7 months ago

BusinessDay 10 Apr 2018


Tuesday 10 April 2018 30 BUSINESS DAY C002D5556 Live @ The Stock Exchange Top Gainers/Losers as at Monday 09 April 2018 Market Statistics as at Monday 09 April 2018 GAINERS Company Opening Closing Change GLAXOSMITH N29 N30 1 CHAMPION N2.28 N2.48 0.2 CCNN N17.8 N18 0.2 MANSARD N2.4 N2.52 0.12 FIDSON N5.68 N5.8 0.12 LOSERS Company Opening Closing Change UNILEVER N59.8 N55 -4.8 WAPCO N44.2 N41 -3.2 DANGCEM N254.9 N252 -2.9 GUINNESS N104 N103 -1 DANGFLOUR N13.8 N13.15 -0.65 ASI (Points) 40,429.18 DEALS (Numbers) 4,285.00 VOLUME (Numbers) 287,036,155.00 VALUE (N billion) 4.947 MARKET CAP (N Trn 14.603 Nigerian stock market loses N150bn …as Unilever, Lafarge, Dangote Cement lead laggards Stories by Iheanyi Nwachukwu Nigerian stock m a r k e t lost about N150billion on Monday April 9, 2018 as 30 stocks lost their values against only 17 gainers. President Muhammadu Buhari on Monday declared his intention to seek re-election in 2019. Stocks that led the basket of losers include Unilever Nigeria Plc as well as two cement makers, Lafarge Africa Plc and Dangote Cement Plc. The Nigerian Stock Exchange (NSE) All Share Index (ASI) decreased by 1.01percent, while the Year-to-Date (ytd) return stood at 5.72percent. The All Share Index closed at 40,429.18 points as against the preceding day close of 40,841.14 points while Market Capitalisation closed at N14.604 trillion, against preceding day close of N14.753 trillion, down by N150billion. The volume of stock traded decreased by 42.8percent, from 501.96million to 287.03million, while the total value of stocks traded decreased by 15.37percent, from N5.84billion to N4.94billion in 4,285 deals. At the close of trading by 2:30 pm Nigeria time on April 9, 2018, the share price of Unilever Nigeria Plc recorded highest decline, from N59.8 to N55, down by N4.8 or 8.03percent; followed by Lafarge Africa Plc which declined from N44.2 to N41, down by N3.2 or 7.24percent; while Dangote Cement Plc dipped from N254.9 to N252, down by N2.9 or 1.14percent. Also, Guinness Nigeria Plc dipped from N104 to N103, down by N1 or 0.96percent. GlaxoSmithKline Consumer Nigeria Plc stock rallied most from N29 to N30, up by N1 or 3.45percent; Champion Breweries followed after its share price increased from N2.28 to N2.48, up by 20kobo or 8.77percent; Cement Company of Northern Nigeria Plc advanced from N17.8 to N18, up by 20kobo or 1.12percent. FBN Holdings Plc, Skye Bank Plc, FCMB Group Plc, Zenith Bank Plc and Nigerian Breweries Plc were actively traded stocks on the Nigerian Stock Exchange. The Financial Services sector led the activity chart on Monday with 229.65million shares exchanged for N1.89billion; followed by Consumer Goods with 31.241 million shares traded for N2.855 billion. Lafarge Africa net sales rises by 36% for full year 2017 Lafarge Africa Plc recorded net sales of N299billion in full year results for the year ended December 2017 which represents a 36percent growth compared to the corresponding period in 2016. Recurring Earnings before interest, tax, depreciation and amortisation (EBITDA) doubled to N57.6billion. The CEO of Lafarge Africa Plc Michel Puchercos attributed the strong margins in the Nigerian business to cost initiatives and more favorable pricing. Puchercos disclosed that Lafarge Africa Plc’s industrial operations in 2017 were stable with plants operating at high reliability levels. He also noted that the energy optimization plan for the company has been successful with increased use of Alternative Fuel and Coal to offset gas shortages in operations in the West while plant operations in the eastern and northern part of the country relied mainly on gas and coal. He said these logistic, commercial and operational initiatives helped to sustain market share in the year under review. Lafarge Africa Plc, a leading Sub-Saharan Africa building materials company is a subsidiary of Lafarge- Holcim, a world leader in building materials. Listed on the Nigerian Stock Exchange with a presence in Africa’s two largest economies, Nigeria and South Africa, Lafarge Africa is actively participating in the urbanization and economic growth of Africa. In 2017, Lafarge Africa Plc objective was to optimise its ownership and financing structure. The simplification of its ownership structure was achieved through the delisting of AshakaCem and subsequently a scheme of the re-organisation of capital which enabled minority shareholders to exchange their shares for Lafarge Africa shares. This was successfully closed in fourth-quarter (Q4) 2017. Lafarge Africa Plc now owns 100percent of the shares of AshakaCem. UniCem and Atlas were also merged into Lafarge Africa in Q4 2017 for optimal benefit of the fiscal attributes of merging entities. The South African business thrived in a challenging business environment, operations are set to stabilize in year 2018. The Lichtenburg plant returned to normal operations in the course of the year. A turnaround plan was initiated in order to transform the company’s operations. A detailed review of key projects in Nigeria such as the Road in Calabar and of mothballed assets in South Africa led to an impairment of N19.1bn. The combination of these impairments and the net loss in South Africa of N18.7bn led to a Group Net loss of N34.6bn compared to a profit of N16.8bn in 2016. A final dividend of 150kobo per ordinary share payable from the pioneer profits subject to approval will be paid to shareholders whose names appear in the Register of Members at the close of business on the 27th of April 2018. Lafarge Africa successfully raised N131billion by way of Rights Issue, the largest Rights Issue by size raised in Nigeria so far. Minority participation