lagardere SCA and Daimler AG sold EADS shares based on internal information about production problems for the A380, the world’s largest passenger plane, Former EADS co-Chief Executive Officer, Noel Forgeard, was charged last month after being held for 35 hours.--Punch

Rapid growth, major challenge for capital market –SEC

2008-06-19T18:36:00.001+01:00

The rapid growth being witnessed in the Nigerian capital market was a major challenge that regulators of the market are grappling with, the Director-General, Securities and Exchange Commission, Alhaji Musa Al-Faki, has said.

A statement obtained by our correspondent on Wednesday, said the SEC boss made the observation at the inauguration of the commission’s board on Tuesday.

The significant growth recorded by the capital market, analysts said, had overwhelmed both operators and regulators of the market.

This, they alleged, had resulted in deficiencies in the system.

According to Al-faki, the capacity of the capital market to provide the funding needs for investors, as demonstrated by the various public offers that had taken place in the market, strengthens their argument.

He added, “Its international profile as a good destination for foreign investments and a credible platform for global players has been on the increase.

“The commission in this regard is pursuing, as a matter of urgency, the implementation of policies that will enhance market efficiency, transparency as well as the capacity of operators and regulators.

“Ultimately, the target is to sufficiently mobilise funds for infrastructure and financing in the economy.”

The director-general assured that the new board would expedite the process of addressing these challenges.

He reiterated that there were plans underway to further reduce the cost of doing business in the capital market.

“This, among others, will encourage greater flow of both local and foreign investments. As in the previous exercise in 2007, all stakeholders will be carried along, as only an across board review will bring the desired positive impact,” he explained.—Punch

‘Cut in transaction costs’ll boost market activities’

2008-06-19T02:35:00.000+01:00

Operators in the Nigerian capital market have said that the move by the Securities and Exchange Commission to further reduce transaction costs in the capital market will enhance participation.

The Managing Director, Quantum Securities Limited, Mr. Oladele Odunsanya, said in an interview with our correspondent on Tuesday, that most investors had been discouraged by the high transactions costs.

He said reducing the costs might help correct the current bearish trend in the stock market.

Similarly, a stockbroker who pleaded anonymity, for fear of being sanctioned by the capital market regulator, said with an increase in the turnover of the capital market, the reduction in transaction costs would be appreciated.

He added, “For us as stockbrokers, our transaction charges should be increased. The multiple taxes we are saddled with eat deeply into our charges, which has been reduced.”

Major indicators on the NSE have been declining in recent times and this has made stakeholders apprehensive.

The capital market’s apex regulatory body had, last Thursday, disclosed plans to further reduce transactions costs.

According to the spokesman of SEC, Mr. Lanre Oloyi, a committee has been set up by the commission to initiate modalities for the exercise, following which the details will be released to the Federal Government and market operators.

Oloyi said, “The purpose is basically to attract more local and foreign investors into the market. There is a committee set up by the commission on this, and as soon as it concludes it work, the recommendations will be forwarded to the Federal Government. We seek FG’s approval for its implementation.”

He said that since the capital market had been fingered as a pivot for the nation’s vision 2020, the commission was willing to work towards achieving that goal.

SEC had in April 2007, reduced transaction costs in the capital market by 40 per cent and hinged the reason for its action on the need to encourage investors.–Punch

Transactions Tumble Further

2008-06-19T02:31:00.000+01:00

Despite the efforts of the management of the Nigerian Stock Exchange (NSE) to ensure that activities in the capital market improves after some months of continuous bearish run, transactions in the market have remained down.

The market capitalisation of all listed equities which opened the day at N11.416 trillion lost N297 billion to close at N11.1190 trillion. Similarly, the all-share index closed lower at 57,101.72 points compared to 58,625.66 points it opened with.

Market operators explained that investors are not eager to rush back into the market, saying that they are still watching developments in the market. They further explained that so many investors incurred losses in the past two months due to the suspension on financier account, popularly known as margin account, as their banks were calling on them to clear their accounts which warranted offloading their holdings within the period.

They opined however, that the market will soon bounce back. Further breakdown showed that 67 stocks lost weight compared to 62 the pervious day with Oando Plc leading the whole lot with N10.609 to close at N201.40. BCC followed with price loss of N2.47 to close at N46.93.

Flourmill, Ashakacem and Zenith Bank followed losing N2.36, N2.22 and N2.20 to close at N87.49, N42.37 and N42.30 respectively.

Conversely, 19 companies added weight led by Mobil oil which gained N9.37 to close at N196.87, followed by Guinness with appreciation of N1.80 toclose at N130.00. Eterna oil, Presco and Danflour followed adding N1.66, N1.39 and N1.36 to close at N34.92, N29.39 and N29.05 in that order.

As in the pervious day, insurance sub-sector led activity on the sectoral chart, accounting for 724.2 million shares worth N1.5 billion done in 3,357 deals, followed by the banking sub-sector with traded volume of 142.112 million shares valued at N3.2 billion exchanged in 6,865 deals. It would be recalled that the NSE had last week in a spirited effort to restore confidence in investors and arrest the persistence tumbling of stocks, called off the suspension on financier account, thereby giving stock brokers leave to continue to take loans from banks to trade on behalf of their clients.

Besides, it has also taken some definite steps to ensure that arbitrary sale of private placements by some unquoted companies is brought to a stop; a situation the regulatory authority attributed the free fall in the market to, but the situation is yet to be abated

NSE vows to check abnormalities in private placement

2008-06-19T02:22:00.001+01:00

Following the upsurge in the number of private placement across the various sectors of the Nigerian economy and the attendant abnormalities trailing it, the Nigerian Stock Exchange (NSE) has vowed to expose promoters who negate the rules for the floatation of the foreign placement.
Speaking during a joint interactive session with stockbrokers and journalists on development in the capital market in Lagos, the Director-General of the NSE, Professor (Mrs.) Ndi-Okereke Onyiuke disclose the unconstitutional manner in which the private placement exercises have been carried out, saying “It has become alarming and calls for immediate action in order to protect investors from fraudulent and dubious promoters and to also protect the Nigerian capital market from collapse and lost of public confidence”, she said.

“The rate and number of private placement has become very alarming. These days every company irrespective of their status want to raise funds through private placement to the extent that the process is being abused and has recorded numerous abnormalities.

Today, private placements are being conducted like public offers. Many of the complaints we have been receiving from investors are about private placements. Many of the investors were misled to believe that the share of the company would be listed on the NSE immediately after the offer.

It is necessary we take certain step to stem the abuse and the abnormalities that have been recorded in the placement exercise.”

The measures introduced by the NSE to check the proliferation of private placement is it decision to ensure that companies does not list its shares by introduction unless, it presents before the NSE, its placement memorandum, barring such company from raising additional funds until one year after listing, insisting that the company brings to the trading floor five per cent of their total shares on issue, raising it to 10 per cent from September 2008, and listing the shares on the price at which the private placement was undertaken.”

