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Economy

Seplat posts N73bn profit in 2018, assures shareholders of enhanced returns

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Seplat Petroleum Development Company Plc on Thursday said it recorded a profit of N73 billion for the financial year ended Dec. 31, 2018.

Speaking at the company’s sixth Annual General Meeting (AGM) in Lagos, Seplat Chairman, Dr ABC Orjiako, said the profit rose by 480 per cent when compared with N13 billion in 2017.

Orjiako who assured the shareholders of increased value creation and capital appreciation said revenue during the period stood at N220 billion against N137 billion in 2017.

“A review of Seplat’s 2018 results indicates positive performance across all financial indices, confirming the company’s position as one of the well managed indigenous oil firms in Nigeria,’’ he said.

Seplat’s operating profit stood at ₦95 billion as at review period, representing a growth of 177 per cent over the ₦34 billion it recorded in the corresponding period of 2017.

The company’s net profit after tax dipped by 45 per cent from ₦81 billion to ₦45 billion during the period under review.

Orjiako said the company’s 2018 operational and financial performance reflected the significantly higher year-on-year levels of production uptime at its core oil producing assets combined with a firmer, “albeit still volatile, oil price and increased contribution from the company’s gas business.

“As you are aware, our results from the previous two years were characterised by the extended period of force majeure at the Forcados terminal from February 2016 to June 2017.

“As we enter 2019, our reliable production base, low unit cost of production and discretion over capital commitments will allow the business to remain highly free cash flow generative and profitable.

“In the absence of any major interruption or force majeure event, this will enable Seplat to honour its dividend policy and provide an attractive yield to our shareholders in addition to the potential for capital appreciation,” Orjiako said.

He noted that the company would selectively invest in low risk oil production drilling opportunities within its existing portfolio.

The chairman added that the company would continue the expansion of its gas business, and intensify the development of its large scale Assa-North and Ohaji-South (ANOH) gas and condensate plants in 2019.

He added: “Seplat remains an ambitious growth-orientated company that is in a position of strength to capture inorganic opportunities where we can leverage our competitive advantages to seek out carefully considered, price disciplined and value accretive acquisition.’’

Mr Austin Avuru, the company’s Chief Executive Officer, said Seplat had an excellent outing resulting in robust profitability and cash flow generation that would lead to solid foundation for growth in the coming years.

“At our core assets in the West, OMLs 4, 38 and 41, the extension of the license to 2038 means that we can confidently plan and invest long into the future to realise the full potential of those blocks.

“As Seplat continues to enhance production and revenue diversification with new wells scheduled at OML 53 in the East, the board took the Final Investment Decision to invest in the large scale ANOH gas and condensate development, which will form the next phase of transformational growth for our gas business.

“Disciplined capital allocation continues to remain at the core of our activities evidenced by our continual deleveraging of our debt levels to the current balance of US$350m,” he added.

Avuru noted that Seplat’s board had recommended a final dividend of $0.05 per share to all its shareholders.

Economy

Former NERC boss wants strong regulations to boost power sector 

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 Mr Sam Amadi, former Executive Chairman of  the Nigerian Electricity Regulatory Commission (NERC) has called for strong regulations to drive the power sector for effective service delivery.

The forum has as its theme “Rules Compliance for Nigerian Electricity Market (NEM) Development and Sustainability”.¹

`We  need to strengthen the regulations in the sector, government is trying with some policies intervention but policies cannot drive a regulated market. It is policy plus regulation .

“What TCN is doing by  focusing on  smart rules that can force this entities to perform is in the right direction.

“We should not think that the investors  are coming to do the people good but they are coming to exploit the market .

“Our focus should be to create regulations that can put  incentive and reassess capacity of the investors by setting a bench mark,” he said.

Amadi said that  the critical issue in the market was funding, adding that  market participant know what to do to improve the sector

According to him, the assumption is that it will be easy for private investors to raise capital to finance short term recovery of capacity and long time improvement of that.

“The wrong assumption was that tariff will provide the finance but its not possible even if you increase tariff by 1000 per-cent.

“The people cannot pay enough and the DisCos do not have good revenue management procedure to recover their money

“Primarily, we need to have a sector that can finance in the long term and recover the long term .

“We need to go back to reassess the capacity of the investors, if they cannot do the job, you find a way to divide their franchise in a  way that it does not amount to risk.

Edited by Ese E. Ekama

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Economy

Cornerstone Insurance evolves complaints , dispute management policy for improved service to shareholders

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Cornerstone Insurance Plc said that its shareholders  and policy holders would continue to enjoy its  improved service through its newly  evolved  Complaints and Dispute Management Policy.

According to the company’s boss, the adoption of the policy is in compliance with the rules and regulations of the Security Exchange Commission (SEC).

The underwriter said  that the policy had  set a broad framework by which the company and its registrars would  manage shareholders’ complaints and enquiries in a fair, impartial, efficient and timely manner.

He added that the company in the annual report received   26 complaints in the 2018 financial year out of which 25 complaints had  been resolved.

“The only complaint not resolved within the approved period was attributed to unavailability of the customers the company could not reach  them through e-mail and phone contacts they submitted, after the resolution of the complaint,”  Musa said.

The MD  while commending  the shareholders of the company said that the company would sustain its growth trend of 2018.

He added that   the company was embarking on strategies that would enable it meet the recapitalisation requirements as directed by the National Insurance Commission (NAICOM) for Tier-Based Minimum Solvency Capital (TBMSC) implementation.

The chairman of Noble Shareholders Solidarity Association, Mr Matthew Akinlade,  speaking at the AGM commended the underwriting firm on the  successful financial year.

He, however ,urged the underwriter to watch the proportion of its portfolio in the Oil and Gas sector.

