A N I MPRESSIVE S TART : 2018 F IRST Q UARTER R ESULTS P RESENTATION TO I NVESTORS & A NALYSTS
O UTLINE Section Page 1. Africa Prudential Overview 02 2. Domestic Operating Environment 09 3. Financial Overview 12 4. 2018 Outlook 18 5. Appendix 21 Page|1
1 A FRICA P RUDENTIAL O VERVIEW Page|2
F UNDAMENTAL S TATISTICS A FRICA P RUDENTIAL Total revenue : N1.01billion, compared to N0.65billion in Q1 2017 (55% YoY growth). Africa Prudential is strategically located Profit After Tax : N0.46billion, in the commercial an impressive 22% YoY capital of Nigeria, growth compared to Lagos ; the political Q12017 capital, Abuja ; and Port-Harcourt. Diversified business lines First and only registrar firm listed 2 4 broadening revenue streams on the Nigerian Stock Exchange N AFRIPRUD 70 Over Shareholders Fund of N6.64billion , lower 3 The top management of by 4% YTD; largely the Company have a due to increase in Clients track record of providing dividend paid registrar as well as allied services to the Nigerian First among corporate registrars Manages over 70 client registers, Money and Capital for its technological innovations made up of over 3 million shareholders Markets. Page|3
O UR J OURNEY S O F AR … A No The Company’s name changed to UBA Registrar computerization Africa Prudential Registrar in 2013 Department was (transactions were created in 1970 done manually) • Projected gross earnings of Clients increased to over 70 N10billion Asset book of over Accounts/clients • Implementation of Strategic N1.4billion with Asset book increased to N18billion increased from 15 Business Segmentation N63.4million gross while gross earnings increased to to 17 earnings N3.3billion Phase Phase Phase 1 2 3 1A: 1970 – 2006 & 1B: 2006 - 2012 2013 - 2017 2018 - 2025 UBA Registrar was Innovation and APR was listed in January 2013 • Total Separation of registrar incorporated in capacity building business 2006 commenced • Total Separation of E-Solutions Number of shareholders increased to Business over 280,000 shareholders • Entrance into the African market Gross earnings Accounts/Clients rose to N1.9billion increased from 17 Acquisition of UAC Registrars Limited and asset book to 50 with 4 clients base rose to N14.1billion B The Company’s name changed to Africa Prudential Plc in 2017 Page|4
O UR S TRATEGY Africa Prudential 1 2 3 Registrar Business E-Solutions Business African Market Africa Prudential would play in three major markets which includes: • ― Registrar business ― E-solution Business ― African Market Each business areas would be led by a “Business Lead” and would run as a separate business • Page|5
O UR A SPIRATIONS Over the next 7 years, Africa Prudential is poised to be #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|6
K EY A CTIVITIES A ND A WARDS Phase One A: (1970 - Phase One A: (1970 - 2006) Phase Two: (2014 - 2017) Phase Two: (2013 - 2017) Phase One B: (2006 - 2013) 2005) ✓ First registrar portal developed in 2008 The Company was listed on the Nigerian Stock Exchange in ✓ ✓ First registrar company January 2013 to pay e-dividend ✓ Most profitable subsidiary of UBA group in 2009 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|7
D RIVEN B Y T ECHNOLOGY 01 Information Technology Easy Access 02 User Friendly 03 Information Technology IT is the bedrock of our digital aspirations and Easy Access • innovation. Our platforms can be easily accessed through various • Our track record of being first in innovative products is devices such as laptops, smartphones etc. • driven by our belief that IT is key to our survival as a Our simplified USSD code also provides easy access to our • company. various products. 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|8
2 O PERATING E NVIRONMENT Page|9
O PERATING E NVIRONMENT THE DOMESTIC ECONOMY REGULATORY ENVIRONMENT The Nigerian economy finally exited recession by Q2 of 2017 after 5 • The Securities and Exchange Commission (SEC) has directed the • consecutive quarters of contractions. stoppage of dividend warrant issuance effective 1st January 2018. The recovery was driven largely by growth in international crude oil • Furthermore, SEC also announced the extension of free e-dividend • prices which traded at an all-time high of US$52.4 per barrel by close of mandate registration window to 28th February 2018. Consequently, e- 31st December 2017 and growth of the agricultural, manufacturing dividend mandate enrolment after 28th February 2018 will attract a and trade sectors. fee. Inflation dropped by 282 basis points from 15.13% in January to 13.34% • The Commission also hinted on plans to commence enforcement of • in March 2018. The exchange rate also stabilized, with the Naira electronic transmission of annual reports. The pilot scheme exchanging for the US Dollar at an average of N360/USD. commenced in 2017. In line with the Commission’s directive on mandatory consolidation of • CAPITAL MARKETS multiple shareholding accounts, the Commission further extended the forbearance window for multiple accounts consolidation to 31st March The Nigerian capital market witnessed gradual recovery from its • 2018 to enable shareholders with such accounts in the same company bearish trend which persisted for the first 6 months of 2017 with investors on the Nigerian Stock Exchange(NSE) gaining around N4.3 trillion by to consolidate the accounts. end of 2017 as capitalization grew by 47%. SEC has also mandated all investors to key into the Direct Cash • This was influenced by improved half year reports of some major stocks Settlement (DCS) initiative effective 1st September 2017. The DCS • and increased foreign portfolio investment. initiative allows proceeds of shares sold to settle directly into an investor’s account as against through the broker’s account. Throughout the year, there was no new public offer for subscription. • But in a show of a positive sign of gradual recovery, towards the last • quarter of 2017, the market witnessed a respectable number of Rights Issues which were all remarkably successful. Page|10
O PERATING E NVIRONMENT C ONT ’ D Monetary policy – Interest Rate Exchange Rate Inflation Rate ▪ At all the MPC meetings held from ▪ The introduction of the Investor and ▪ Headline inflation moderated for the 11th January 2017 to April 2018, the MPC Exporters (I&E) Window has stimulated consecutive month to 13.34% in March decided to retain all monetary policy foreign currency inflows, and moderated 2018 as it continues to ease. The inflation instruments at their current levels; MPR at the pressure on the Naira. Whist the FX rate was 15.13% in January 2018. 14.0%, MPR Corridor at -500bps and market remains fragmented, liquidity has +200bps, CRR at 22.5% and Liquidity Ratio improved and rates at the parallel market ▪ Food inflation remains drops to 16.08% at 30.0%. and I&E Window have converged around from 18.92% in January, due partly to the N360/USD. increase in security across Nigeria. ▪ Fixed income yields moderated slightly but remained elevated as a result of the ▪ Most market participants, including ▪ Core inflation has however been continued tight monetary policy portfolio flows, payments for services, relatively subtle, reaching its lowest at environment during the period. dividend payments as well as demand for 11.2% in March 2017, as improved foreign the import of finished goods continue to currency liquidity moderates the rise in transact in the window. non-food consumer good prices. Page|11
3 F INANCIAL O VERVIEW Page|12
2018 F IRST Q UARTER R ESULT S NAPSHOT Financial Metric Q1 2018 Q1 2017 Change (N' Billion) Turnover 1.01 0.65 +55% Operating Expenses (0.46) (0.25) +89% Profit Before Taxation 0.54 0.40 +35% Profit After Taxation 0.46 0.38 +22% EPS (Kobo) 23 19 +21% Total Assets 22.66 21.93 +3% Total Liabilities 16.01 14.99 +7% Total Equity 6.64 6.94 -4% Page|13
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