BusinessDay 14 Dec 2017

Thursday 14 December 2017 C002D5556 BUSINESS DAY 13
COMPANIES
& MARKETS
Company news analysis and insight
‘We pioneered
programmatic
technology in
Nigeria’
P 14
Fidson Healthcare consistent earnings’
growth lures investors to stock
BALA AUGIE and
DAVID IBEREME
Fidson Healthcare
Plc’s consistent
earnings growth
combined with an
aggressive expansion
plan, has remained appealing
to investors as they
continue to find the stock of
the drug marker attractive.
The shares have gained
199.20 percent since the start
of the year, outperforming
the Nigerian Stock Exchange
(NSE) All Share Index (ASI) of
44.84 percent.
It is one of the best performing
stocks on the exchange.
Analysts are of the view
that the increase in the drug
makers’ stock price was as a
result of its new World Health
Organisation (WHO) compliant
ultra-modern manufacturing
facility which it completed
in the mid half of the
year in Sango Ota Ogun state.
For the first nine months
through September 2017, Fidson
Healthcare’s net income
surged by 790.05 percent to
N730.05 million as against
N82.07 million as at September
2016.
Sales spiked by 127.87 percent
to N10.30 billion in September
2017 as against N4.52
billion as at September 2016.
Experts added that the
recent decision of government
to ban the importation
of some drugs will result in
increased capacity for local
manufacturers that could result
in increased revenue for
local manufacturers of drugs.
Drug makers in Africa’s
largest economy and most
populous nation grappled
with paucity of foreign exchange
scarcity that was disruptive
to the industry.
However, the introduction
of the Investors’ and
Exporters’ window by the
central bank in early in the
year resulted in increased dollars
hence easing the pains of
manufactures.
Fidson Healthcare is efficient
as net margin increased
to 70.90 percent in the period
under review as against 18.12
percent as at September 2016.
However, weak currency
ballooned the drug makers’
cost of production as it
imports 80 percent of its raw
material except water.
An industry expert told
BusinessDay that it takes more
than 15 raw materials to manufacture
a drug.
Fidson HealthCare’s cost of
sales surged by 136.14 percent
to N5.07 billion in the period
while gross margins dipped
to 50.6 percent in September
2017 as against 52.62 percent
in September 2016.
While the major pharmaceutical
firms quoted on the
floor of the bourse have seen
share appreciation on the
back of earnings growth and
aggressive expansion plan,
the industry is plagued with
challenges that are hindering
its growth.
The influx of cheap imports
that continue to compete
against locally produced
medicines and significant
energy costs.
Meanwhile, ECOWAS
Common External Tariff
(CET), introduced in 2015 has
continued to remain a contentious
issue that threatens the
existence of local manufacturers.
According to Fidson
Healthcare the regulatory interaction
and advocacy that is
on-going to introduce tax adjustment
tariffs would favour
local manufacturers and moderate
the long term impact of a
free regional trade zone within
West Africa.
Eunisell wants Geo Fluids liquidated over $265,492 debt
Ignatius Chukwu
Out of court settlement
has broken down in
a case between two
firms over supply of
chemicals and alleged failure to
pay. Now Eunisell Limited goes
ahead demanding for the winding
up of Port Harcourt based
Geo Fuids Limited owned by
Alali Ibanibo.
The parties had taken two
adjournments to resolve a case
of owing $265,492 for supply of
several drums of chemicals to
Geo Fluids by Eunisells as far
back as 2010. The case came to
court in 2012.
The amount by 2010 when
the supply was made was about
N50m @ N185 per Dollar, and
now about N96.1m @ N362 per
Dollar.
Statement of claim by Eunisell
in an affidavit said Geo Fluids
requested for the chemicals and
they were supplied through two
invoices. Eunisell, in its petition,
said several demands for payment
failed until the company
went to the federal high court
in 2012.
The counter claim by Geo
Fluids said the chemicals were
not original. In another paragraph,
Geo Fluids said they had
made several payments to offset
the debts. The case was last mentioned
on September 23, 2017
and was fixed for December 12,
2017, for hearing. The Petitioner
has Sam Agweh as lead counsel
while the defence is by Salome
Johnson. The Justice is Bilikisu
Aliyu.
The suit has a motion seeking
the advertisement for the
winding up. The motion was to
be heard on Tuesday, December
12, 2017, but due to latest
developments, the moving of the
motion was shifted to January
29, 2018. The motion also contained
clauses that accused the
defendant company of obtaining
the chemicals without intention
to pay and using the chemicals
without paying, something that
they said bordered on fraud.
The Petitioner’s lawyer, Simon
Amadoubogha, leading
Uche Kalu, told the court that it
came to move the motion calling
for winding up because the
plan for settlement did not work
out after all, it broke down. The
court had given more time for
settlement but it did not work
out. The motion was sworn to on
June 15, 2017 and filed in court
on July 3, 2017.
The defence said they filed
a counter motion and that they
were ready in court for the case
to continue.
The justice ordered the case
to proceed and for the Petitioner
to move his motion. His lawyer
now asked for adjournment on
ground that a N5m cheque for
part payment they had wanted
to return to the defendant could
only be returned this morning in
court. In view of this latest development,
the Petitioner needed
time to adjust the records and
move the motion.
The defence did not object
and the Justice gave January 29,
2018 for the case to proceed.
In an interview outside the
court, Amadus said his client was
right to seek liquidation of Geo
Fluids on grounds of inability or
failure to pay. He said the defending
company neither returned
the chemicals if they were not
good nor notified the supplier.
On her own, the defence lawyer,
Johnson, said the Petitioner
did not do proper research to
know if Geo Fluids was viable
and capable to pay its obligations
or not. She said what was at stake
was a mere dispute over payment
for supplies.
Ecobank Nigeria takes banking to
grassroots with Xpress account product
HOPE MOSES-ASHIKE
Ecobank Nigeria has unveiled
Ecobank Xpress
Account, a flagship
digital product that will
take banking to the grassroots.
The Ecobank Xpress Account is
a Digital Account that is mobile
based. It is simple and does not
require any form of documentation
for opening, therefore
making it easy and convenient
for all, while affording the customers
the same services available
to regular account holders.
The Ecobank Xpress Account
can be opened on the Ecobank
Mobile App by smartphone users
and or via USSD for feature
phone users.
At the unveiling ceremony
in Lagos, the Managing Director,
Ecobank Nigeria, Charles
Kie said this is part of Ecobank’s
“Roadmap to Leadership
Initiative”, where Ecobank
is focused on becoming a force
in the banking industry by
leveraging its robust Digital
Channels to drive financial
inclusion for the un-banked
in the different parts of Nigeria
– urban, semi-urban and rural
areas. Kie emphasized that this
new product will also enable
the bank meet its Group Target
of 100 Million Customer by
2020, of which 40 Million will
come from Nigeria.
Also speaking at the launch
Carol Oyedeji, Executive Director
Consumer Banking of Ecobank
Nigeria reeled out the benefits
this account type offers. They
include simple account opening
process without any paper
documentation or stringent
form of identification; ability to
immediately do transactions
from the account and withdraw
cash through the Xpress Cash
via Ecobank Automated Teller
Machine (ATM) or Ecobank
Agent locations.