Onyiuke disclosed that the normal process of private placement does not require that prospectus be printed but placement memorandum which are placed before not more than fifty investors identified by the company undertaking the private placement.

According to her, ““The Company and Allied Matter Act (CAMA) gave directions on how private placements are to be undertaken. These days, private placements are conducted like public offers. The law states that the document which carries information about the placement exercise be called a placement memorandum and should be laid before not more than 50 investors identified by the company, allowing for the company to overshoot this limit after it might have registered as a Public Limited Company (PLC).

These days, promoters of private placement print prospectus and distribute to everybody at every place. These is not supposed to be the case.”” She vows that the NSE will, henceforth, drag banks, stockbroking houses, issuing houses and other parties that goes contrary to the provisions of the constitution for the conduct of private placement, to the relevant regulatory authorities for sanctions to be meted out on them, warning that they stand the risk of getting jail terms. File name: NSE. June 16, 2008—Vanguard

FG expresses concern over situation at stock market - As market value drops by N297bn in one day

2008-06-19T02:13:00.000+01:00

AS share prices slide in the capital market, the Federal Government has stated that the negative global condition in the market may affect the Nigerian capital market.

Minister of Finance, Dr. Shamsuddeen Usman, stated this on Tuesday in Abuja while inaugurating the new board of the Securities and Exchange Commission (SEC).

Noting that the negative global situation in the capital market might spread to Nigeria, the minister said with good corporate governance, the global threat might not be a problem to the Nigerian market.

To ward off the threat, he said there was still a lot to do in the areas of entrenching market transparency, efficiency and discipline.

He said no effort should be spared towards ensuring the international competitiveness of the market and its relevance to domestic needs.

‘These can only be done through sustained commitment to zero tolerance for market abuse, improving processes and products and intensive public awareness campaign” the minister said.

With the calibre of people on the SEC board, Dr. Usman expressed confidence in the board’s capacity to provide the guidance required to move SEC in particular and the Nigerian capital market forward.

In his address, the Director General of SEC, Mr. Musa Al-Faki, said that efforts were ongoing to further reduce the cost of doing business in the Nigerian capital market.

He said this, among other measures would encourage greater inflow of both local and foreign investments. Members of the board are Senator Udoma Udo Udoma, Part-time chairman; Musa Al-Faki, Alhaji Lawal Sani Stores, Ms. Daisy Sabunju Ekineh, Mr. Charles Udora, Mrs. A.O. Fatade, Mallam Yahaya Alli, Mr Jubril Zarewa and Mr. Umar Bello Girei.

Meanwhile, despite the efforts of the management of the Nigerian Stock Exchange (NSE) to ensure that activities in the capital market improve after some months of continuous bearish run, transactions in the market have remained down.

The market capitalisation of all listed equities which opened on Tuesday at N11.416 trillion lost N297 billion to close at N11.119 trillion.

Similarly, the all-share index closed lower at 57,101.72 points compared to 58,625.66 points it opened with.

Market operators explained that investors were not eager to rush back into the market, saying that they were still watching developments.

They further explained that many investors incurred losses in the past two months due to the suspension on financier account, popularly known as margin account, as their banks were calling on them to clear their accounts which warranted their offloading their holdings within the period.

They opined, however, that the market would soon bounce back.
Further breakdown showed that 67 stocks lost weight compared to 62 the pervious day with Oando Plc leading the lot with N10.609 to close at N201.40. BCC followed with price loss of N2.47 to close at N46.93. Flour Mill, Ashakacem and Zenith Bank followed, losing N2.36, N2.22 and N2.20 to close at N87.49, N42.37 and N42.30 respectively.

Conversely, 19 companies added weight led by Mobil Oil which gained N9.37 to close at N196.87, followed by Guinness with appreciation of N1.80 to close at N130.00. Eterna oil, Presco and Dangote Flour followed, adding N1.66, N1.39 and N1.36 to close at N34.92, N29.39 and N29.05 in that order.

As in the pervious day, the insurance sub-sector led activity on the sectoral chart, accounting for 724.2 million shares worth N1.5 billion done in 3,357 deals, followed by the banking sub-sector with traded volume of 142.112 million shares valued at N3.2 billion exchanged in 6,865 deals.

The NSE had last week in a spirited effort to restore confidence in investors and arrest the tumbling of stocks, called off the suspension on financier account, thereby giving stockbrokers leave to continue to take loans from banks to trade on behalf of their clients.

Stock market will crash in the next 15 months - Analysts

2008-06-17T04:58:00.002+01:00

- Investors lost N1.5 trillion at stock market in 2 months

FOLLOWING the downward trend in the value of shares on the floor of the Nigerian Stock Exchange (NSE), the stock market may be heading for a big crash in a few months’ time, financial analysts have predicted.

The President of the Association of Professional Bodies of Nigeria (APBN), Mr. Bunmi Ajayi, told the Nigerian Tribune that there were danger signals in the economy, which, if not heeded, would spell doom to many.

He stated that Nigeria was ignoring the lessons of economic history and would not get away with it because what every nation needed to grow its economy was to first develop its agricultural sector and establish it well before going into industry.

Ajayi regretted that Nigeria was not doing either of these but rather it was into buying and selling, a situation that also led to the collapse of the stock sector of the United States of America sometime ago.

“We are doing a lot in developing this economy. This stock brokerage thing will crash. If we don’t learn from the crash of the American economy, we will never learn. Americans thought that they were wise. They were running from environmental pollution.

They sent all their factories to China to go and produce in China. They started playing round with money, with figures, with shareholdings and were not really producing. They were not manufacturing but spending money on money and figures on figures without solid structures,” he said.

The APBN president bemoaned the Nigerian situation, saying that the country had found itself in the same predicament without learning from the experiences of one time strong economies that suffered such a crash.

He observed that the banking industry that should serve as the service sector of the economy was not servicing the main sectors that would sustain the economy, which are agriculture and industry. “Now, where is the agriculture, where is the industry? So, what are they servicing and who are they servicing? They are servicing buying and selling. So, was the America and what happened to it?, it crashed,” he said.

A stockbroker, Mr. Kehinde Ajayi, said the value of most shares on the floor of the NSE was falling because the shares had been overpriced and were being placed where they actually belonged.

He also attributed the share glut to the rising level of inflation in the country, saying that “prices of goods are on the high side, people need money to cushion the effect. Those who could not get money from other sources but have shares have no choice but to dispose of some of their shares.”

In the same vein, Ambassador Olufemi Timothy, President, Shareholders Renaissance Association of Nigerian, said; “As far as we are concerned, the bearish trend in the market is not a good development. We are not being told what actually is happening by the Nigerian Stock Exchange (NSE).

“Another irony is that instead of allowing the forces of demand and supply to operate in the market as they relate to price movement, they are trying to guard against price fall which to investors is bad about the market.

“This singular action of the exchange in trying to prevent price fall is not good enough in the interest of the capital market development.

