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Category: Business

  • Subsidy: FG owes NNPCL N2.8trillion – Kyari

    Subsidy: FG owes NNPCL N2.8trillion – Kyari

    Mele Kyari, the Chief Executive of the Nigerian National Petroleum Company Limited (NNPCL), claimed on Tuesday that the federal government owes the company N2.8 trillion for fuel subsidy payments.

    After his meeting with President Bola Tinubu at the Presidential Villa in Abuja, Kyari revealed this to State House reporters.

    He affirmed that the subsidy is no longer viable because it prevents the company from having enough money to invest in its core businesses.

    The NNPCL CEO characterised President Tinubu’s announcement that subsidies are no longer available as belated and claimed that the reason for the resurgent gasoline lines is that marketers want to understand the significance of the president’s statement.

    He claimed that the remark’s uncertainty led to a rush on the product by customers, creating lines.

    The NNPCL CEO gave a guarantee that the government would take action to mitigate the effects of the subsidy’s removal.

    Faruk Ahmed, the Chief Executive of the Nigerian Mainstream and Downstream Regulatory Authority, stated that there will be no price cap on the sale of petroleum products in the nation once the subsidy has been eliminated.

    President Tinubu’s declaration regarding the elimination of subsidies in his inaugural address, according to Ahmed, was legal.

    In addition, he added, “the reality today is that government cannot afford it.” He stated that the Federal Government has not funded subsidies since 2022.

    Additionally, he noted that ongoing discussions were taking place and emphasised that “today, the country does not have money to pay for subsidy.”

  • Dangote Sugar Refinery Starts Year with Strong Earnings

    Dangote Sugar Refinery Starts Year with Strong Earnings

    The Dangote Sugar Refinery Plc began its fiscal year 2023 with a strong performance in its first quarter (Q1), demonstrating growth while maintaining its position as the industry’s undisputed leader.

    Following an increase in gross margin by 458 basis points year-on-year, the company’s quarterly unaudited financials for the first quarter of 2023, which were released on the Nigerian Exchange Limited, revealed a profit after tax growth of 44.3 percent year-on-year with earnings per share of N1.05 as compared to N0.73 in the first quarter of 2022.

    Increases in revenue across all of Dangote Sugar’s product lines contributed to the company’s 8.2% year-on-year revenue growth in the first quarter of 2023.

    The difference between the increase in revenue and the increase in the cost of sales resulted in an increase in the gross margin to 25.2%. Consequently, EBITDA margins increased by 407 basis points and EBIT margins increased by 437 basis points to reach 24.7 and 22.4 percent respectively in the quarter, despite an increase of 16.8 percentage points in operating expenses.

    Net finance costs increased by 103.2% year-on-year during the quarter as a result of a 129.9% year-on-year increase in finance costs in Q1, 2023, which rose to N8.06 billion from N3.51 billion in Q1, 2022. This increase occurred in conjunction with a 218.5% year-on-year growth in finance income.
    The overall profit before taxes in the first quarter of 2023 was N18.53 billion, representing an increase of 36.3% year-on-year. The cost of taxes in the first quarter of 2023 was N5.73 billion, which resulted in a profit after taxes of N12.80 billion, an increase of 44.3 percent.

    According to Cordros Securities Limited, Dangote Sugar’s performance in the first quarter of 2023 came in as expected, with significant growth in profitability during the period. According to the information provided in our full-year update for 2022, we are keeping our expectations that the favourable demographics for sugar consumption will continue to be positive for Dangote Sugar’s performance.

    Aliko Dangote, chairman of Dangote Sugar, made these remarks at the company’s Annual General Meeting: “The shareholders are very happy with the way we have been running their company and also in re-investing the profit into the Backward Integration Programme (BIP) for the sugar industry.”

    “We are going to do our part in ensuring that Nigeria becomes self-sufficient in sugar within a very short period of time by ensuring that we produce enough sugar for our own consumption. Although we are not the only players involved, you can count on us to play our part. We should be able to produce more than 170,000 tonnes, which would be the highest amount produced locally in Nigeria’s entire history by a significant margin.

