CSCS account statement
Just as a bank account statement gives the most accurate and recent information on a customers account,so also the CSCS account statement. An investors CSCS account statement truly gives the current state of the investments by the owner as at the time it is generated. Most times, if you are in doubt as to the authenticity of what you see in you account with your broker, request for your CSCS account statement.

MORE IMPORTANTLY.
It is important for investors to note that the shares that are reflected in the statements given by stockbrokers are most times shares that are purchased from the secondary market. In other words, it is only the shares that a broker bought for a client that will be reflected in the brokers account. In the event that an investor benefits from a bonus issue, the number of units accrual to him will not be reflected in his acoount with the stockbrokers. However, it will be reflected in his CSCS statement.

The implication
The implication is that if an investor does not regularly request for the CSCS statement to complement the records of his stockbroker, he stands the risk of not maximizing his portfolio. Simply put, he has money that he does not know about because it was not reflected in the statement from the brokers. In some cases, some brokers are effective such that they always forward their clients CSCS statement to them. On the other hand, some brokers don’t bother themselves and never even mention it.

It is very important to keep abreast with your portfolio especially in the area of knowing the current state of your holdings. Always endeavour to request for your CSCS statements so that you are able to maximize every bit of your funds in the stock market.

Article by paragon | © StockMarketNigeria.com, 2009. | Permalink | 8 comments | Add to del.icio.us
Post tags: Nigerian Stock exchange

Mass Telecom Innovation (MTI) Plc
The telecoms services company released its first quarter results for the period ended March 31, 2009. In the highlights of the result, turnover for the period increased by 27.73 percent, from N430.58 million in the same period of 2008 to N549.99 million in 2009. Profit before tax was up from N32.75 million to N50.72 million while after tax profit increased from N22.92 million in 2008 to N35.51 million in 2009.

Continental Reinsurance Plc
The insurance company also released its first quarter result for the period ended March 31, 2009. In the figures made public, gross premium inched by only 9.77 percent, from N1.03 billion in 2008 to N1.13 billion in 2009. Profit before tax dropped by 61 percent, from N0.78 billion in 2008 to N0.30 billion in 2009. Profit after tax dropped by 58 percent to N0.24 billion in 2009 from N0.59 billion in 2008.

Unilever Nigeria Plc
Known as a major player in the conglomerate sector of the exchange with a wide range of consumer products, the company released its first quarter results which showed less that expected growth. Turnover for the period moved up by 8 percent, from N9.64 billion in 2008 to N10.42 billion in 2009. Profit before and after tax moved up by only 3.9 percent to N1.64 billion and 4.4 percent to N1.12 billion respectively.

UACN Plc
The company released its first quarter result for the period ended March 31, 2009. Turnover for the period increased by 32 percent, from N10.56 billion in 2008 to N14.02 billion in 2009. Profit before tax inched higher by 9.16 percent to N1.66 billion from N1.52 billion in 2008. After tax profit was up by 12.85 percent, from N1.03 billion in 2008 to N1.17 billion in 2009.

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Post tags: Nigerian Stock exchange, UAC Nigeria, Unilever Nigeria

1. (most often) see something good in it for the shareholders
2. (rarely) obliged to do so statutorily or by a court action.

The reasons for this could be for any of the following:

1. To take advantage of a bullish market: There are times that the market gets so bullish that it will blindly multiply investors share value, ignoring the stock-split (the market prices are initially adjusted by the market operators to ensure that the market capitalization remained same as the last trading day before the split).
2. To increase the marketability of the stock:It is reasonable to split stocks when the demand perpetually surpasses its tradeable issued and fully paid share capital, especially in a growing market.
3. Take overs: It could also be a means of fighting or guarding against a market take-over.

A stock split generally promotes marketability, equity book-value remains unchanged; while the market value per share responds to market forces of demand and supply, so good for a bullish market.

What of an increased financial gearing, capital re-structure?

When the directors anticipate a long term inflationary trend in the economy, one of the things they could do to improve the chances of wealth gain due to the inflation is increasing the company’s financial gearing, thereby increasing its financial leverage position. This would affect the company’s financial structure by decreasing the equity-to-fixed debt ratio. Most companies would not take the financial risk attached to floating bonds, if not in anticipation of raking in extra profit at the expense of other peoples (bond holder) monies.

Fixed interest (debt) capital is rarely free, it will always call for interest payment; charged on the trading, profit and loss account. If the company directors considers the large scale operation gains due to an increase in debt-capital, to be greater than the cost of fixed interest (debt) capital, then the economy is most likely experiencing an inflation; it is then wise to favor the shareholders by asking for any reasonable form of fixed interest debt providers funds.