“Investors will be adversely affected, they may not know it now but later they will feel the negative impact. It is not good they are intervening without recourse to due process; it will affect foreign investment both in the short and long term,” he said.

But Mr. Boniface Okezie president Progressive Shareholders Association of Nigeria, believes there is nothing new about the present trend in the market.”

Okezie said: “What we are experiencing is that the fundamentals of companies quoted on the market are beginning to count. What have the fundamentals you may want to ask? If the fundamentals have being right then off course the prices will be on the up beat but if other wise then the reverse of what we are seeing will be the case.

“The situation in the market is however temporarily as the market would bounce back.” The capital market all over the world has always been said to be the barometer through which a country’s economic growth or otherwise is measured, more especially as it relates to the well being of it citizenry.

The market has always been an avenue where every economic unit which helps in the growth of the Gross Domestic Product (GDP) can easily be monitored on how best they have contributed alongside government policy measures.

Why this seems to be so, recent happenings in the market appear to be a fallout of the delay in the passage of the country’s budget, which market experts have argued is the major cause of depression currently being witnessed.

The lull in the market which has resulted in the bear taking hold of activities as at last Tuesday, June 10, caused a total loss of about N1.5 trillion by investors in the market.

However, the hold of the bear on the market has since caused capitalisation to dip by N1.17 trillion or 9.3 per cent in less than two months.

The capitalisation, which measures the value of all listed equities, fell from a historic value of over N12.6 trillion in the first week of March 2008 to close at N11.093 trillion on Tuesday, June 10.

Prior to the coming of the bears in the first week of March, the NSE capitalisation had appreciated by N2.42 trillion or 23.7 per cent from N10.18 trillion in January to N12.6 trillion.

After a successful 2007 with a growth of 74.5 per cent, the market continued on the positive trend and peaked with a growth of 23.7 per cent on March 5, 2008. About 53 per cent of the gains recorded by the NSE capitalisation have been wiped away by the rampaging bears.

Usually at this time of the year, investors have always believed that profit taking is the cause of depression in the market wherein investors seek to recoup returns on their investment via dividend payment from companies listed on the exchange.

However, events in the market shows that rather than profit taking, delay in the release of the budget and stoppage of the margin account as alleged against the Central Bank of Nigeria (CBN) are what are causing the market to decline on all indices.

Managing Director, Financial Derivatives, Mr. Bismarck Rewane, believes that the market is just undergoing correction since it has been grossly overvalued.

“What is happening is like a mini-correction. This should be expected because the market has been grossly overvalued and this is a big problem for people that have borrowed money to buy shares.

“The bears will continue till June. This is when we can expect to see recovery. The market will continue to look for the fair price and will then begin to climb naturally and slowly. But this does not in anyway depict that the market will crash,” he assured investors.

Managing Director, Economic Associates, Dr. Ayo Teriba, however, explained that investors might have switched from the capital market to the money market because of the rise in interest rate of the government securities.

An example of government securities are Treasury Bills (TBs), which are investment windows through which the Central Bank of Nigeria (CBN) controls the amount of liquidity in the system by selling bills to banks, discount houses and the investing public.

It is through this investment that the Federal Government borrows indirectly from banks, thereby mopping their excess funds.

With the income on TBs stable at about 10 per cent since last February and inflation at six per cent, Teriba said it make more sense to invest in TBs and earn a risk-free return of four per cent than to invest in capital market, which is uncertain.

While investors are still counting their losses the exchange this Monday came out with an attempt to stop the further decline by the market when it allegedly stop the printing of losers table for public consumption.

But this has been denied by the NSE through its principal manager on media matters, Mr. Sola Oni: “Every market has his own circle and during bearish trend, what people should find out is what are the likely causes of this bearish trend. Most of the companies that are under going bearish trend are blue chips, the fundamentals are right, the management have no problem, the company have been giving fantastic results, people have enjoyed bonus,” Oni said.

He noted that if the prices were now going down, it boiled down to the fact that people were realising more profit from the companies, adding that once the fundamentals were strong, that was a big signal “because from the way the market operates when bearish trend begins like this, it will get to a level that strategic investors, institutional investors and high net worth investors would cash in on the market and things will start improving” he added.

Nigerian Tribune gathered that the Nigerian Stock Exchange (NSE) had taken steps considered by market analysts as developmental intervention as the market in the past few weeks had moved southwards and some stocks reached new 52-weeks low.

Remarkably, some institutional and individual investors have shown a thorough understanding of the market, based in part on their deployment of shrewd analytical interpretation of market sentiments, technical analysis and fundamental.

Investment experts in this school of thought reason that all these could have been in combination of luck, access to information and fortunate timing, which are considered to be part of the analysis needed to engage the market.

Meanwhile, in the quest to help provide some clarity to these issues at stake and provide investors with a roadmap to engage the market, Proshare Nigeria Limited, the managers of Nigerians Online Investment Information Community has invited Chukwumah Biosah, Chief Executive Officer, InvestIQ to present his analysis.

According to Proshare, Biosah of InvestIQ (USA), its technical analyst partner would present his findings via a case study approach and demonstrate the validity of the approach and strategy used to play the market.—http://www.tribune.com.ng/17062008/news/news1.html

Market sentiments for the week ended 130608

2008-06-17T04:58:00.001+01:00

Investors heaved a deep sigh of relief as the authorities of The Nigerian Stock Exchange intervened to regulate the unending price free-fall in the market. Apparently bothered by the development that persisted for about 3 weeks, the regulatory authorities effected a market correction through what participants call ‘regulatory intervention’ by freezing prices of equities at their previous days’ close prices except for those that closed higher due to market forces of bid and offer (demand & supply). This intervention has helped to augment the market performance as The NSE ASI closed higher by 704 basis points to 60,191.83 points while total market capitalisation of 222 quoted equities rose by 7.04 percent to stand at N11.72trn against N10.95 trn reported in previous week. Some market commentators argue that the practice is not only peculiar to Nigeria but also obtainable in other developed economies as part of the statutory functions of the authorities of any Exchange.

There are indications that this regulatory intervention may last till when the issue of margin loans from banks to investors/stock brokerage firms is resolved amongst all regulators involved. However, market is rife with the news on suspension of the ban on margin trading accounts pending when the special committee set up comprising representatives of the Central Bank of Nigeria (CBN); Nigeria Deposit Insurance Corporation (NDIC), Securities & Exchange Commission (SEC), and The Nigerian Stock Exchange (NSE) meet to come up with a workable process. Market participants and regulators attribute the prolonged lull largely to the margin calls by banks following the directive from the Central Bank of Nigeria to put a halt to margin loans to capital market operators, an allegation that has been denied by the CBN authority at several fora.

Similarly, the recent publication by The NSE in respect of Private Placement has also spurred reactions from market commentators and participants. The authorities of The NSE have come up with a pronouncement putting a caveat on Private Placements which may somewhat make them unattractive to the investing Public. The NSE maintains that henceforth companies seeking listing on The Exchange by way of Introduction shall have such shares listed at the Private Placement price and will also meet the Listing Requirements, Rules and Regulations governing Initial Public Offerings (IPO) all in an attempt to protect investors’ interest.

