Omodele Adigun
Many people were caught off guard when Africa Prudential Registrars Plc, not long ago, suddenly metamorphosed into a new entity.
Accordiing to its Managing Director/CEO, Mr Obong Idiong, the reason for this change is to give more returns to its shareholders.
“In furtherance of the previous approval of change of name from Africa Prudential Registrars Plc to its current name, a cardinal reason is the diversification strategy for the company to bring more and sustainable value to shareholders.
“We will continue to explore new innovative ways to deliver superior value and experience to our clients, while leveraging technology to drive greater cost efficiency in our operations.,” he stated.
At the company’s Annual General Meeting recently in Lagos, Idiong told the shareholders what the current management of the company is up to in its transformational agenda.
Excerpts
The company
I replaced the company’s longest serving MD/CEO, Mr Peter Ashade, who retired after 12 meritorious years of service. He was instrumental to the transformation of the company from a unit bank registrar department to a listed company on NSE, pioneering many innovative products in the capita l market and culminating in many local and international recognitions. I replaced Ashade in July 2018 as Managing Director/CEO with the task of building on his successes to evolve a more diversified, more viable and more profitable Africa Prudential Plc. I can assure our esteemed shareholders of my commitment to delivering on this all-important mandate while offering increasing returns on investment to them.
Capital market
Bearish sentiments dominated the Nigerian Stock Exchange (NSE) in 2018, having emerged as one of the top three best performers in 2017. Equity investors on the Exchange lost N1.89 trillion in investment owing to sell pressure induced by rising rates in developed countries and heightened uncertainty as the general elections were approaching.
There was no initial Public Offering (IPO) on the NSE in 2018 as the much-anticipated listing by MTN was delayed. However, the market recorded eight new listings from quoted companies during the course of the year. The cumulative transactions from January to December on the NSE reduced by 5.44 per cent from N2.542 trillion recorded in 2017 to N2.404 trillion in 2018. Total foreign investment inflow on the NSE declined by 25.3 per cent from N772.25 billion in 2017 to N576.45 billion in 2018.Total foreign investment outflow increased by 47.6 per cent from N435.31 billion in 2017 to N642.65 billion in 2018. Net foreign investment in 2018 was a deficit of N66.2 billion.
Financials
Gross earnings for the period under review grew by 35 per cent from N3.31 billion in 2017 to N4.48 billion in 2018 due to growth in professional fee income, subscription income for our solutions and investment income. Operating profit for the period grew by 50 per cent from N2.19billion in 2017 to N3.29 billion in 2018. Profit before tax grew by 16 per cent from N2.06 billion in 2017 to N2.39 billion in 2018, while profit after tax grew by 14 per cent from N1.71 billion in 2017 to N1.95 billion. Also basic and diluted earnings per share grew by 14 per cent from 86 kobo in 2017 to 98 kobo in 2018.
We will continue to explore new innovative ways to deliver superior value and experience to our clients, while leveraging technology to drive greater cost efficiency in our operations. While the company’s balance sheet size reduced slightly by 3 per cent during the period under review, retained earnings and shareholders’ fund grew by 21 per cent and 24 per cent respectively. We remain undaunted in our commitment to protecting and growing the wealth of our shareholders while offering competitive returns on investment.
Share performance
Despite the bearish trend occasioned by massive sell offs in the Nigerian capital market in 2018, the company’s share was able to outperform the NSE market capitalisation, which declined by 13.9 per cent as against 10 per cent of the company. Similarly, the company’s shares attained its highest value on February 26 , 2018 at N5.19, while it attained its lowest value on December 14, 2018, closing at N3.51 even as a total of 538,350,547 units of the company’s shares valued at N2.3 billion was traded in 2018 on the NSE.
Diversification
In furtherance of the previous approval of change of name from Africa Prudential Registrars plc to its current name, a cardinal reason is the diversification strategy for the company, thereby bringing more and sustainable value to shareholders. I am glad to inform you that our company now has evolved from unitary to three main business lines: Registrars Business, Digital Technology Business and the Cooperative Business.
Product redesign
In line with our unending desire to continually improve the service experience and value offerings to our different categories of clients, our product range has been redesigned and upgraded. Our product are designed to create convenience at optimal value for our clients as they remain the central focus of our product development and improvement activities.
People development
Our people are critical stakeholders in our business. We have increased the provision of adequate functional trainings across all levels to equip our staff on current trends and skillset requirements to delivering exceptionally in their roles and also providing enabling environment for their career advancement. As a merit-driven organisation, we will continue to offer equal opportunities to all deserving persons regardless of sex, tribe, race and religious affiliation.
Outlook
While the global economy is expected to slow in 2019 as growth decelerates across the world’s largest economies, downside risk factors to the outlook in 2019 include the likely escalation in trade tension, expected slowdown in commodity prices, rate normalisation in advanced economies, likelihood of no deal Brexit, escalating security situation in the Middle East and sub-Saharan Africa, and political development in Italy, Germany and Nigeria. The Nigerian economy is projected to grow at 2.3 per cent in 2019, driven largely by growth in the Information and Communication sector, the agricultural sector , the manufacturing sector and stability in oil production. The NSE is expected to sustain its mixed performance in the first half of 2019 due to the uncertainty around the general election, coupled with the impressive corporate results and corporate action activities of listed companies. The market is expected to experience a mild rally in the second half of the year as we expect improved foreign capital investment inflow in the aftermath of a successful general election.
This year, Africa Prudential Plc will continue to leverage technology to enhance the experience of our clients across the company’s business lines.
Registrar Business
The main focus for the registrar business is the relentless pursuit of exceptional experience to shareholders, client companies, stockbrokers and other critical capital market stakeholders through continuous process improvement, deployment of our enhanced digital solutions and collaboration for improved technology application across the Nigerian capital market.
Cooperative business
We will intensify efforts to enhance the adoption of applicable technology by cooperatives to drive improved productivity, cost efficiency and value creation in the cooperative space in Nigeria and across Africa. We will continue to be a worthy partner in the enhancement of financial inclusion by improving the productivity of cooperatives, both in the urban and rural spread across the country. Our enhanced EasyCoop solution will be a game changer in the delivery of great experience and value creation for cooperatives on the continent.
Digital technology
This business will focus on creating convenience through the application of technology across different markets. We will continue to innovatively explore the application of digital technology to provide secured solutions for both retail and corporate users.