was in the 50s, while LafargeHolcim subscribed to the un-allotted portion. This brings the ownership of Lafarge Holcim to 76.32percent from 71.35percent prior to the Rights Issue “The expected recovery in the macroeconomic environment in Nigeria is likely to have a positive impact in the overall cement market in Nigeria. CPMI, IOSCO provides guidance on harmonisation of critical OTC derivatives data elements A new report provides technical guidance to authorities on harmonised definitions, formats and usage of a set of critical data elements for over-the-counter (OTC) derivative transactions reported to trade repositories, excluding the Unique Transaction Identifier (UTI) and the Unique Product Identifier (UPI). Entitled Harmonisation of critical OTC derivatives data elements (other than UTI and UPI), the report is published jointly by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO). The guidance helps achieve the goal set by the Group of 20 for all OTC derivatives contracts to be reported to trade repositories, as part of a commitment to improve transparency, mitigate systemic risk and prevent market abuse. Harmonised critical data elements facilitate the consistent global aggregation and analysis of OTC derivatives transaction data reported across trade repositories. Authorities can then use this information to meet their legal obligations and prudential responsibilities. Aggregating data helps provide authorities with an overview of activity in the OTC derivatives market so that they can better assess the risks to financial stability. The report provides guidance on the harmonisation of data elements related to dates, counterparties, regular and other payments, valuation and collateral, prices and quantities, packages, links and custom baskets. The guidance is global in scope and jurisdiction-agnostic, taking account of any relevant international technical standards. The report does not prescribe which critical data elements should be reported in a given jurisdiction. Rather, if jurisdictions require such data elements to be reported, this document guides authorities in setting the definitions, format and allowable values.

Tuesday 10 April 2018 NEWS ANALYSIS C002D5556 BUSINESS DAY 31 Buhari’s second term declaration: Matters arising The declaration by President Muhammadu Buhari for second term did not come to many political commentators as a surprise. Owede Agbajileke writes that to most analysts, what would have been news was if President Buhari had declined to re-contest for the 2019 general elections. They hinged their argument on the fact that the President’s body language had already indicated that he would run for second term. Recall that his Chief of Staff, Abba Kyari; Secretary to the Government of the Federation, Boss Mustapha; presidential spokesmen, Femi Adesina and Garba Shehu as well as minister of communications, Adebayo Shittu; the embattled All Progressives Congress (APC) national chairman, John Odigie-Oyegun, among others, had declared that Buhari would seek reelection in the forthcoming general elections under the governing party. Following his formal announcement at the APC National Executive Committee (NEC) on Monday, the retired general has defied elder statesmen, retired generals and former presidents - Olusegun Obasanjo and Ibrahim Babangida, who had earlier asked him not to seek re-election and give way for younger generation. Buhari, 75, will be contesting with other younger Nigerians who have thrown their hats in the ring, like: 47-year-old Sahara Reporters publisher, Omoyele Sowore, and 54-year-old former deputy governor of Central Bank of Nigeria (CBN), Kingsley Moghalu. Leader of the Northern Elders Forum (NEF), Tanko Yakasai, described the declaration as “no news,” adding, “Nigerians had abandoned the APC long ago.” The elder statesman who stated that the declaration did not take him by surprise, attributed his reaction to how the President’s supporters “had been behaving.” “His supporters did not seem to know that Nigerians have changed their mind about the APC. My advice to Nigerians is that they should be more conscious about their future and the future of their children.” Former minister of special duties, Tanimu Yakubu, while also reacting, expressed happiness that the President was re-contesting the election. Yakubu, a chieftain of the People’s Democratic Party, PDP, in a telephone interview with Business- Day in Abuja, said the party would be happy to square it up again with President Buhari. “We are happy because, it is going to be a rematch with President Buhari. It is the President that we want to defeat,” adding, “We are happy that the APC is most likely to represent him for the 2019 Presidential election. “Nigerians are fully aware of the misrule, fragmentation and neglects” the APC had visited on Nigeria since the inception of the current administration. “We are not afraid of the APC and the President because they have created more division and insecurity among Nigerians than they inherited,” Yakubu said. He added that the PDP is however working to conduct the most transparent, free and fair primaries that will produce their own candidate. “You know the PDP is the biggest party in Nigeria, we are working to produce our candidate through free, fair and transparent primaries,” he said In what could be described, as a case of ‘one man’s meat is another man’s poison,’ while Tunde Bakare, Lagos cleric and running mate to Buhari in the 2011 presidential election, kicked against the President’s re-election, Kano State governor, Abdullahi Ganduje, had threatened to drag the President to court should he not seek re-election. In what shocked many people, Mrs Buhari in 2016 