We believe this pronouncement will bring some level of sanity to the market and substantially checkmate the flurry of Private Placements and its attendant effects on the secondary market activities.

Notwithstanding the regulatory issues that overshadowed the market during the week ended Friday June 13, 2008, a few stocks still made investors rich. Fidson closed the week at N9.55k to post 27.3 percent in capital appreciation Prestige Assurance also went on bid apparently due to its impressive full year results and lip smacking twin benefits of 20k dividend and 1 for 4 bonus.

No sooner had the authorities of The NSE made the pronouncement than the market re-adjusted with all performance indicators pointing northwards. We anticipate increase in activities in coming weeks following the suspension of ban on margin trading as investors re-position themselves in response to the latest developments. Also in response to these developments, market sources reveal that banks have started to approach their customers for margin facilities. This re-affirms our position of possible resurgence in coming weeks. - Meristem

Lehman posts $2.8-billion loss

2008-06-17T04:57:00.001+01:00

NEW YORK — Investment bank Lehman Brothers Holdings Inc. posted a quarterly loss of $2.8-billion (U.S.) on Monday, matching its forecast, after recording massive trading and hedging losses.

With the results coming in as expected, analysts focused on the potential for future write-downs at the fourth-largest U.S. investment bank, which still has more than $60-billion of mortgages, real estate assets and asset-backed securities on its books. That amount is well in excess of the company’s net worth as measured by shareholders’ equity.

Lehman last week said it expected a quarterly loss, its first as a public company, and said it was raising $6-billion of fresh capital.

That announcement triggered a crisis of confidence in the company’s management that brought Lehman shares down 20 per cent for the week and spurred the demotion of Chief Financial Officer Erin Callan and Chief Operating Officer Joseph Gregory.

Lehman Brothers Holdings

Lehman shares rose Monday morning, climbing as much as 68 cents, or 2.6 per cent, to $26.49 in early trading. The cost of protecting its bonds against default barely budged.

“The market was really focused on what Lehman would deliver. They were spot-on in the estimates and their numbers,” said Peter Kenny, managing director at Knight Equity Markets in Jersey City, New Jersey.

The market is carefully watching how Lehman is recording its hard-to-value assets, to see if more write-downs are coming, Mr. Kenny said.

Lehman said it took $3.7-billion of write-downs during the quarter for assets including mortgage securities. Banks and other financial institutions globally have written down more than $400-billion of assets amid the credit crunch.

Although those write-downs have triggered big quarterly losses at rivals like Merrill Lynch & Co Inc., Lehman had until this quarter managed to avoid posting a net loss. Short sellers including David Einhorn, who profit if Lehman’s shares decline, have said the investment bank has not taken the losses it ought to under accounting rules.

Lehman said its loss amounted to $5.14 a share for the fiscal second quarter ended May 31, compared with net income of $1.27-billion, or $2.21 a share, a year earlier. The loss was Lehman’s first since being spun off from American Express Co in 1994.

The company’s net revenue, affected by the write-downs, was negative $668 million, compared with revenue of $5.5-billion a year earlier.

Through Friday’s close, Lehman shares had fallen 60 per cent this year, compared with a 20 per cent decline for the U.S. brokerage sector as measured by the Amex Securities Broker Dealer index.

Lehman shares trade at less than 80 per cent of their book value, or the net per share accounting value of the company. Investment banks usually trade somewhere above their book value, and trading below that level signals that investors are bracing for more write-downs. - Globemail

‘18% of depositors’ funds used in margin trading’

2008-06-17T04:56:00.001+01:00

Shamsuddeen Usman, minister of finance, has raised the alarm that consolidated banks face new challenges as N2.5 trillion or 18 percent of depositors’ funds are currently being used for margin trading.

This makes the fund a significant factor that is driving prices in the Nigerian Stock Market. “Some analysts reports have estimated that 18 percent or about N2.5 trillion of depositors’ funds are used for margin trading,” Usman said.

The minister recalled that, earlier on, banking consolidation was aimed at strengthening the banking sector to play its developmental roles in the nation’s economy as well as make the Nigerian banking sector an active player in the African and global financial systems.

But with these initial objectives have come new challenges. Some of these challenges include more intense competition, sliding profitability/efficiency ratios due to share capital dilution ramifications, integration costs and the larger asset base, banks raising of more funds, thus further exacerbating these profitability and efficiency ratios, according to Usman.

The pressure, therefore, is on banks to return to investors and depositors from large capital raised.

This temptation, he says, has led to increase volume of risk assets resulting in decline in the quality of risk assets, and the use of depositors’ funds to push share prices to appease their investors.

These challenges have led to their determination to generate increasing returns to shareholders, thus encouraging bigger risk taking, and deposit insurance funds face larger potential losses in the event of failure of a single, large consolidated institution.

The result is that depositors’ funds are being held in banks’ own shares at inflated prices, and asset/liability mis-match as depositors’ funds are locked into equity investment.

The minister says the risks associated with margin trading thus include stability of the capital market being impacted by economic trends, and that any downward trend in the economy will impact the capital markets negatively, causing the price of the stocks to decline, and that panic sellers and customers might spell trouble for banks.

He says as stock prices decline, the value of the stocks pledged as collateral to banks for the margin facilities will also decline, leaving no effective cover.

Also, securities used, usually shares, as well as depositors’ funds will be lost if market crashes.

He says margin trading is believed to be largely responsible for the crash of US stock market in 2000.

The minister also notes that sub-prime lending, another reason to be cautious, started as a credit problem in the US mortgage market with delinquency rate of 5 percent in sub-prime.

The problem, he explains, is that with the financial crisis in the global banking system, total reported write-downs for major financial firms is now totalling $161 billion and estimated to reach $200 billion this quarter.—BusinessDay

Gowon, operators, NAFDAC, Onyiuke laud Fidson listing on NSE *First to introduce ARV

2008-06-17T04:32:00.000+01:00

Fidson Healthcare Plc, a newly quoted company on the Nigerian Stock Exchange (NSE) received overwhelming support from chieftains of industries, capital market operators and regulators during the listing of its shares.

Former Head of State of Nigeria ,General Yakubu Gowon and his wife, Director General of National Drug Law, Enforcement Agency (NAFDAC, Professor Dora Akunyili , Mr. Felix Ohiwerei, Professor Oladipo Akinkugbe were among the dignitaries that endorsed the listing of the shares of Fidson Healthcare Plc.

Yakubu Gowan said “ I am very much excited with the growth of Fidson. For Felix Ohiwerei who is chairman of chairmen of quoted companies on the board of the Fidson means that the company had performed extremely well. I will commit my little money on the company when it comes out with its Initial Public Offeing (IPO).I and my family will show our solidarity and support for the company having gone so far within its short period of existence.

