Guinness tops stock market 0.58% rebound

…as news of recession exit impacts shares

After trading in the red zone for the past five successive sessions, the equities market returned to a path of growth as the Nigerian Stock Exchange (NSE) All Share Index (ASI) advanced 0.56 per cent on Wednesday, buoyed by gains in Guinness and 21 other listed firms.

Guinness Nigeria Plc led Wednesday’s 22 gainers as its share price improved 10.24 per cent, following an impressive 2017 full year report released on the floor of the NSE on Tuesday. The stock thus progressed from Tuesday’s positive performance to close at N87.30 per share.

It was trailed by Red Star Express Plc which appreciated 9.82 per cent to close at N4.81 per share while Air Service Plc added 4.93 per cent to close at N5.96 per share.

Consequently, the ASI added 205.15 points to settle at 35,609.07 points while the market capitalisation also grew by N70.7bn to close at N12.273 trillion bringing year-to-date returns to 32.11 per cent.

Although the first trading day (Tuesday) in the month of September kicked off on a negative note as investors barely reacted to the news of Nigeria’s exit from recession, announced by the National Bureau of Statistics (NBS) on Tuesday, data from the NSE showed all sectors rebounded on Wednesday with the Oil and Gas Index recording the highest gain of 1.32 per cent.

Price movement chart showed 22 gainers were paired against 23 losers. PZ led the day’s losers with a depreciation of 4.98 per cent to close at N25.94 per share, Morison dropped 4.88 per cent to close at 78 kobo per share and Linkage Assurance declined 4.48 per cent to close at 64 kobo.

At the end of the day’s transactions, investors in 4,066 deals traded a total of 281.8m shares worth N5,4bn, compared to a total of 230.0 million shares valued at N4.775 billion on Tuesday.

GTB emerged the most traded stock with 68.5 million units sold at N2.6billion, Access Bank was next with the sale of 56.6 million units of shares valued at N577.7 million. FBN Holdings was third with the sale of 32.7 million shares worth N194.7 million, Fidelity Bank sold 25.1 million shares at N32.6 million while Sterling Bank sold 11.5 million shares worth N11.7 million

Meanwhile the management of Guinness has recommended the payment of a final dividend of N963.8m subject to shareholder approval at the company’s next annual general meeting.

The recommended dividend which will amount to 64 kobo per ordinary share, is 14 kobo or 28 per cent higher than a final dividend of N752.9m, which amounted to 50 kobo per ordinary share approved and paid for the 2016 financial year.

The closure date for the dividend is September 29, 2017, while the payment date has been scheduled by the company for October 26, 2017.

The company’s Annual General Meeting has been slated for Wednesday, October 25, 2017.

Guinness recently released its 2017 financial year scorecard reporting a gross profit of N48.3bn, which is 16 per cent higher than the previous year and an operating profit of N10.2bn representing an increase of 131 percent year on year.

The results also revealed the brewing firm returned to a profitable position with the declaration of N1.9bn as net profit as against a loss of N2.0bn in the preceding year.
Earnings per share consequently rose to N1.28, as against a loss of N1.34 recorded a year ago.

Commenting on the results, Mr. Peter Ndegwa, Managing Director/CEO of Guinness Nigeria, said that the company’s results were driven by a relentless focus on executing the company’s strategy and keeping costs down.

“Despite the challenging economic conditions, we have remained focused on executing our company’s total beverage strategy which gained further traction with strong growth in our international premium spirits portfolio following our first full year of distribution,” he said.

Speaking further, Ndegwa said, “Our gross profit of N48.3bn is as a result of volume growth, pricing benefit and a favourable sales mix as we continued to invest in our expanded brand portfolio during the year.
“Part of that investment includes the N4.7bn spirits line for locally manufactured spirits which we commissioned in Benin.

“These strategic acquisitions and expansions have filled the gaps in the spirits brand base allowing us to compete across all categories of the alcoholic beverage market in Nigeria.

“We remain committed to executing our productivity agenda with a strong focus on cost reduction, distribution and operational efficiencies.”