Equities Market Declines Further as Investors Ignore Companies’ Results

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Goddy Egene

The Nigerian equities market witnessed further decline yesterday as investors appeared to be ignoring the 2018 financial results of companies. The market had shed 1.2 per cent in the first quarter of 2019 majorly due to political risks. Stakeholders have been hoping that the reduced political tension after the general elections and release of corporate results including declaration of dividends would lead to recovery. However, the market remained bearish and has shed 2.6 per cent in the first two days of the second quarter.

The Nigerian Stock Exchange (NSE) All-Share Index (ASI) went down by 0.99 per cent yesterday to close at 30,226.70 as 28 stocks declined. The market capitalisation shed N169 billion to be at N11.4 trillion. The decline was propelled by losses suffered by Nigerian Breweries Plc, Nestle Nigeria Plc and Unilever Nigeria Plc. The three firms have released their results and declared dividends. Nestle Nigeria , for instance, delighted investors with improved bottom-line and higher dividend.

The company reported a revenue of N266.27 billion, showing an increase of 9.0 per cent compared with N244.1 billion posted in 2017. Net finance cost dipped by 89.9 per cent from N8.869 billion to N889 million last year. As a result, profit before tax (PBT) improved by 27.5 per cent from N46.83 billion in 2017 to N59.75 billion, while profit after tax (PAT) grew from N33.72 billion to N43 billion in 2018.

The board directors recommended a final dividend of N38.50 per share and having paid an interim dividend of N20 per share before now, the total dividend for the 2018 would be N58.50 per share. This shows an increase of 37 per cent compared with N42.50 paid in 2017.

But the stock fell 3.5 per cent to close at N1, 400 per share yesterday. However, Beta Glass Plc and Forte Oil Plc led the price Losers’ table with 9.9 per cent apiece, trailed by Vitafoam Nigeria Plc with 9.6 per cent.

Oando Plc, which announced a growth of 46 per cent on Monday, was also among the price losers, going down by 7.8 per cent.

The integrated energy firm recorded a turnover of N679 billion, indicating a growth of 37 per cent from N497.4 billion in 2017. Profit after tax rose by 46 per cent from N19.8 billion to N28.8 billion in 2018.