In the same, NAFDAC boss, Professor Akunyili commended the company for its stride. According to her “ NADFAC has followed this company right from scratch to this period it has gone public. This is really a Nigerian company with all of its board and management staff indigenes of the country. We have scrutinized this company and they have followed all the tenets of the profession.

I am endorsing this company today in the capital market community because it is a company to emulate by others.

Director-General , Nigerian Stock Exchange (NSE) was full of praises for the promoters of this company who had the vision of the building a world class company of this nature and taking it to the stock market for the entire public to invest in . It is highly commendable”.

Mr. Felix Ohiwerei also commended the company. “ Before I joined the company I made thorough research about the company and its books and they might my kind of company that has respect for corporate governance. Since I retired as executive management of companies I had always told my self that I will continue to add value using my wealth of experience to companies that are ready to subject themselves to public scrutiny and accountability.

Fidson is one of those companies” he noted.
The capital market community were full of praises to see a company originated , grown and nurtured by Nigerians to be listed on the Exchange.

Over the years, Fidson Healthcare Limited tenders well over one hundred and thirty drug products in different therapeutic groups and has perfected brands portfolio management.

Innovating for improvement has become the culture. Quality assurances on all spheres, employment and continuous training of manpower and process improvement have all received massive attention.
Recently the company has shifted its attention towards building a corporate Head Office
commensurate with its standing in the industry; actually a dream home before an office with all the appurtenance of an ultramodern world-class office structure. This structure will enhance the company’s administrative fluidity, excellent service delivery and atmosphere of friendliness, warmth and professionalism.

This six-story building, complete with a pent house is located on the very accessible Ikorodu road, Lagos, Nigeria complete with facilities that will ensure conducive work environment and greater performance.

According to the Managing Director/CEO, Fidson Healthcare, Mr. Fidelis Ayebae
“ We at Fidson Healthcare are committed at all times to offering our customers the highest quality healthcare products and services. In achieving this we always engage highly dedicated people in processes that conform to Global best practices in the most cordial environment.

Our Vision is to become and remain the most preferred and leading healthcare providers in our sub-regions. Our mission is to provide high quality healthcare products to the consuming public in an efficient and ethical manner at affordable prices through highly motivated professionals with a passion for excellence and credibility, using modern technology. Our Motto is that we value life.

Our commitment is to become a Nigerian multinational committed to providing a wide spectrum of drug products to our customers. We are also committed to remaining the single private initiative employing the highest number of pharmacists in the country”.

Fidson Healthcare Plc has evolved into Nigeria’s foremost indigenous healthcare provider.
The company commenced operations in 1995 with a vision to change the course of healthcare delivery in our sector.

Over the years we have pursued this goal with zeal and have established our grounds in very important areas including pharmaceutical, consumer goods, human capital development, R & D, products distribution and responsive corporate initiatives.

At inception, the company started as Fidson Drugs with focus on local distribution. Within the first year, the company expanded her business scope into importation and distribution of our brands of quality products such as Ciprotab, Meprasil, Astymin and Astyfer.

Within six years, the company commenced operations in her ultramodern manufacturing facility in Sango, Ota, and Ogun state. Since that feat was achieved five years ago, the company has moved into greater accomplishments by investing in another bigger and sophisticated manufacturing plant, also in Sango, Ota, Ogun state.

Presently, the first factory has been dedicated as a contract manufacturing facility ECOMED Pharm Limited; to enable aspiring entrepreneurs who could not afford the high cost of setting up manufacturing plants to achieve their goals maximally.

Just like the proverbial mustard seed, Fidson Drugs has transformed to Fidson Healthcare
And has grown into a “Mighty Oak” giving birth to FIL Pharmaceutical, Biofid, Fidson Products, Nature Remedies, Extra Print and Wide-Net Impex as subsidiaries.
Factory Operations

Ayabae stated that the state of the art manufacturing facility located on a landmass of about two (2) acres is aesthetically laid out in accordance with current WHO. GMP and safety requirements.

“The plant is equipped to manufacture five (5) distinct lines of products. Liquids Powder Cream Tablets Capsules.Other operations at the facility include filling, blistering, labeling, packaging, and cartonation. We are the first indigenous company to produce Anti Retroviral drug (ARV)
In pursuit of our philosophy to provide world-class drugs, our factory is manned by a fine blend of professionals whose primary duty is to uphold the integrity of our products and safety of our customers. We On research and development, Fidson boss said

This is the nerve center of our products development and lines extension. We are constantly refining and distilling our scientific thoughts to formulate novel drugs such as Virex, our range of anti-retroviral (ARV), Gascol Antacid, Tribotan range of dermatology products, Cephalosporine and others. Our R & D has provided opportunities for medical scientists and researchers to engage in product reformulation for usage extension, increased efficacy, clinical studies and academic training.

It is to the credit of this department that we have well over one hundred and twenty (120) high quality products that satisfy the health needs of o\ discerning publics.This department is manned by a dynamic group of scientists of impeccable credentials.

Marketing Operation
Fidson Healthcare is known in the industry for her range of products,. Apart from being the first indigenous manufacturers of liquid and solid dosage forms of anti-retrovirals in Nigeria, the company plays in key therapeutic areas.

For greater focus and pro-active performance, our marketing operations are structured along the following lines:Anti-arthritis/Pain relief, Anti-infective, Endocrinology, Gastro-intestinal Analgesics, Neutraceuticals Consumers Export management Haematinics, Anti-malaria, Biologicals Human Resources

At Fidson Healthcare, human capital is our most important asset. Since our well being rests on the staff, a high premium is placed on ensuring a motivated personnel from diverse educational backgrounds, the pool of talents at our disposal is being efficiently harassed and this explains this explains the rapid pace of our ascent.

Being aware that our corporate success depends on the excellence of our workforce, our HR is consistently being re-engineered to produce and retain premium quality staff at all times.
Teamwork is recognized as a contributory singular factor for every achievement we have made so far hence, our corporate policy of making our work environment “home before a workplace”.
Ours is a company that combines a youthful and resourceful management team, result-oriented, highly motivated and passionate workforce.

Corporate Services
Fidson Healthcare believes that her customers and suppliers are partners in progress. Having bought into this corporate vision, Corporate services department strives to be responsive to our partners demands and those of the community in which we operate; intact. Fidelity to our corporate social responsibility (CSR) is inviolable.

This is why the company engages in sponsorship of professional bodies and individuals, promotion of youth football sponsorship of international sporting events and leadership training and schools. ..:,, ,
Being well known in the industry for efficacious drugs production and distribution, we have also backed these lines up with the production of high quality informative marketing and communications materials for relevant professional bodies and the consuming publics.

We want to be distinguished in our sub sector for providing the consumers with credible solutions to their problems at affordable prices at their doorstep.

The company management team is made up of keen students of entrepreneurship who are people- oriented, very responsive and believe in continuing education.