The motives for increasing a companies financial gearing could be:

1. To lock in low interest long term debt instrument funds. This is achieved by floating long term callable bonds in periods of low inflation rate, when the interest rates are low, with the intention of locking-in the cheap funds in future periods when the interest rates rises again, or call back the securities if the rates eventually moves downwards in future
2. To avoid dilution of shares (control) that may occur if it floats more of its authorised ordinary shares capital
3. To cut down on income taxation, by utilising the tax relief benefits of debt instruments.

Financial gearing is particularly good for corporate business entities whenever interest rates and inflationary rates are both expected to accelerate for a long time; thereby increasing earnings per share (EPS).

Article by maduagufor | © StockMarketNigeria.com, 2009. | Permalink | No comment | Add to del.icio.us
Post tags: Maduagufor Ugonna

Without going deep into the pre- Dangote acquisition of the company, what most people, especially company workers would recall back in 2005 was the poor state the company was in with huge outstanding salaries and debt. Infact, it would not be out of place to say that the company was moribund. Few years down the line, and BCC has become the most sought after stock in the building materials sector of the Nigerian Stock Exchange. So where and how did it all happen?

After the take over in 2005, Dangote injected fresh capital into the company which amongst other things saw workers being paid their outstanding salaries. This indeed was a good motivator for not just the staff but the company as well. Also, a new production line was installed and commissioned which saw production capacity increase to 3 million tonnes per annum.

So far, Dangote has injected about $500 million into the company which has impacted in its financials.After receiving boost in production capacity in 2007, the turnover of the company increased by over 200 percent between 2007 and 2008. Turnover increased from N5.47 billion in 2007 to N16.45 billion in 2008. Profit before tax and after tax also increased by 153.10 percent and 230 percent respectively. Net Assets increased from N9.60 billion in 2007 to N13.75 billion in 2008, indicating that the company is really poised to grow the business.

Challenges and Opportunities
The company faces a major challenge in terms of power which it has tackled as it has commissioned its own independent power station. Some other challenges include logistics, competition from other major players in the sector. As regards debt, the company has performed well it reducing its debt which will ease up its cash flow very soon.

On the other hand, the company stands to gain from the huge infrastructural and housing development in Nigeria which is still growing. With a growing population and acute shortage of houses, Nigerian cement manufacturing has still not been able to meet up with demand . This has resulted in the ongoing importation of cement.

In its 2007 result, the company declared a bonus of 1 for 8 , while in its just released 2008 result, it declared a bonus of 1 for 4. The share price as at the time of takeover by Dangote in 2005/2006 was about N5.00. With a closing price of N38.20 on June 16, 2009, the stock has appreciated by over 600 percent in a little over three years.

Article by paragon | © StockMarketNigeria.com, 2009. | Permalink | One comment | Add to del.icio.us
Post tags: ApprovedO, Benue Cement Company

With prices of most stocks still trading at below real value, the upward move in stock prices experienced on Monday is likely to be sustained throughout the week. More so, the market was flooded with impressive company results as well as mouth watering profit forecasts in the just concluded week, which might have also aroused investors appetite. Below are some company scorecards as well as forecasts that have recently been released on the floor of the exchange.

Benue Cement Company Plc
The cement manufacturing company recently released its full year result for the period ended December 31, 2008. In the figures released, turnover for the period stood at N16.45 billion as against N5.47 billion in 2007, representing an increase of about 200 percent. Profit after tax increased from N1.25 billion in 2007 to N4.14 billion in 2008. The company has recommended a bonus of 1 for 4, with register closing on July 6, 2009. The company also gave out bonus of 1 for 8 in its last financial year.

The company also released its first quarter result for the period ended March 31, 2009 in which turnover increased from N1.04 billion in 2008 to N9.31 billion. Profit after tax for the quarter stood at N5.34 billion compared to N0.19 billion for the same period in 2008.

Sterling Bank Plc
The bank released its half year result for the period ended March 31, 2009 which saw gross earnings rise from N15.72 billion in 2008 to N20.49 billion. After tax profit also moved higher, from N1.87 billion in the comparable period of 2008 to N2.43 billion.

Oando Plc
Indigenous oil company, Oando plc made public its full year result for the period ended December 31, 2008. Based on the figures released, management is recommending a dividend payout of N3.00 per share which is really not what investors expected. The company in its last financial year paid a dividend of N6.00 and a bonus of 1 for 5.

Company Forecasts

Nestle Nigeria Plc submitted a forecast of N16.50 billion in turnover and after tax profit of N2.20 billion for its third quater ending September 30, 2009.

Benue Cement Company Plc has submitted a third and fourth quarter forecast for the period ending September 30, 2009 and December 31, 2009 respectively. In the third quarter forecast, turnover was pegged at N16.54 billion with after tax profit of N6.84 billion. In the fourth quarter, turnover was pegged at N16.69 billion with after tax profit of N6.72 billion.