    He made a commitment that the management would continue to implement strategic actions to maintain performance with the support of all stakeholders and in complete adherence to the tenets of the Sugar Master Plan that was developed by the federal government.
    Dangote stated that a portion of Dangote Sugar’s success could be attributed to the management’s continued implementation of the Dangote Sugar Development Master Plan. This included the rehabilitation and upgrade of the Dangote Sugar Refinery’s Numan operations, facilities, and land development. In addition, Dangote stated that the development of the Nasarawa Sugar Company Limited, the greenfield sugar project, and Tunga in Nasarawa State were all part of the plan.

    Dangote further stated that the first phase of the Sugar Master Plan implementation period came to an end during the year under review and that the federal government approved the second phase over the next 10 years, saying that this extension came on the back of the review of the first phase by the National Sugar Development Council and other government parastatals, taking cognizance of the challenges and several circumstances that were unforeseen which riddled the first phase of tumult. Dangote also stated that the federal government approved the second phase over the next

    Ravindra Singhvi, the Group Managing Director and Chief Executive Officer of Dangote Sugar Refinery stated that “implementation of the Sugar Projects initiatives continued at a high tempo despite the challenges.” However, we were able to maintain our victories by maintaining a peaceful environment with the communities and by maintaining a positive engagement with state and community stakeholders, as shown by the fact that they continued to support the DSR Backward Integrations Project.

    “The situation with the Lau/Tau project is still the same, and we are hopeful that the Taraba State Government will resolve the community issues, focus on the development, rehabilitation, and upgrade of our facilities at the Dangote Sugar Refinery, Numan Operations, and the Nasarawa Sugar Company Limited, Tunga,” said the company. “The Dangote Sugar Refinery is located in Tunga.”

    He said that “steady progress is now being made as the Company continues the rehabilitation and expansion project at Dangote Sugar, Numan, and development activities at the Nasarawa Sugar Company Limited, Tunga,” and he added that “the Board and Management remain resolute and committed to ensuring a sustainable future for the business with the Dangote Sugar Master Plan.” He said that “steady progress is now being made as the Company continues the rehabilitation and expansion project at Dangote Sugar, Numan,” and that ”

    When asked about the company’s outlook for the future, the CEO responded as follows: “we will continue to strategically position our brand, optimise our processes and cost efficiency, and implement our strategic initiatives, including the Sugar for Nigeria Backward Integration Project Master Plan.”

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    “This has been pursued with rigour, and the realization of the targets will ensure the growth of Dangote Sugar into an integrated sugar production business and a sustainable future for the business,” says the company.

    Also, the Group chief finance officer of Dangote Sugar Refinery, Oscar Mbeche, stated that “in 2022, the company recorded another impressive year of financial performance and achieved growth over 2021 financial performance.” Oscar Mbeche said this. The increase in revenue in 2022 was 46 percent higher than in 2021, going from N276.1 billion to N403.2 billion. This was due to the fact that sales volume increased by 10 percent while prices also increased.

    “The company continued to grow its supply chain footprint in Nigeria, which was complimented by excellent customer care that maintained customer loyalty, which in turn sustained the company’s revenue growth.” The provision of high-quality sugar to the company’s clients continues to be the primary concentration of the business.

    Mbeche explained that DSR has continued to support the development of the Nigerian Sugar Master Plan and that DSR’s backward integration (BIP) Numan operations saw the highest volumes of sugar processed since the inception of the company, increasing by 64 percent over 2021 volume. This was stated in reference to the performance of the Nigeria Sugar Master Plan and the BIP.

    He did note, however, that a number of significant obstacles must still be conquered. These include, among other things, the difficulties of securing funds to import capital assets to support BIP development plans and inadequate infrastructure. He noted that all of these factors have a negative impact on the rate at which DSR can achieve further financial and performance efficiencies in the BIP operations.

    With its production of Vitamin A Fortified and non-fortified refined granulated free flowing crystal white sugar, packaged and distributed in 1000kg, 50kg bags, 1kg, 500g, and 250g; sold under the brand name ‘Dangote Sugar’ sold to consumers and industrial markets nationwide, Dangote Sugar controls more than 60 percent of the local market share.

  • CBN adds 7,552 BVN to watchlist as eNaira transactions reach 1.4m

    CBN adds 7,552 BVN to watchlist as eNaira transactions reach 1.4m

    The Central Bank of Nigeria (CBN) has placed 7,552 Bank Verification Numbers (BVN) on its watchlist in case they are used in fraudulent transactions. This comes at the same time as the Central Bank Digital Currency (CBDC), also known as eNaira, has recorded 1.4 million transactions to date, which represents an increase of 100 percent compared to the 700,000 transactions that were recorded in November 2022.