The team is multi-disciplinary; comprising managers skilled in R & D, products development, marketing, sales, finance, administration, social research and marketing communications.
The primary duty of this team is empathetic and efficient customer service, high premium brands production, consistent research and cost efficiency.—Vanguard

STOCK MARKET REPORT FOR THE WEEK ENDED FRIDAY, 13TH JUNE 2008

2008-06-17T04:24:00.000+01:00

A turnover of 3.71 billion shares worth N53.93 billion in 75,156 deals was recorded this week, in contrast to a total of 5.06 billion shares valued at N74.9 billion exchanged last week in 83,613 deals.

Transactions during the week included a total of 717,000 units of Access Bank Plc N13.5 billion Redeemable Bond 2010 valued at N717 million.

There were no transactions in the Federal Government Development Stocks, State Government Bonds and Preference Stocks sectors.

The Insurance subsector was the most active during the week (measured by turnover volume), with 1.6 billion shares worth N3.95 billion exchanged by investors in 11,020 deals. Volume in the Insurance subsector was largely driven by activity in the shares of Investment and Allied Assurance Plc. Trading in the shares of the Insurance Company accounted for 741.84 million shares, representing 46.82% of the subsector’s turnover.

The Banking subsector, boosted by activity in the shares of PlatinumHabib Bank Plc, Intercontinental Bank Plc and Access Bank Plc, followed on the week’s activity chart with a turnover of 1.51 billion shares valued at N39.9 billion in 35,490 deals.

Last week, the Insurance subsector led on the activity chart and was followed by the Banking subsector.

Price Movement:
The All-Share Index rose by 7.04% to close on Friday at 60,191.83. The market capitalization of the 206 First -Tier equities closed lower at N11.72 trillion.

Ninety - Two (92) stocks appreciated in price during the week, higher than the twenty - five (25) in the preceding week. Nestle Nigeria Plc led on the gainers’ table with a gain of N11.25 to close at N236.25 per share while Ashaka Cement Plc followed with N8.48 to close at N45.79 per share. Other price gainers in the Top 10 category include:

• Julius Berger Nigeria Plc - N5.45

• Chemical & Allied Products Plc - N4.98

• Eterna Oil & Gas Plc - N3.39

• Chevron Oil Nigeria Plc - N2.50

• Guinness Nigeria Plc - N2.35

• Nigerian Breweries Plc - N1.54

• Japaul Oil & Maritime Services Plc - N1.52

• John Holt Plc - N1.49

Ninety - Five (95) stocks depreciated in price during the week, higher than the ninety – five (95) in the preceding week. United Bank for Africa Plc led on the price losers’ table, dropping by

N26.42 to close at N32.78 per share while Mobil Oil Nigeria Plc followed with a loss of N12.00 to close at N187.50 per share. Other price losers in the Top 10 category include:

• Conoil Plc - N8.60

• Costain (WA) Plc . - N7.48

• Flour Mills Nigeria Plc - N6.90

• Skye Shelter Fund Plc - N6.15

• Lafarge WAPCO Plc - N6.00

• First Bank of Nigeria Plc - N4.41

• Dangote Flour Mills Plc - N4.02

• Dangote Sugar Refinery Plc - N3.87

The price of Guaranty Trust Bank Plc was adjusted for final dividend of N0.70 per share and bonus of 1 for 11 as recommended by the Board of Directors.

Supplementary Listing

A total of 1,259,090,909 shares were added to the shares outstanding in the name of Guaranty Trust Bank Plc following the bonus of 1 for 11.

Delisting

The FGN Bond 2012 (Local Contractors Debt Series 3) was delisted from the Daily Official List. By this action, the number of FGN Bonds and securities dropped to 43 and 316 respectively.

COMPANY NEWS

INTERCONTINENTAL BANK PLC: Audited result for the year ended 29th February 2008 shows Gross Earnings of N173.6 billion as against N87.4 billion in 2007. Profit after tax stood at N34.8 billion compared with N15.5 billion in 2007. The Directors are recommending a final dividend of N0.40 per share. The date of closure of register of members is June 20, 2008 while payment date would be advised later. The stock price had on December 17, 2007 been adjusted for an interim dividend of N0.35 per share, thus bringing the total cash dividend to N0.75 per share.

BIG TREAT PLC: Audited result for the year ended 31st December 2007 shows Turnover of N3.0 billion as against N1.6 billion in 2006. Profit after tax stood at N245.9 million compared with N131.1 million in 2006. The Directors are recommending a dividend of N0.10 per share. The date of closure of register of members is July 7, 2008 while payment date is July 18, 2008.

NIGER INSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N3.9 billion as against N3.14 billion in 2006. Profit after tax stood at N657.02 million compared with N589.6 million in 2006. The Directors are recommending a dividend of N0.15 per share. The date of closure of register of members is June 23, 2008 while payment date is July 31, 2008. The 38th Annual General Meeting (AGM) of shareholders is scheduled to hold at Transcorp Hilton Hotel, Abuja on July 10, 2008 by 11.00a.m.

PRESTIGE ASSURANCE PLC: Audited result for the year ended 31st December 2007 shows Gross Premium of N2.3 billion as against N1.54 billion in 2006. Profit after tax stood at N638.1 million compared with N407.4 million in 2006. The Directors are recommending a dividend of

N0.20 per share and bonus of 1 for 4. The date of closure of register of members is July 8, 2008 while payment date is August 4, 2008. The Annual General Meeting (AGM) of shareholders is scheduled to hold on July 31, 2008.

PRESTIGE ASSURANCE PLC: Unaudited result for the first quarter ended 31st March 2008 shows Gross Premium of N661 million, as against N435 million in the comparable period of 2007. Profit after tax stood at N215 million compared with N169 million in 2007.

BENUE CEMENT CO. PLC: Unaudited result for the first quarter ended 31st March 2008 shows Turnover of N1.04 million, as against N1.8 billion in the comparable period of 2007. Profit after tax stood at N139.1 million compared with profit after tax and exceptional items of N536.8 million in 2007.

INTERNATIONAL ENERGY INSURANCE CO. PLC: Unaudited result for the first quarter ended 31st March 2008 shows Gross Premium of N980.3 million, as against N309.3 million in the comparable period of 2007. Profit after tax stood at N320.15 million compared with N98.9 million in 2007.

REPORT ON THE OTC MARKET FOR FGN BONDS

A turnover of 131.3 million units worth N135.6 billion in 943 deals was recorded this week, in contrast to a total of 202 million units valued at N208.7 billion exchanged in 1659 deals during the week ended June 5, 2008. As in the preceding week, the most active bond (measured by turnover volume) was the 3rd FGN Bond 2009 Series 11 with a traded volume of 19.0 million units valued at N20.85 billion in 187 deals.

Source: Nigerian Stock Exchange

Intercontinental Bank Plc post 125 percent profit.

2008-06-17T04:20:00.000+01:00

Intercontinental Bank Plc post 125 percent profit.

