2018 2018 THIRD QUARTER THIRD QUARTER PRESENTATION TO PRESENTATION TO INVESTORS & ANALYSTS INVESTORS & ANALYSTS
O UTLINE Section Page 03 1 Africa Prudential Overview 07 2 Operating Environment 09 3 Financial Overview 4 2018 Outlook 14 5 Appendix 16 Page|2
1 A FRICA P RUDENTIAL O VERVIEW
F UNDAMENTAL S TATISTICS Total revenue: N2.58billion, 1 compared to N2.27billion in Q3 2017 (14% YoY growth). Africa Prudential is strategically located Profit Before Tax: in the commercial N1.62billion, an impressive capital of Nigeria, 11% YoY growth compared Lagos ; the political to Q3 2017. capital, Abuja ; and Port-Harcourt. Diversified business First and only registrar lines broadening firm listed on the 2 4 revenue streams Nigerian Stock Exchange N Over 70 Shareholders Fund of N7.43billion ,higher Clients The top management of by 7% YTD the Company have a track record of providing Ranked No. 1 in Manages 83 client registrar as well as allied technology and registers, made up of services to the Nigerian innovation among over 3million Money and Capital corporate registrars shareholders 3 Markets. Page|4
O UR J OURNEY S O F AR … A The Company’s name changed to UBA Registrar No computerization Africa Prudential Registrar in 2013 Department was (transactions were created in 1970 done manually) Projected gross earnings of N10billion Clients increased to over 70 Asset book of over Implementation of Strategic Business Accounts/clients N1.4billion with Segmentation increased from 15 Asset book increased to N18billion while N63.4million gross to 17 gross earnings increased to N3.3billion earnings Phase Phase Phase 1 2 3 1A: 1970 – 2006 & 1B: 2006 - 2012 2013 - 2017 2018 - 2025 Total Separation of registrar business UBA Registrar was Innovation and APR was listed in January 2013 incorporated in capacity building Total Separation of E-Solutions 2006 commenced Business Number of shareholders increased to over 280,000 shareholders Gross earnings rose Entrance into the African market Accounts/Clients to N1.9billion and increased from 17 Acquisition of UAC Registrars Limited asset book rose to to 50 with 4 clients base N14.1billion B The Company’s name changed to Africa Prudential Plc in 2017 Page|5
O UR S TRATEGY Africa Prudential 1 2 3 Registrar Business E-Solutions Business African Market Africa Prudential would play in three major areas which includes: Registrar business E-solution Business African Market Each business area would be led by a “Business Lead” and would run as a separate business Page|6
2 O PERATING E NVIRONMENT
O PERATING E NVIRONMENT B2 2.9% 11.28% N360/$ 14% Credit Rating Inflation Rate GDP Growth Exchange Rate *Moody’s; as at Nov Rate Interest Rate *As at Sept 2018 2017 *As at June 2018 *As at Sept 2018 13.31% *BDC; as at Sept 2018 $45.9bn $78.89 22.5% 145 th Food Inflation Foreign (Dollars per barrel) Rate Exchange Cash Reserve Crude Oil Reserves Ease of Doing Ratio (Brent Crude) Business *As at Sep 2018 *As at Sept 2018 *As at Sept 2018 *As at Dec 2017 *As at Sept 2018 Source: Trading Economics Page|8
3 F INANCIAL O VERVIEW
Q3 2018 R ESULTS S NAPSHOT Financial Metric (N' Billion) Q3 2018 Q3 2017 Change Revenue 2.58 2.27 +14% Operating Expenses (0.97) (0.75) +28% Profit Before Taxation 1.62 1.45 +11% Profit After Taxation 1.35 1.31 +3% EPS (Kobo) 67 65 +3% Financial Metric (N' Billion) Q3 2018 FY 2017 Change Total Assets 18.81 21.93 -14% Total Liabilities 11.38 14.99 -24% Total Equity 7.43 6.94 +7% Page|10
…I NCREASING E ARNINGS Breakdown of Earnings(%) Gross Earnings (N'billion) Fee Income Investment Income 2.58 2.27 1.75 1.53 59% 64% 66% 71% 41% 36% 34% 29% Q3 2015 Q3 2016 Q3 2017 Q3 2018 Q3 2015 Q3 2016 Q3 2017 Q3 2018 Operating Expenses (N'billion) Over the last 4 years (Q3), Africa Prudential grew gross earnings by 14% CAGR, leveraging on innovation, technology and efficient management of investment activities. 0.97 Fee Income grew by an impressive 43% year on year in Q3 2018, driven by 0.75 increase in number of customers serviced. 0.56 0.57 Also, Net Investment Income contributed 64% of Gross Earnings, driven largely by efficient management of investment activities. Operational Expenses increased by 28% year on year. This was largely due to technological advancement, business expansion, product development and recruitment. Q3 2015 Q3 2016 Q3 2017 Q3 2018 Page|11
