NPF Microfinance has started 2019 on a weak foot and would need to avoid the slowdown in momentum which saw its bottom-line slide to a 5 year low in 2018, earnings results from the micro-lender show.
Formerly NPF Community Bank Ltd, the Microfinance bank had some difficulty in keeping its impairments and expenses under reins in 2018 and saw its bottom-line dwindle, even though its full-year gross earnings for 2018 is currently at a 5-year high. Q1 2019 figures show similar difficulties with impairment losses.
NPF reported that its pared profit in 2018 by 69 percent to N195.75 million, although it had grown bottom-line for three straight years, while the company’s Q1 2019 figures show a profit decline of 6.8 percent to N194.34 million.
In 2018 NPF had a strong start to the year, growing profit by 7 percent in the first quarter of the year but lost steam as 2018 progressed.
The Microfinance bank recorded a 96 percent plunge in profit, year-on-year, from N239 million to N10 million in Q3 2018 which ultimately affected its full-year result.
For Q1 2019, the micro-lender posted revenue of N972 million, some 5 percent more than it had recorded in the same period of 2017.
In the quarter NPF’s interest expenses rose faster than interest income at 32 percent compared to 6.9, resulting in a net increase of Net interest income by 2.6 percent to N598 million.
NPF was unable to increase its revenue from fees and commission in the quarter as figures dipped by 8 percent, but saw an increase of about 27 percent in other income. Consequently, net operating income saw an uptick of 1.34 percent to N840 million in Q1 2019.
While revenue dragged, expenses rose by 4.1 percent to N645.62 million owing to a 58 percent surge in the company’s net impairment loss on financial assets, and a 22 percent rise in depreciation.
Profit before tax in the quarter dropped by 6.79 percent to N194.35 million, and resulting in a reduction of the company’s earnings per share from N9 in Q1 2018 to N8 in 2017.
Shares of NPF Microfinance Bank fell by 7.69 percent on Monday to N1.2 per share after it had remained flat at N1.3 per share for seven trading sessions.
NPF Microfinance Bank Plc was incorporated on the 19th May 1993 as a Limited Liability company. The bank provides Banking services to both serving and Retired Officers and men of Nigeria Police Force, its ancillary institution and general banking public.
SEGUN ADAMS