warned her husband that she might not back him at the next election unless he shook up his government President Muhammadu Buhari By Monday’s announcement, Buhari had failed to tow the line of late South African President, Nelson Mandela, who refused to seek re-election on the platform of the African National Congress (ANC) despite pressure from many quarters. The development made him the cynosure of all eyes in the international community. What next for Aisha Buhari, Alhassan? Observers are watching keenly the next moves by wife of the President, Aisha Buhari, and minister of women affairs, Aisha Alhassan, who had earlier passed a vote of no confidence on the President. In what shocked many people, Mrs Buhari in 2016 warned her husband that she might not back him at the next election unless he shook up his government. In an interview with the British Broadcasting Corporation (BBC), Aisha Buhari suggested his government had been hijacked by only a “few people,” who were behind presidential appointments. She said the President did not know most of the officials he had appointed. “The President does not know 45 out of 50 of the people he appointed and I don’t know them either, despite being his wife of 27 years.” She said people who did not share the vision of the ruling APC were now appointed to top posts because of the influence a “few people” wield. “Some people are sitting down in their homes folding their arms only for them to be called to come and head an agency or a ministerial position,” she said. In the same vein, in 2017, Aisha Alhassan, restated her position that she would support a former vice president, Atiku Abubakar, for the 2019 presidential election. In an interview with BBC Hausa, Alhassan, popularly called Mama Taraba, added, “If President Muhammadu Buhari decides to contest in 2019, she would still support Mr. Abubakar. “Atiku is my godfather even before I joined politics. And again, Baba Buhari did not tell us that he is going to run in 2019. Let me tell you today that if Baba said he is going to contest in 2019, I swear to Allah, I will go before him and kneel and tell him that ‘Baba I am grateful for the opportunity you gave me to serve your government as a minister but Baba just like you know I will support only Atiku because he is my godfather. If Atiku said he is going to contest,” the minister said in Hausa. Although both women are yet to react to the President’s declaration, analysts say it shows the level of discontent with the president’s leadership, who was elected in 2015 on the platform of change. Fate of other presidential aspirants Having declared, the development may have put to rest the ambitions of other presidential aspirants in the governing party who have tipped as the President’s replacement had he decided not to seek re-election. Those tipped to be nursing presidential ambition include: former Speaker, House of Representatives and Sokoto State Aminu Tambuwal; former Kano State Governor and Senator representing Kano Central, Rabiu Kwankwaso and Senate President Bukola Saraki. The development also comes at a time Buhari’s popularity has waned, following what most critics have attributed to his inability to fulfil his campaign promises. They buttress their argument with the massive PDP rally in Katsina State, chanting anti-Buhari slogan on a day the President was in his home state of Katsina. They recalled how former President Goodluck Jonathan and PDP officials were pelted with stones in Katsina State in the buildup to the 2015 polls. Mixed reactions trail announcement on social media Meanwhile, mixed reactions have trailed the President’s announcement on social media. While some commentators on the President’s Facebook page were opposed to his second term declaration, others expressed support for him. A Facebook user, Badung Joshua, argued that old age would limit the President’s performance, urging him to throw in the towel. His words: “For God’s sake, at what age do you want to still rule Nigeria without shame! For God’s sake, it’s in this same country, we are denied jobs at the age of 30 and above that we are too old to work in any government offices: “But the President in this same country is ruling at above 70 years! Tell me what brain, energy and leadership skill do you still have that those youths who are denied recruitments at all level do not have? “It’s only in this country that old men are preferred at the expense of the young. What a shame to an old man who can’t wilfully resign to allow fresh blood to impact!” Another user, Akintunde Temitope, said: “This can only happen in Nigeria whereby a man that has done nothing will want to contest again. You and I know that in a civilized clime, this inept man would have been impeached. What a disgraceful act, calamity will not befall us in 2019”. Also, Sunday Peters said: “Your report card doesn’t encourage running again, retire and rest. Give the youths a chance, you have tried your best unfortunately it wasn’t good enough for today’s Nigeria”. But other Facebook users expressed support for him. Commenting on the President’s post, announcing his decision to seek re-election, Fedeco Mammadi said: “I am ever willing to support you even with the few resources I have because I am confident that the future is secured with you”. Also, another user, George Oluwaniyi, said: “I was there for you in 2015. By God’s grace, I will be there for you again till 2019. Don’t mind those children of hate, Baba you are God sent”. Also, Ibrahim Margima Ishidi, said: “We the entire people of North East are happy by this noble intention, you should be rest assured that our votes for you is guaranteed!”.

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