    In a similar vein, Nigeria is transitioning towards cashless and other contactless payment options, such as QR Codes and NFC, amongst others, for the purpose of facilitating seamless financial transactions throughout the country.

    Yesterday, in Calabar, Cross River State, at the 34th Finance Correspondents and Business Editors seminar, the topic of discussion was “Implementing a Robust Payment Architecture Prospects, Opportunities, and Challenges.” The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, stated that the Nigeria payment system landscape has continued to record significant changes and development.

    Emefiele, who was represented by Dr. Hassan Mahmud, the director of Monetary Policy, stated that since the launch of eNaira, the central bank has continued to modify the features of the digital currency in order to make it more accessible to a wider variety of users.

    “In today’s day and age, one does not require a smartphone in order to use the eNaira because it has become compatible with all generations of mobile devices (both new and old).” Over 1.4 million transactions have been completed using the eNaira platform to this day,” he added.

    He emphasised that the apex bank took advantage of the opportunity by launching the eNaira in October 2021, saying that the introduction of COVID-19 without a doubt triggered rapid advancements in financial technology, leading to speedy digitisation of money and finance. He said this was the case.
    It was noted by him that the eNaira was developed to expand the payment options available to Nigerians and to foster digital financial inclusion. Additionally, it has the potential to speed up both intergovernmental and social transfers.

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    The governor of the Central Bank of Nigeria (CBN) also disclosed that the total enrolment of BVN users as of March 31, 2023 stood at 57.43 million. He added that the BVN has also assisted the industry in investigating fraud and other crimes associated with the sector.

    “The BVN is providing assistance in the creation of credit profiles for banking customers, which will assist in the improvement of access to credit for credit-worthy borrowers provided by financial institutions. The BVN has continued to play an important role in our Know Your Customer (KYC) requirements as a component of our plans to alleviate the burden associated with improper identification of banking customers. He was quick to point out that “we have continued to support the aggressive enrolment of prospective banking customers in the informal sector onto the BVN system.”

    Emefiele made note of the fact that cyber threats and the fraudulent activities of fraudsters continue to threaten the resiliency of payment platforms, and that the confidence of the general public is negatively impacted as a result of these activities. He revealed that there is a concerted effort being made by the Central Bank of Nigeria and other players in the industry to put a stop to the nefarious activities that are being carried out by these fraudsters.

    According to him, “in response to the challenges posed by cyber threats, the CBN is addressing these hiccups with the Nigeria Electronic Fraud Forum (NeFF), the payment card industry data security standard, the financial industry cybersecurity fusion centre, and other initiatives against cybersecurity and fraud in Nigeria.”

    He stated that in order to achieve minimal cybersecurity threats in the payments system, the bank will also continue to adopt a collaborative approach and then made the following promise: “a holistic mechanism for addressing cybersecurity threats requires policy and operational actions by all stakeholders.”

    “As you are aware, the Bank will be implementing a Risk-Based Cyber-Security Framework and Guidelines for Other Financial Institutions beginning January 2023. This will ensure that these institutions are able to maintain their operational resilience in the face of cyber-security threats.

    In his paper, the director of Payment Systems Management at the CBN, Musa Jimoh, who was represented by the deputy director of Payment Systems, Adefuye Adeyemi, revealed that there are 7,552 people on the BVN watchlist for fraudulently related transactions.

    According to him, the CBN is now able to track fraudulent individuals and entities thanks to the centralisation of the BVN. These individuals and entities are said to have engaged in fraudulent activities such as forgery, compromise, complicity, fraudulent duplicate enrolment, and any other fraudulent infraction with or without a monetary value.

    Speaking further on the cardless and other contactless payment options, he said that the banking industry is quickly evolving towards cardless and other contactless payment options, and he added that the regulator has issued robust regulations to standardise the operations of contactless payments in Nigeria. He was referring to the fact that the cardless and other contactless payment options are becoming increasingly popular.