NEM Insurance Plc
The insurance company has submitted a forecast of N4.6 billlion gross premium and after tax profit of N0.95 billion for its third quarter ending September 30, 2009.

Prestige Assurance Plc
The company has also forecast a gross premium of N2.57 billion as well as profit after tax of N0.59 billion for its third quarter ending September 30, 2009.

Article by paragon | © StockMarketNigeria.com, 2009. | Permalink | No comment | Add to del.icio.us
Post tags: ApprovedO, Nigerian Stock exchange

The bank’s return on shareholders’ funds steadily increased from 2.79% in 2005, through 9.23% and 16.88% in 2006 and 2007 respectively to 25.38% in 2008. The bank is renowned for its relatively high return on shareholders’ fund and steady increase in earnings per share (DPS) since 2005. The bank has been able to grow its revenue and profit after tax by 67.79% and 41.98% respectively in the last five years (CAGR). The bank’s H2 2008 unaudited quarterly results reflected 122.72% and 121.42% Year-on-Year growth in turnover and PAT respectively. If this tempo is sustained the bank is set to maintain its great steps to greater heights with steady increase in key performance indices since 2005.

On management strategy, the bank recently open a Group Office in high brow Lekki Phase 1 , Lagos to house its BDC, Real Estate, Trustee and Capital Market operations. The new group office is complemented with a banking hall and located adjacent Zenith Bank. The bank seems poised to compete favourably with second generation banks and time would tell how well they have fare. However, historical price data reflects newly found investor confidence in the bank as a review of the banks price trend between Jan - May 22, 2009 indicates that the 60 day Simple Moving Average (SMA) of 6.27 accelerates towards its 90 Day SMA of 6.54 and would soon peck and cross its 120 day SMA of 8.0; this is indicative of a bullish rally ahead.

Disclaimer: The opinions contained in this article should not be interpreted as an offer to sell, or a solicitation of any offer to buy any investment. Whilst every care has been taken in preparing this write up, no responsibility or liability is accepted

Article by Ogunyemi Olumade | © StockMarketNigeria.com, 2009. | Permalink | No comment | Add to del.icio.us
Post tags: Afribank, ApprovedO, Ogunyemi Olumade

Glaxo Smith kline plc declared its first quarter result for the period ending March 31, 2009 which seems to be pushing up its share price already. In the figures released, company turnover increased by 30.52 percent, from N2.96 billion in 2008 to N3.87 billion in 2009. Profit after tax also increased from N0.405 billion in the corresponding period of 2008 to N0.593 billion in 2009. This represents an increase of 46.33 percent. Still on first quarter results, Lasaco Plc, a major player in the insurance industry also released its score card for Q1 ended March 31, 2009. In it, the company experienced a reduction in turnover, but still managed to improve on its profit margins. Turnover for the period dropped by about 51 percent, from N2.22 billion in 2008 to N1.08 billion in 2009 while profit after tax increased by an impressive 69 percent. This figure grew from N0.233 billion in the said period of 2008 to N0.394 billion in 2009

Finally, the only dividend declared today was by Ashaka Cement plc. The company released its full year 2008 result which ended December 31. In the figures documented, the company turnover grew by 29 percent, from N16.47 billion in 2007 to N21.37 billion in 2008. Profit after tax improved by 29 percent also, from N1.60 billion in 2007 to N2.07 billion in 2008. Based on this, the directors have recommended a dividend payout of 30kobo with a register closure date of July 13, 2009.

It would seem investors were not pleased with the dividend declared as its share price dropped maximum points today.

Article by paragon | © StockMarketNigeria.com, 2009. | Permalink | One comment | Add to del.icio.us
Post tags: ApprovedO, Nigerian Stock exchange

The current bullish trend being experienced has lasted for about eight weeks now with signs that the bullish trend might not be disappearing any time soon. This is also happening at a time when other world markets in US, Europe as well as Asia have had a bullish run in the last two months. Whether or not this is connected to our market, it’s a possibility is all i can say. As we however end of the second quarter, investors are expecting the release of corporate results of big time companies. These results are important as they have the inherent potential of attracting patronage of investors to the market, thereby sustaining the present bullish trend. Some companies to look out for include:

1. First Bank Plc
The company ended its most recent financial year on March 31, 2009 and is expected to release its result anytime from now. With full year EPS expected to be around N2.00, it is no wonder that investors are stocking up its shares. It closed above the N20 mark on the last day of trading in May 2009. In 2008, the bank rewarded investors with a dividend of N1.20 and a bonus of 1 for 4.

2. Access Bank Plc
An aggressive player in the banking sector, the shares of the bank has appreciated by about 83 percent in May 2009 as it moved from N5.65 at the beginning of the month to close at N10.34 at the end of the month. The bank also concluded its recent financial year on March 31, 2009 and is expected to present its scorecard soon.