S TRONG P ROFITABILITY Profit Before Tax (N'billion) Profit After Tax (N’billion) 1.62 1.45 1.35 1.19 1.31 0.93 1.08 0.82 Q3 2015 Q3 2016 Q3 2017 Q3 2018 Q3 2015 Q3 2016 Q3 2017 Q3 2018 Profit Margin(N’billion) 62% Profit Before Tax grew 11% CAGR over the last 4 years representing a strong momentum in terms of profitability. 58% The Company recorded a 3% year on year growth in Profit After Tax to 54% N1.35billion, representing the highest profit in the 4-year period. 52% The Company’s Profit Margin stood at 52% and delivered an EPS of 67 kobo. Q3 2015 Q3 2016 Q3 2017 Q3 2018 Page|12
B ALANCE S HEET S NAPSHOT Total Assets (N’billion) Total Liabilities (N’billion) 14.99 21.93 13.12 12.27 18.81 17.7 11.38 16.8 FY 2015 FY 2016 FY 2017 Q3 2018 FY 2015 FY 2016 FY 2017 Q3 2018 Shareholder’s Fund (N’billion) 7.43 6.94 The Company’s Total Assets declined by 14% YTD, largely due to reduction in cash 4.57 4.55 Total Shareholders Funds grew 7% YTD The Company’s Total Liability declined by 24% YTD. FY 2015 FY 2016 FY 2017 Q3 2018 Page|13
4 2018 O UTLOOK & K EY T AKEAWAY
2018 O UTLOOK Q3 2018 Actual 2018 Guidance % of Guidance 1 Gross Earnings N2.58Bn N3.8Bn 68% 2 Professional Fee Income N0.94Bn N1.3Bn 72% 3 Net Investment Income N1.64Bn N2.3Bn 71% 4 Operating Expense N0.97Bn N1.4Bn 69% 5 Profit Margin 52% 55% 95% 6 Return On Equity 25% 32% 78% 7 Return On Assets 9% 9% 100% Page|15
5 A PPENDIX
A BOUT A FRIPRUD - A CTIVITIES & A WARDS Phase One A: (1970 - Phase One B: (2006 - 2013) Phase Two: (2014 - 2017) 2005) First registrar portal developed in 2008 The Company was listed on the Nigerian Stock Exchange in First registrar company January 2013 Most profitable subsidiary of UBA group in 2009 to pay e-dividend 1 billion share right issue (over subscribed by 125%) Engaged in debt recovery, process review/reengineering as well as brand Commencement of Blue Ocean Strategy as well as market resuscitation focus on the Cooperative Sector Created a Strategic Business Transformation Setting up the structure for business segmentation (Registrars, Department E-Solution and Africa Focus) International Quality Crown Award 2013 Best Profit Margin Ratio Company - PEARL Award 2015 Best Top 25 CEOs Award 2013 Best Corporate Governance Company in Nigeria, PEARL Award 2015 Best Registrar Firm in West Africa - 2017, Africa-Canada Trade Alliance, West Africa Innovation and Excellence Awards Robust Internal Control mechanism and Corporate Governance structure that support operations Page|17
A BOUT A FRIPRUD - A SPIRATIONS Over the next 7 years, Africa Prudential is poised to be No.1 in Nigeria, with an aspiration to expand into the African market, driven by technology and reinforced by a strong capital base. Implementation of Strategic Total Separation of Registrar Business Segmentation Business #1 In Nigeria Total Separation of E-Solutions Entry Into the African Market Business To Penetrate Other African Markets Market Leader with Technology Sustain Strong Capital Base And Innovation Page|18
A FRIPRUD & T ECHNOLOGY 01 Information Technology Easy Access 02 User Friendly 03 Easy Access Information Technology Our platforms can be easily accessed through various IT is the bedrock of our digital aspirations and innovation. devices such as laptops, smartphones etc. Our track record of being first in innovative products is Our simplified USSD code also provides easy access to driven by our belief that IT is key to our survival as a our various products. company. User Friendly Our technology has been designed to be highly user friendly with an interface that enables our clients to have the best experience. Page|19
I NCOME S TATEMENT In thousands of Nigerian Naira 30-Sep-18 30-Sep-17 Registrars fee income 941,348 659,860 Net investment income 1,640,901 1,611,161 Gross earnings 2,582,249 2,271,021 Other income 79,690 35,433 Impairment loss on financial assets (74,042) (100,000) Personnel expenses (456,556) (292,984) Other operating expenses (456,556) (424,667) Depreciation and amortization (55,390) (36,079) Finance charges - - Profit before tax 1,619,395 1,452,724 Income tax expense (273,737) (144,100) Profit after tax 1,345,658 1,308,624 Other Comprehensive Income, net of income tax Items that will not be reclassified subsequently to profit or loss: - - Items that may be reclassified subsequently to profit or loss: Fair value gain on quoted equity (52,434) 112,054 Fair value gain/(loss) on unquoted equity - - Total comprehensive income 1,293,224 1,420,678 Basic earnings per share (kobo) 67 65 Page|20
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