    It is an innovative payment option for the safe and efficient conduct of low-value, large-volume payments, as he pointed out, and contactless payments allow for financial transactions to be completed without the need for any physical contact between the payer and the devices that are acquiring the payments.

    He emphasised that this, in addition to other payment initiatives, has helped open a vista of new opportunities in the payment ecosystem. He said that as a result of these ground-breaking technological advancements, the market has witnessed the deployment of new payment solutions.

    “Artificial intelligence, quantum computing, and contactless payment systems are just a few of the areas that are creating new opportunities for operators. He emphasised that the Payments System Vision (PSV) 2025 contains several recommendations that are aimed at driving implementation of some of the most recent technologies to ensure the system’s resilience and safety. This document was just recently launched.

    He emphasised that the Nigerian payments and financial services sector is ranked among the best in terms of innovation, regulation, and resilience. He also noted that in order to maintain the successes that have been achieved, it is essential to have the support of all of the financial institutions and stakeholders.

    In this regard, he stated that the Central Bank of Nigeria (CBN) is prepared to continue to strengthen the institutional and regulatory frameworks that would encourage further development of the payments system and promote the usage of secure and credible electronic products in accordance with the PSV 2025 strategic plan.

  • Zenith Bank pleases shareholders by paying N100.47bn dividend

    Zenith Bank pleases shareholders by paying N100.47bn dividend

    Shareholders of Zenith Bank Plc have voted unanimously in favour of the company’s proposal to pay a final dividend of NGN2.90 per share. As a result, the total dividend for the fiscal year 2022 will amount to NGN3.20 per share, with a total value of NGN100.47 billion.

    At the Bank’s 32nd Annual General Meeting (AGM), which took place yesterday virtually in Lagos, approval was given for the payment of dividends.

    Jim Ovia, the founder and chairman of the bank, expressed his gratitude to the shareholders for their unwavering loyalty, commitment, and support, all of which have been essential in the bank’s outstanding performance ever since it was established. This expression of gratitude was made during the opening statement of the annual general meeting (AGM).

    Dr. Ebenezer Onyeagwu, group managing director and chief executive, paid tribute to the bank’s founder and chairman, praising them for laying the foundation for the institution’s legacy and laying the groundwork for its ongoing superior performance.

    In addition to this, he emphasised the Board of Directors’ and Management’s determination to keep the bank on its current growth trajectory in the years to come, with a particular focus on retail and digital banking.

    Also speaking was Dr. Faruk Umar, president of the Association of the Rights of Nigerian Shareholders (AARNS), who complimented the Board of Directors and Management of Zenith Bank for consistently delivering value to shareholders despite the challenging economic environment. In addition, he lauded the employees of the bank for their steadfastness and commitment.
    In a similar vein, Chief Timothy Adesiyan, president of the Shareholders Solidarity Association of Nigeria, expressed delight at the dividend payout and thanked the Board of Directors and Management for the outstanding performance that led to the approval of both an interim and final dividend during the course of the year. This is in the same vein as the previous sentence.

    Also speaking was the national coordinator of the Esteemed Shareholders Association of Nigeria, Mrs. Adenike David. She extended her congratulations to both the bank and the Chairman on their performance, which was demonstrated by the numerous awards they received during the 2022 fiscal year. Additionally, she lauded the financial institution for its payment of an interim dividend in the amount of 30 kobo and a final dividend in the amount of 2.90 kobo.
    In spite of difficult macroeconomic conditions, Zenith Bank Group was able to increase its gross earnings by 24 percent, from NGN765.6 billion in the previous year to NGN945.5 billion in 2022. This represents an increase from the previous year’s figure of NGN765.6 billion. This was primarily due to a growth in non-interest income of 23 percent year over year and a growth in interest income of 26 percent year over year. The trust placed in the bank by its customers is reflected in the growth of the bank’s customer deposits, which increased by 39%. The elevated yield environment had a positive impact, causing the Net-Interest-Margin (NIM) to increase from 6.7 percent to 7.2 percent. Although they increased by 17% year over year, operating expenses are still lower than the rate of inflation. The growth in deposits from customers was the primary contributor to the 30% increase in total assets.

    In 2023, Zenith Bank Group intends to broaden its scope of operations and reorganise into a holding company structure. Additionally, the company intends to add new verticals to its businesses and pursue growth in all selected markets, both domestically and internationally.

