24 — Vanguard, MONDAY, MAY 5, 2014
Corporate Finance
Union Bank’s Q1 profit falls by 54% Strong consumer spending, factory data buoy U.S. growth outlook
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.S. consumer spending recorded its largest gain in more than 4-1/2 years in March and factory activity accelerated last month, reinforcing views the economy was regaining steam. Economic growth stalled in the first quarter after a very cold and disruptive winter, but the data so far point to a strong secondquarter rebound. “The weakness in growth we saw in the first quarter is not indicative of what is going on in the economy. The fundamentals continue to look pretty good, the economy has momentum,” said Gus Faucher, senior economist at PNC Financial Services Group. Consumer spending increased 0.9 percent in March after rising by 0.5 percent in February, the Commerce Department said. March’s gain was the biggest since August 2009 and beat economists’ expectations for a 0.6 percent rise.
By NKIRUKA NNOROM
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nion Bank of Nigeria, UBN Plc, weekend, released its first quarter unaudited financial statement for period ended March 31, 2014 with significant decline in the key performance indicators. The result prepared in accordance with International Financial Reporting Standard, IFRS, requirement, filed with the Nigerian Stock Exchange, NSE, showed 54 percent drop in profit before tax to N5.0 billion from N7.7 billion recorded in corresponding period in 2013. Also, the profit after tax for the period nose-dived by almost the same margin,
declining by 56 percent from N7.8 billion in 2013 to N5.0 billion in the review period. The gross earnings at N26.0 billion, was13.08 percent decrease from N29.4 billion in corresponding period in 2013, while the interest income stood at N20.7 billion as against N18.8 billion in 2014. The bank’s total assets went down to N958.6 billion compared to N997.3 billion reported in the corresponding period in 2013. The total asset position as December 31, 2013 stood at n1 trillion. Cash and cash equivalents was down 29.74 percent to N101.1 billion from N143.9 billion in March 2013, the
customer deposits also declined to N466.4 billion from N482.7 billion, representing … percent decrease. However, the bank’s shareholders’ equity grew to N197.3 billion as against N192.2 billion in December 2013, showing an increase of 2.65 percent. Net loans and advances to customers grew by 29 percent, rising to N220.5 billion from N170.7 billion as at n March 2013. The bank also achieved some level of efficiency in its operations as the operating expenses decreased to N14.7 billion, a 3.29 percent increase over N15.2 billion achieved in first quarter in 2013. The bank said in statement
that it is currently undertaking branch optimization programme, saying that 13 branches are being refit, while another 53 will be completed before the end of the year. It added that previously upgraded branches are already yielding financial upsides and positive Net Promoter Scores (NPS), adding that divestment of four portfolio companies are almost completed and awaiting regulatory approvals. Commenting, Group Managing Director/ Chief Executive of Union Bank, Emeka Emuwa, said: “Union Bank has maintained its profitability and is delivering against key operational metrics supporting our strategy.
WEF: Global Shapers Community host 100 young CEOs By WILLIAM JIMOH
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HE Global Shapers Community, GSC, has concluded plans to host over 100 young Chief Executive Officers at the World Economic Forum, WEF, in Abuja next week. Global Shapers Community is a network of hubs developed and led by young people who are exceptional in their potential, their achievements and their drive to make a contribution to their communities. Speaking during a courtesy visit to the Nigerian Stock Exchange, NSE, as part of the company’s activities to create awareness on the initiative, Mr. Yemi Babington-Ashaye, GSC Director, said the 100 young CEOs are coming from different parts of Africa to proffer innovative and sustainable solutions to Education, Entrepreneurship, Technology and Agriculture. “In Africa today, 40 percent of the population is under the age of 15, and also on the continent 70 percent of the population are under the age of 30; there is no way a decision will be made that it will not affect these young ones. C M Y K
From Left: Mr. Rilwan Belo-Osagie, MD/CEO, FSDH Merchant Bank Limited; Mr. Osaro Isokpan, Chairman and Mrs. Oyindamola Ehiwere, Company Secretary at the FSDH Merchant Bank Ltd AGM in Lagos.
Chams records 21.3% increase in turnover By WILLIAM JIMOH
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HAMS Plc has recorded N3.44 billion turnover, representing 21.3 percent increase, compared to N2.84 billion recorded in 2012. The company recorded a profit after tax of N188.5 million, 115.3 percent increase, compared to N87.5 million in the last financial year, while its earnings per share improved to seven kobo, more than twice what was posted the previous year. Addressing shareholders at the30th Annual General Meeting, AGM, of the company in Lagos, Mr. Ayodeji Richards, Chairman, Chams Board of Directors, stated that its shareholders funds improved by five percent from N4.5 billion recorded in 2012 to N4.7 billion in the year under
review. Richards, who expressed optimism that the results will be better in the coming year, added that to achieve this level of performance in 2013, Chams embarked on some business initiatives, including; national identity project, payroll automated project for the Osun State and identity management for Anambra State among others. “Chams Plc undertook projects of significant financial import in the local identity management and transaction payments space in 2013. Before now, specifically 2008, your company started committing resources to investment in infrastructure for identity management and transaction payment to make it the market leader in this emerging industry. “The demand for identity management and transaction
payment solutions is likely to continue growing at a Compound Annual Growth Rate, CAGR, of five percent until 2018. The likelihood of demand growth will arise from the ongoing implementation of the Central Bank of Nigeria’s cashlite policy, increasing financial inclusion and digitalisation of commerce, presenting opportunities for technology solution providers in our line of business,” he added. Speaking on why the company did not declare dividend this year, Richards said, “Thank you for your patient so far and we do not want to push that patient so hard; the truth is that we have had challenges in our operations in the past five years, it was a mistake on our own part and we want to own up to that. We concentrated a lot on federal government
business and that was because we hold the national identity card project dearly. “But we have challenges on the project, wanted to do all within our capacity to ensure that the project is successful. As business men, we have done a lot of investment, but waiting for the government to dot the I and cross the T. “Two years ago, we decided that we will have to do things that will enable us to make returns to our shareholders, so we did a restructuring and a repositioning to change our business model. This has started to yield dividend in the last two years. 2009 through 2011 we recorded successive loss, thank God in 2012 we posted a profit and in 2013, it superseded the performance of 2012. With what we have on ground now, they are very good, positive and robust.