EPS for the full year is expected to hit N1.50 and investors are expecting a dividend payout of over N0.65 which was paid last year.

3. Union Bank Plc
This is another company to look out for. In its latest 3rd quarter result, EPS was above the N2.00 mark which is very impressive. Its just concluded its recent financial year on March 31, 2009 and is expected to deliver a superb result.

In 2008, investors enjoyed a dividend of N1.00 and a bonus of 1 for 6 from the company. The bank is known to have one of the lowest number of outstanding shares in the banking sector (about 15 billion units) which is very good.

4. Flour Mills Plc
After gaining 111.22 percent share price appreciation in May 2009, investors are indeed showing their confidence in the company. With a host of profitable subsidiaries and viable business operations, Flour Mills plc is expected to release its scorecard to the public anytime from now. With its financial year concluded in March 31, 2009, investors are expecting a reward better than the dividend of N1.00 and bonus of 1 for 10 declared last year.

In its 3rd quarter result, the company obviously had challenges as a result of the naira-dollar exchange rate amongst other things. Being a veteran in the Food/Beverages sector, investors seem confident that management would however deliver.

Some other stocks to watch out for include Diamond Bank plc, Skye Bank plc, Afribank plc, Wema Bank plc, Dangote sugar plc, Custodian & Allied Insurance and Staco Insurance plc.

Article by paragon | © StockMarketNigeria.com, 2009. | Permalink | 2 comments | Add to del.icio.us
Post tags: ApprovedO

Having decided on your target/newly chosen stockbroking firm, below are two strategies you could deploy to change your non-performing broker with ease:

Unified Clearing House Number (CHN) Strategy
This option is best for savvy investors or an experienced portfolio/fund manager. It is relatively easier and less costly to implement. It simply entails the opening of another stockbroking account in the target company (howbeit with the same CHN number with the previous account) and simultaneously maintaining the two accounts for the same portfolio. Only sell mandates are executed on the old brokers account while new buy mandates are executed in the target house. With time, when the account at the old stockbroking firm could be empty or close to being empty and the investor can then concentrate on the new stockbroking firm’s account. A unified CHN number of these accounts would allow the investor have access to the accounts on a single page on CSCS Online Access for effective management at a reduced cost.

Outright Inter Member Transfer
Simply click here to download the CSCS inter member transfer form . Fill out the appropriate sections and attach your current CSCS statement of account from your resident stockbroking firm. Ensure you do not carry out any transaction on the account until the transfer is completed. There are sections for authentication of the transfer by the Managing Directors of both the resident and the target house. The resident MDs seldom use this opportunity to conduct exit interviews with clients and thus constituting bottle necks to easy transfer. They tend to promise better service and assure the client to abort the transfer. To avoid this bureaucracy an investor could do a letter of authority to the target stockbroking firm mandating them to present the transfer documents at the resident house if the target stockbroking firm offer such share support services.

*Do kindly note that there are no openly available conventional methods for determining staff turnover; investors are advised to liaise with other investors already dealing with a prospective stockbroker for hint on this. It would also be good to develop a good rapport with ones account officer for timely mandate execution and frequent email communications.

Article by Ogunyemi Olumade | © StockMarketNigeria.com, 2009. | Permalink | 4 comments | Add to del.icio.us
Post tags: Ogunyemi Olumade

The last ten trading days in April 2009 witnessed a bullish run as prices of equities, especially blue chips were on the steady rise. The market index also witnessed a steady increase as it bounced back from below 20,000 basis points to over 21,000 basis points. The banking, petroleum, conglomerates and food/beverages sub-sectors of the exchange were mostly responsible for the bullish run. Some stocks that have gained over 20 percent between April 6, 2009 and May 6, 2009 include

UBA: from N8.36 to N11.27 (34.80 percent)
Intercontinental bank: from N6.30 to N8.30 (31.74 percent)
Guiness plc: from N89.55 to N112.00 (25.06 percent)
Nigerian Breweries: from N36.40 to N46.20 (26.92 percent)
Flour Mills: from N14.65 to N18.16 (23.95 percent)

On May 4, 2009, the first day of trading for the month, the index dropped about 48 basis points only to gain over 230 basis points the following day. This of course indicates that there is still a high demand out there for stocks, most of which are currently underpriced. If you are asking whether this rally would be sustained or not, only time will tell. Be that as it may, investors can only hope and believe that May 2009 would at least be a month of increase in portfolio value, fueled by increase in stock prices.

Article by paragon | © StockMarketNigeria.com, 2009. | Permalink | 3 comments | Add to del.icio.us
Post tags: Nigerian Stock exchange