Intercontinental Bank Plc has made available its financial results for the year ended February 2008 to trading members of the Nigerian Stock Exchange. A summary of the Banks results showed that its deposit base reached N1.05 trillion from N468 billion in the previous year indicating a growth of 126 percent. Its gross earnings grew by 99 percent from N87.4 billion in the previous year to N173.5 billion.

Profit before tax grew by 102 per cent to N45.6 billion as against N22.6 billion in 2007. Profit after tax also recorded a phenomenal growth of 125 percent to N34.8 billion during the period under review. The banks capital base increased from N157 billion in 2007 to N200 billion in 2008.
It is proposing to pay a total dividend payout of N13.5 billion made up of the N6.3 billion paid to the investors as interim dividend last September and the N7.2 billion to be paid as final dividend payout to investors. This translates to 40 kobo per share compared to 35 kobo paid as interim dividend, bringing the total dividend per share for the year to 75 kobo.

ValuCard goes global

2008-06-16T11:50:00.000+01:00

ValuCard Nigeria Plc has transformed from being a local payment card scheme to a global payment card service provider.

A statement by the company on Saturday said that by the transformation, the company would no longer have or support any payment card, branded with its corporate name, logo or trademark.

The company would also no longer deploy signages at merchant locations that indicated usage or acceptance of cards issued under its name, logo or trademark, it said.

It said the company would now provide services in compliance with international best practices and standards; and would work with Visa International Services Association, a shareholder of the company to develop the Nigerian market.

According to the statement, ValuCard will provide services, which include merchant acquiring services, bill payment, distributorship, retail and collection solutions, non-resident investors’ payment solution, supply and personalisation of payment cards among others.—Punch

Swap Technologies set for listing

2008-06-16T11:48:00.000+01:00

Swap Technologies and Telecomms Limited has said that plans are underway for it to list its shares on the floor of the Nigerian Stock Exchange.

The company will be listing its shares to raise the needed funds for expansion projects, aimed at boosting it’s capital and making it a major player in the telecoms industry.

A statement by the company on Saturday said that the company, which was currently undergoing a private placement, sought to be one of the leading and profitable telecoms companies in the next few years.

According to the statement, “The company, which is a leader in the telecommunication infrastructure business in Nigeria, is expected to seek listing on the NSE after concluding the placement. It will be one of the first in that sector on the NSE, as, presently, no company in the telecoms sector is listed.”

It stated that the company had great plans for expansion, and hoped that its shares would be the toast of investors after the listing.

“The company, which has been able to establish itself as a key player in the business of importation of telecom infrastructure equipment, is pursuing some major acquisitions operation in the Mobile Virtual Network,” the statement said.

This, it said, would consolidate its leadership position in the sector and fully realise its vision of becoming one of the top five quoted conglomerates in Nigeria by 2011.—Punch

House C’ttee Okays Zenon’s Acquisition of AP Shares

2008-06-16T11:42:00.000+01:00

A report by the House of Representatives Committee on Privatisation and Commercialisation has described the acquisition of majority shares of African Petroleum (AP) by Zenon Petroleum and Gas as transparent

The report also recommended that the Federal Government should constitute a Judicial Commission of Inquiry to find a solution to the problem that resulted from the sale of the shares

The report added that the proposed Commission’s white paper and gazette on its findings be made public so that no party would feel cheated.

The report obtained by THISDAY also recommended that Dr. Abba Gana, who managed AP before Sadiq Petroleum became the core investor and its chief accountant, Mr. Alabi, be made to face the Economic and Financial Crimes Commission (EFCC) and their accounts in Nigeria and abroad frozen.

The Committee had pursuant to a resolution on the petition presented by Sadiq Petroleum Nigeria Limited dated 19th November 2007, in line with Order XIV, Rule 3 (I) (I11), and in order to give fair hearing to all parties involved with the sales transactions of the Federal Government’s 30 per cent AP shares, conducted a one-day open investigative hearing. THISDAY gathered that the lawmakers’ recommendation would be tabled when the House resumes from its two weeks short break.

“The Management of AP Plc under Ibrahim Abba Gana was responsible for the huge debt owed NNPC, and in fact, the hidden debt that was not disclosed to Sadiq Petroleum Ltd, at the time it purchased 30 per cent Federal Government equity shares in AP Plc.

“Therefore, to serve as a deterrent to others and in order to avoid a repeat of such, Mr. Abba Gana and his Chief Accountant, Mr. Alabi, should be made to face the EFCC while their accounts within and outside Nigeria should be frozen,” the report stated.

The report endorsed Zenon’s take over of AP’s shares as having followed due process.

“Since the sale transaction, which culminated in Debt-to-Equity Swap was a ‘life saver’ to save AP Plc from folding up and since this was conditional on NNPC Pension Fund and in order to allow for the sale process to be transparent, it was important that the Nigerian Stock Exchange (NSE) did the sale of AP Plc shares in accordance with due process by way of tender offer for sale,” the report stated.

The report stated that, “the sale transaction followed due process and accordingly, recommend(ed) that Zenon Petroleum and Gas Ltd, a company with vast resources in petroleum products supply and distribution, be allowed to hold on to (its) equity stake in African Petroleum Plc.”

The lawmakers had said they adopted the open investigative hearing to eliminate restraints and limitations, adding that it invited all the parties involved in the sales transactions to present their sides of the deal.

Those invited were the Director-General of the Bureau of Public Enterprises, Dr. Irene Chigbue; Chairman of Sadiq Petroleum Nigeria Limited, Mr. Peter Eloka Okocha; Director-General of the NSE, Dr. Ndi Okereke-Onyiuke; Director-General, Securities and Exchange Commission (NSE), Musa Al-Faki; Petroleum and Natural Gas Senior Staff Association of Nigeria (PENDASSAN) representatives; the Company Secretary of ENL Consortium; representatives of the Nigerian National Petroleum Corporation (NNPC), Aminu Ibrahim & Co.

Both NUPENG and PENGASSAN had protested the alleged irregularities that followed the sale of NNPC Staff Pension Fund 28.7 per cent equity interest in AP Plc to Zenon Oil.

They had complained about the process leading to the transaction, the denial of the shareholders, both current and retired staff of NNPC, the right to freely know whether to redeem the N10.7 billion debt owed by AP Plc to the corporation (NNPC) to reduce the under-funding gaps in NNPC Staff Pension Fund Account that had grown to about N100 billion. - ThisDay

Reactions trail the Nigerian Stock Exchange’s stock prices freeze

2008-06-13T05:41:00.000+01:00

In a development that is aimed at saving the seemingly declining confidence of the investing public, the management of the Nigerian Stock Exchange, on Monday, in an unprecedented attempt at halting the further slide in share prices of equities listed on the Nigerian Stock Exchange, suspended listed stock prices from further decline. This suspension is expected to last one week, while the NSE tries to convince the Central Bank of Nigeria (CBN) to reexamine its decision on Margin Trading. In effect, all stocks that would have been marked down are to revert to their close price as at June 6, 2008.

