Another Slow Year for GTCO?

Good morning and welcome to this week’s edition of 4 Customs Street, our weekly newsletter on the stock market.

The newsletter is divided into two: 

• Green White Green—focused on the Nigerian stock market. 
• Star-Spangled Banner—focused on the US stock market.

Green White Green Last Week 

Another slow year for GTCO? 

GTCO’s gross earnings increased by 15% from N207 billion in 2021 to N236 billion in 2022. 

Profit before tax rose by 10.9% from N93 billion in 2021 to N103.2 billion in 2022. Profit after tax, however, dipped slightly by 2.4%  from N79.4 billion in 2021 to N77.5 billion in 2022. 

This was due to a sharp rise in income tax from N13.6 billion in 2021 to N25.6 billion in 2022, up by 88.3% year-on-year.

The group has proposed an interim dividend of 30 kobo per share, unchanged from the prior year. An interim dividend is one paid before the end of a company’s financial year. 

Qualification date is September 20, while September 30 is the payment date.

For FY 2021, profit after tax dipped slightly from N201.4 billion in 2020 to N174 billion in 2021. If H2 2022, does not come in marginally better, FY 22 profit after tax could come in much lower. 

Different strokes for UBA 

UBA had a much better half year. Gross earnings increased by 17.8% from N316 billion in 2021 to N372 billion in 2022. Profit after tax went up by 16.1% from N60.5 billion in 2021 to N70.3 billion in 2022.

It maintained the 20 kobo it paid as interim dividend last year. Qualification date is September 22 and payment date is September 29.

UBA operations can be split into three by geography: Nigeria, Rest of Africa and Rest of the World. 

Nigeria accounted for 58.6% or N218 billion of income made during the period. Rest of Africa generated 40% of the income amounting to N150 billion. Rest of the World rounds up the rear at N17 billion.

Nigerian operations saw a 73.9% increase in profit after tax from N21.1 billion in 2021 to N36.7 billion in 2022. 

Year-on-year, profit from African operations dropped by 18.9% from N42 billion in 2021 to N35.3 billion in 2022 largely due to a spike in impairment charges. A loan is considered impaired when it is probable that not all of the related principal and interest payments will be considered. 

Fidelity’s private placement 

Fidelity Bank will hold an Extraordinary General Meeting on Thursday, September 29, 2022. The bank will be seeking shareholders approval to raise capital by issuing 3,037,414,308 shares via a private placement. A private placement is a sale of shares to preselected investors. 

Green White Green This Week

GTCO and UBA will hold analyst calls during the week. During the calls, analysts (and members of the public) can ask questions pertaining to the firm’s half year results and plans for the second half of the year. 

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Star-Spangled Banner Last Week 

Apple last week unveiled its iPhone 14 lineup. Comparing the prices of iPhone 13 and iPhone 14, they remained unchanged. 

The iPhone 14 and iPhone 14 Plus cost $799 and $899 respectively, while the iPhone 14 Pro and iPhone 14 Pro Max started at $999 and $1,099.

The iPhone 13 launched at $799 and the iPhone 13 mini at $699. The iPhone 13 Pro and iPhone 13 Pro Max launched at  $999 and $1,099 respectively. 

Star-Spangled Banner This Week 

Adobe and Oracle will release their latest quarterly earnings during the week. 

Twitter shareholders will hold a special vote to consider Elon Musk’s offer to buy the company. The Tesla founder has never been one to shy away from his words, so it is bound to be an interesting week.

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