- Companies need enabling environment, ease of doing business — analysts
- We’ll continue to navigate our growth — Company Directors
Seven quoted companies at the Nigerian Stock Exchange have reported N60, 744billion increase in shareholders’ equity to N1, 038.914trillion in the nine months ended September, 2018, from N978, 169.99billion last year.
The companies are Seplat Plc, Oando Plc, Unilever Nigeria Plc, Presco Plc, Nestle Nigeria Plc, Julius Berger Nigeria Plc, and Total Nigeria Plc.
Shareholders’ funds or shareholders equity refer to the amount of equity in a company, which belongs to the shareholders. The amount of shareholders’ funds yields an approximation of theoretically how much the shareholders would receive if a business were to liquidate.
We will continue to navigate our growth by innovative means. As a business, we will continue to innovate with focus on key growth sectors of the Nigerian economy that will enrich lives and grow the bottom-line. We will also continue to leverage on our areas of strength to drive sustainable growth and deliver superior returns to our esteemed shareholders
Equity analysis
A breakdown of the results from various sectors of the economy showed that Oando Plc led with 5.82per cent shareholders’ funds, to N278, 767.05billion in the nine months ended September 2018, from N263, 435.78billion which was reported at the review period.
Unilever Nigeria Plc followed with 8.82 per cent increase in shareholders’ funds to N82, 601.10billion in 2018, from N75, 908.38billion at the same period last year, while Presco Plc reported 4.32 per cent shareholders’ funds to N79, 260.53billion, from N75, 980.17billion in 2017.
Nestle Nigeria Plc recorded 25.37per cent increase in shareholders’ funds to N56, 263.30billion in 2108, from N44, 878.18billion at the review period. Seplat Plc reported 4.36 per cent rise in shareholders’ funds to N479, 704.00billion, from N459, 646.00billion in 2017, while Julius Berger Plc also had an increase of 6.79per cent in its shareholders’ funds in the nine months ended September 2018, to N32, 138.18billion, from N30, 095.93billion which was recorded last year.
Total Nigeria Plc reported 6.92 per cent rise in shareholders’ fund to N30, 179.84billion in 2018, from N28, 225.55billion in the review period.
Directors assure of sustainability
However, some market pundits who spoke with our correspondent in separate interviews believed that the growth was attributed to the efforts of the firms in complying with good corporate governance code and the ability to enhance the quality of financial system stability.
Some of the Managing Directors who spoke in an earlier interview with our correspondent said, “We will continue to navigate our growth by innovative means. As a business, we will continue to innovate with focus on key growth sectors of the Nigerian economy that will enrich lives and grow the bottom-line. We will also continue to leverage on our areas of strength to drive sustainable growth and deliver superior returns to our esteemed shareholders.”
Group Chief Executive, Oando Plc, Wale Tinubu, while speaking with stakeholders recently in Lagos, assured of his company’s commitment to delivering tailor-made solutions in line with the Global Sustainable Development Goals.
”As a matter of necessity, we remain committed to delivering solutions that satisfy stakeholders’ needs and objectives while also providing adequate financial returns to our shareholders,” he said.
Commenting on the result, Managing Director/Chief Executive, Seplat, Austin Avuru, said the profit reported in the period was largely as a result a strict adherence to international management practices and corporate governance, which includes a detailed environmental and social
policy.
“We set out from day one to create a Nigerian company with global standards of corporate governance,” Avuru said, adding, “It is not as though it happened by chance.”
Seplat’s decision to go to market was in part motivated by a desire to prove its commitment to corporate governance and to be constantly measured against international standards.
“Although the ability to access capital quickly will give the company considerable flexibility as it navigates the fast-moving Nigerian energy sector. Continue to maintain market leadership with occupancy levels that are way ahead of competition,” Avuru added.
Shareholders’ perspective
National Chairman, Progressive Shareholder Association of Nigeria, Mr. Boniface Okezie, said even though the firms recorded a growth in their shareholders equity, both the Federal Government and the regulatory authorities should do more to encourage the companies as they can be better
for it.
He explained that rather than creating an enabling environment for more companies to thrive and list on the Nigerian Stock Exchange, government agencies are stunting the growth of companies through their various fines and
charges.
An expert on the economy, Mr. Idowu Okunola, attributed the growth to improved performance and efforts
across board by all stakeholders, adding that every enterprise requires funds both at the initial stage of operations and during the development and sustainable business
stages.
Okunola however expressed worry over what he called government foot-dragging on the ease of doing business
implementation.
“It sounds ironic that government and its agencies are playing discouraging roles on the growth of companies in the country through excessive charges and
fines.
“Instead of using moral suasion in dealing with valuation of such rules, these regulators use punitive measures and
various fines. This is making some companies to have a second thought, whether to remain listed or go private,”
he said.