It would be recalled that the CBN had earlier this year, issued a stop order to banks running margin accounts. There were worries that margin trading is risky in the sense that using borrowed funds to invest in securities, amplifies gains and losses. Analysts further opined that the use of borrowed funds in speculative activity was tantamount to gambling. However, there are unverified claims that the leverage in the market is estimated at N2.5tr or 18 per cent of market capitalization.

Capital market operators have now attributed the CBN directive to the persistent slide in the All Share Index and the Market capitalization, which dipped by 13 per cent or N1.65tr between March 6th 2008 and 9th June, 2008. The All Share Index also witnessed a decline that left it closing at 56,407.80, down from 66,371.20 in March 9th 2008. Regulators are of the opinion that most of the stocks are undervalued, and that this move is necessary to arrest a further decline in investors’ interest.

While some have reacted to the action of the Nigerian Stock Exchange in an optimistic manner, others urge restraint, as the NSE makes move to give impetus to market indices. In an interview, an expert likened the NSE’s directive on price movement as, “…introducing circuit breakers without any support”, adding that “…freezing the market now is a sign of panic by the regulators, which would make the investors panic more.”

3 Nigerian banks to operate in South Africa

2008-06-12T10:06:00.000+01:00

The South African government has endorsed three Nigerian banks - First Bank, Union Bank and United Bank for Africa (UBA), to commence retail banking in that country.

Ojo Maduekwe, Minister of Foreign Affairs, disclosed this in Abuja today when be briefed newsmen on the outcome of President Umaru Yar’Adua’s recent visit to South Africa.

He pointed out that Nigerian banks had been making efforts to break into the South African financial and banking sectors without success.

“During the visit, President Yar’Adua took up this issue with his counterpart, Thabo Mbeki who instructed the Reserve Bank of South Africa to permit the three banks,” Maduekwe said.

On the N110,000 refundable deportation fee for Nigerian visa applicants by South African Missions, he said Mbeki also promised to revisit it.

“Mbeki also agreed to the reciprocal waiver of visa requirements for holders of diplomatic and official passports,” Maduekwe said.

The minister reiterated governments’ decision to compile names of affected Nigerians who suffered the xenophobic attacks for compensation by the South African authority.

He commended the South African government for putting a moratorium on the deportation of illegal immigrants.

Maduekwe added that the leaders agreed to fast-track implementation of the 22 bilateral agreements between both countries some of which had been dormant. (NAN)—BusinessDay

Custodian and Allied Insurance to outperform peers

2008-06-12T09:31:00.000+01:00

The first quarter of this year witnessed 7 companies approaching the Nigerian Capital Market to raise additional funds for branch net work expansion, technological advancement, improved workforce, purchase of new equipments, boast working capital, among others in a drive to position themselves strategically to play favorably in their individual sectors and evolving market. Within the period under review, the over all size of the new as well as right issue amounted to 22.49 billion units which amounted to N166.59 billion. This figure shows that majority of Nigerian companies are now seeing the capital market as key source of raising fresh capital for expansion. Going by previous records on the performance of issues like these, we expect heavy over subscription and few allotment issued to applicants requesting for large volume.

In the Banking sub-sector we had the likes of Skye Bank Plc, offering 2,231,599,145 Ordinary shares at N14 per share and First Inland Bank Plc, offering 4,000,000,000 Non-Cumulative Convertible shares at N9.50k per share, 5,000,000,000 Ordinary shares at N9.50k per share, as well as 968,863,000 Rights Issue at N8.50k per share. Within the Insurance sub-sector, we had Standard Alliance Insurance Plc with an offer for subscription of 4,750,000,000 ordinary shares at N3.95k per share and Custodian & Allied Insurance Plc offering 350,000,000 ordinary shares at N5.20k per share and 400,000,000 Rights issue at N5.20k per share. Daar Communications Plc and Daar Investment & Holding Company Plc came out for their Initial Public Offering of 1,829,478,000 and 960,000,000 Ordinary shares respectively at N5 per share each.

Allotment approved (January – March 2008)

A total of thirteen companies’ allotments were approved by the Securities and Exchange Commission (SEC) between January and March, 2008. These include – Access Bank Plc, Dangote Flour Mills Plc, Goldlink Insurance Plc, Nigerian Aviation Handling Company Plc, International Breweries Plc, First City Monument Bank Plc, Japaul Oil & Maritime Services Plc, Nigerian Bags Manufacturing Company Plc, Thomas Wyatt Nigeria Plc, DVCF Oil & Gas Plc, Afribank Nigeria Plc,

Fidelity Bank Plc and Chams Nigeria Plc.

We expect this double reward to positively impact on its price to take it to a new all time high. Our projection before the closure of its books in June is N85. However, our medium term projection is N60, ie after adjusting its price for the cash dividend and scrip issue.

Bank PHB

The bank has demonstrated strong ability to grow its turnover, and earnings at a rapid rate. Its latest quarterly result showed the banking growing its PAT by over 250%. If this trend is sustained, Bank PHB will certainly outperform its projections. Our price forecast place the stock at N36 for the medium term (6 to 9 months).

University Press plc

We expect the federal government UBE policy to impact greatly on University Press Plc. It is a growth stock that promises impressive returns to investors in the medium term. University Press had traded at a year high of N15.43 and our estimation for the medium term shows that the stock may hit N17.20 within the next 9 months. Investors may consider taking position in the stock for medium to long term investment decision.

Oceanic International Bank plc

Oceanic is in the first tier banks when measured by shareholders’ fund, total asset, total deposits among others. It has been trading at a relatively low price when compared with its peers in the first tier category. Going by its half year result released recently, Oceanic bank posted a PAT of over $20 after posting over $8 billion in its first quarter, showing a more than proportionate growth rate. By annualizing this, our estimate shows that Oceanic will post at least $44 billion by its FYE on September 30, 2008. The key problem behind its low price is as a result of. We strongly believe there is hidden value in the stock as the current market tempo provides unusual chance for astute investors. However, Oceanic Bank’s ability to enjo strong rally may be weakened by its large flood of shares in issue.

Our Medium term forecast gives us N39.50

Custodian & Allied Insurance Plc

Since its listing on the floor of the NSE in 2007, Custodian & Allied Insurance has maintained a strong resistance to generally market swings. Though, the market was bearish which made the stock relatively expensive, investors still maintained their confidence in the stock as it remained on strong demand. In its latest audited account for the year ended December 31, 2007, Custodian & Allied rewarded its shareholders with an impressive cash dividend of 14. Custodian & Allied has a niche for itself and with its visionary management, we expect the firm to outperform most of its older peers in the years ahead.

Our price forecast put it at N8.00 for the medium term.

Flour Mills Nigeria plc

Flour Mills has maintained a strong corporate brand and business model with diverse products portfolio which provide it’s a larger stream of income. Its current price is relatively low when we bring into account its current EPS of N4.68 and a PE multiple of 18.80xs. The stock is a good pick for value investors who are looking for medium to long term return.—BusinessDay