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    The track record of excellent performances that Zenith Bank has maintained has continued to earn the brand numerous awards. These awards include being recognised as the Number One Bank in Nigeria by Tier-1 Capital, for the 13th consecutive year, in the 2022 Top 1000 World Banks Ranking published by The Banker Magazine; Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020 and 2022; Best Bank in Nigeria, for three consecutive years from 2020 to 2022, in the Global Finance Awards. World’s Best Banks Awards; Best Commercial Bank, Nigeria 2021 and 2022 in the World Finance Banking Awards; Best Corporate Governance Bank, Nigeria in the World Finance Corporate Governance Awards 2022; Best in Corporate Governance’ Financial Services’ Africa, for three consecutive years from 2020 to 2022, by the Ethical Boardroom; Best Commercial Bank, Nigeria and Best Innovation In Retail Banking, Nigeria in the International Banker 2022 Banking Awards; and Best Corporate Governance Bank, Nigeria in the World’s Best Banks Awards. In addition to this, the bank was awarded the title of Most Valuable Banking Brand in Nigeria by Banker Magazine’s Top 500 Banking Brands for both 2020 and 2021. Furthermore, the bank was named Retail Bank of the Year by BusinessDay Banks and Other Financial Institutions (BAFI) Awards for three years in a row, beginning in 2020 and continuing until 2022. In a similar vein, Zenith Bank was recognised as Bank of the Decade (People’s Choice) at the ThisDay Awards 2020, Most Innovative Bank of the Year 2019 by Tribune Newspaper, Bank of the Year 2020 by Independent Newspaper, Bank of the Year 2021 by Champion Newspaper, Bank of the Year 2022 by New Telegraph Newspaper, and Most Responsible Organisation in Africa 2021 by SERAS Awards. In addition, Zenith Bank was awarded the title of Most Responsible Organisation in Africa 2021 by SERAS Awards.

  • Adeyeye warns that Indomie Instant Noodles ‘Special Chicken Flavour’ not approved by NAFDAC

    Adeyeye warns that Indomie Instant Noodles ‘Special Chicken Flavour’ not approved by NAFDAC

    The National Agency for Food and Drug Administration and Control (NAFDAC) has issued a warning that the implicated Indomie Instant Noodles ‘Special Chicken Flavour’ is not registered for sale in Nigeria by NAFDAC.

    Prof Mojisola Christianah Adeyeye, Director General of NAFDAC, made the announcement on Tuesday in Abuja.

    Adeyeye recalled that the Ministries of Health in Malaysia and Taiwan had banned Indomie Instant Noodles ‘Special Chicken Flavour’ due to the alleged presence of ethylene oxide, a compound linked to an increased risk of cancer.

    As a result, she warned the general public that the product had not yet been registered by NAFDAC.

    “The Management of the National Agency for Food and Drug Administration and Control (NAFDAC) is aware of the recalls of Indomie Instant Noodles ‘Special Chicken Flavour’ by Malaysian and Taiwanese Ministries of Health due to the alleged presence of ethylene oxide, a compound associated with an increased risk of cancer,” she said.

    “NAFDAC, as a responsible and responsive regulator, is moving quickly to conduct random sampling and analysis of Indomie noodles (including seasoning) for the presence of ethylene oxide, as well as expanding the investigation to other brands of instant noodles sold in Nigeria.”

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    “We use this medium to reassure the public that thorough investigations of the products will be conducted at both the factory and market levels, and our findings will be communicated.”

    “The public is also hereby informed that the implicated Indomie Instant Noodles ‘Special Chicken Flavour’ is not registered for sale in Nigeria by NAFDAC,” she added. It is important to note that noodles are on the Federal Government of Nigeria’s Import Prohibition List and thus are not permitted for importation into Nigeria.

    “Furthermore, the Indomie instant noodles (and other brands of noodles) registered by NAFDAC for sale in the Nigerian market are manufactured in Nigeria and are only granted NAFDAC registration status after passing a stringent regulatory regime covering all aspects of Good Manufacturing Practice (GMP).” The Ports Inspection Directorate (PID) is also on high alert to prevent the implicated product from being imported into Nigeria.

    “NAFDAC wishes to reassure the public that the Agency is proactive and committed to its responsibilities of protecting the public’s health.”