United Capital Plc has released its unaudited results for the first quarter (Q1) period ended March 31, 2020, posting 53 percent increase in profit before tax (PBT).
The company’s statement of profit or loss shows revenue: N1.92 billion in Q1 2020, compared to N1.45 billion in Q1 2019, which represents 32 percent year on year (YoY) increase.
Operating Income: N1.89 billion in Q1 2020, compared to N1.35 billion in Q1 2019 (40 percent YoY increase).
Operating expenses: N0.74 billion in Q1 2020, compared to N0.68 billion in Q1 2019 (9percent YoY increase).
Profit Before Tax: N1.18 billion in Q1 2020, compared to N0.77 billion in Q1 2019 (53percent YoY increase). Profit After Tax: N0.99 billion in Q1 2020, compared to N0.64 billion in Q1 2019 (54percent YoY increase). Earnings Per Share: 17 Kobo. (2019: 11kobo)
Its statement of financial position shows total assets: N197.41 billion, compared to N150.46 billion as at FY 2019, which implies 31percent year-to-date (YtD) growth.
Total liabilities: N176.69 billion, compared to N130.88billion as at FY 2019 (35percent YTD growth). Shareholders Fund: N20.72 billion, increased by 6percent YtD as at FY 2019 N19.59 billion.
Comparing Q1 2020 with Q1 2019, the company noted a few points to note such as
Total Revenue: United Capital Plc’s total revenue increased significantly by 32percent year on year, “on the back of the company’s 55percent increase in fee and commission income and 223percent increase in net interest margin as well as a 149percent growth in Net trading income”.
“Cost-to-Income ratio: This improved significantly, recording 39percent in Q1 2020 compared to the 47percent recorded in the same period last year, as the Group continues to implement its cost containment measures.
PBT Margin: During the period under review, PBT Margin stood at 61percent on the back of revenue growth and sustained implementation of cost containment measures.
“PAT Margin: During the period under review, PAT Margin stood at 52percent on the back of revenue growth and sustained implementation of cost containment measures.
Total Assets: Total Assets grew YtD by 31percent as a result of the 154percent increase in cash and cash equivalent and 2percent increase in Trade and other receivables.
“Total Liabilities: This increased by 35percent owing to the growth in short term investment by 57.50percent, trust funds by 79.17percent and sinking funds by 92.25percent. In aggregate, the Group’s managed funds grew by 61percent.
“Shareholders’ Fund: The Shareholder’s wealth grew by 6percent YtD on the back of the increased PAT leading to a 6percent growth in retained earnings,” it stated.
While commenting on the group’s performance the Group CEO, Peter Ashade said: “Year 2020 has posed a lot of challenges to the Nigerian economy – as we saw decline in oil prices- the operating environment was also impacted negatively, with the exchange rate becoming more volatile, continued fall in rates in the money market as well as bearish sentiments in the capital market. Our business was not immune to these challenges; however, the Group was able to endure the first quarter of the year. Thanks to our well-articulated and diligent implementation of our plans set out last year, we were able to deliver a 32percent year on year increase in revenue and 53percent increase in PBT. This increase was generated basically from our margin on investments and the 55percent YOY increase achieved on our Fees and commission income as well as a 149percent growth in net trading income. Our investment income shrank this quarter due to the drop in returns in the money market.
“As we work into the coming quarters, we are constantly reviewing our strategy in light of the current global pandemic in the wake of COVID-19. As a Group, we were able to invoke our business continue framework which has worked immensely well over the past few weeks as we have been able to stay afloat with our work-force working remotely to ensure the continued operations of our business,” he said.
Discussing the result further Ashade noted that;
“In line with our initial strategy for the 2020 business year, we shall continue to push further our market diversification and cost-optimization initiatives as well as implement phased automation of our business processes whilst upholding our commitment to ensuring a significant improvement in our value delivery to all our stakeholders.”