Akinlade said, “When the economy suffers depression, there is always pressure on the  Oil and Gas sector which may result in huge claims.

“When the huge claims arise, the financial strength of the company will be affected.”

The Nigeria News Agency reports that the underwriter in a statement that preluded the AGM, released  on Aug. 19, said its Gross Written Premium (GPW)  had hit N11.5 billion in the 2018 financial year. 

Edited by Peter Dada

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Economy

Minister pledges commitment to promote economic growth

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Mr Adeniyi Adebayo, the new Minister of Industry, Trade and Investment has expressed his commitment toward achieving national economic growth.

Adebayo, also a legal practitioner made this known on assumption of office on Wednesday in Abuja.

“We have been given the task of heading this ministry to achieve that intention, we will work very hard to make sure we live up to the confidence reposed in us by the president.

“We believe in hard work and we must work hard and work out action plans to enable us achieve the goals. We look forward to your cooperation for the growth of  the ministry,” he said.

Amb. Maryam Katagum, the Minister of State, Industry, Trade and Investment also expressed gratitude to the Federal Government for finding her worthy to join in running the affairs of the ministry for national development.

“We have just four years to deliver on the mandate of Nigerians. We intend to vigorously pursue the mandate given to us by the president.

“On a very broad level is to say that we believe that the delivery of that mandate does not rest on the civil servants but we are definitely counting on you and seeking your support.

“We have to give value to tax payers money,” the Katagum said.

Earlier,  Mr Edet Akpan, the ministry’s Permanent Secretary said that the ministry was restructured in 2011 and  had risen to the position of developing the industrial sector to attract local and foreign investors.

According to Akpan, the ministry has 12 departments and 17 agencies and prayed God to give the ministers wisdom and direction to pilot the affairs of the ministry.

The Nigeria News Agency reports that Adebayo who hails from Ekiti State was born on Feb. 4, 1958 and obtained a law degree from the University of Lagos in 1981.

Otunba was elected Governor of Ekiti State in 1999. He is currently APC Deputy National Chairman (South).

Katagum who hails from Bauchi State,  born on  Nov.15, 1954, holds a Bachelor’s degree in English from Ahmadu Bello University, Zaria and a Masters in Administration and Planning from the University of Lagos.

Until her nomination, she was the Ambassador and Permanent delegate of the United Nations Educational Scientific and Cultural Organisation (UNESCO) in Paris, France.

The highlight of the event was the presentation of two copies of the  “Hand Over Note” to the new ministers.

Edited by Ese E. Ekama

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Economy

FG issues N59.53 billion in August bond auction- DMO

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The Debt Management Office (DMO) on Wednesday, issued N59.53 billion Federal Government bonds for the three tenors it offered to various investors who subscribed at the auction.

The DMO said this in a statement it issued in Abuja after the auction.

It said it offered N40 billion for the five year papers, N50 billion for the 10-year and N55 billion for the 30-year bonds.

According to it, total subscriptions received from both Competitive and Non-Competitive bids amounted to N139.58 billion.

“Demand for the 30-year bond remained strong as has been the trend since the instrument was introduced to the market in April 2019.

“The total subscription for the 30-year at the auction was N64.71 billion.

“The strong demand from investors for the bonds offered at the auction was in spite of the prevailing tight liquidity experienced in the financial markets”, it added.

The DMO said that allotments were made to successful bidders at the rate of 14.29 per cent for the five year, 14.39 per cent for the 10-year and 14.59 per cent for the 30-year bonds.

According to the auction results obtained from the DMO website, N2.05 billion was allotted to four successful bidders for the five-year and N2.68 billion to five bidders for the 10-year papers.

Meanwhile, N10.30 billion was allotted to 11 bidders at for the 30-year bonds, bringing the total allotments to N15.03 billion.

It said that an additional allotment of N44.5 billion was made on non-competetive basis for the three tenors.

The Nigeria News Agency (NAN ) reports that Nigeria issues sovereign bonds monthly to support the local bond market, create a benchmark for corporate issuance and fund its budget deficit.

Edited by Ifeyinwa Omowole

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Economy

Kaduna Disco fixes minimum bill remittance for communities to get power supply

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The Kaduna Electricity Distribution Company (KEDCO) on Wednesday said it had fixed the minimum of bill remittance by consumers in some communities in Kaduna state, before getting power supply.

The company said its decision followed an agreement with leaders of four communities within Kaduna city  on estimated billing payment system.

Malam Musa Usman, the DISCO’s Area Manager for Rigasa area office disclosed this to newsmen on Wednesday in Kaduna.

Usman said the measure became necessary following drastic fall in revenue collection of the company in the state.

“Leaders of four communities under the Rigasa Area Office have agreed on the minimum amount for their monthly bills’ payment while the KEDCO will accord the communities priority in power supply.

” This is part of the outcome of the recent town hall meetings and agreements reached between the Company and community leaders from Kinkinau,, Government House Feeder, Hayin Danmani and Rigasa in Kaduna South, Kaduna North and Igabi Local Government Councils of Kaduna State.

“All electricity users in the areas shall pay their monthly current charges and a fraction of their outstanding where applicable,” Usman said.

He said that three of the communities were until recently placed on the company’s priority feeders, but were later downgraded due to the customers’ poor response to payment of monthly electricity bills.

The Area manager said the agreement would hopefully scale up the declining revenue in the area and other parts of the state.

According to him, the decision was based on what the company  realised in its monthly collection lately, which was less than 30 percent of the cost of the electricity supplied to consumers.

“We cannot afford to fold our arms and watch the company defaulting in its obligations.

“The experience in which some DISCOS were suspended  from the electricity market due to default should not be allowed to happen to us here,” Usman said.

Recalled that there were rising complaints of drastic reduction in the number of hours of power supply across the four states under the franchise of the company.

Usman, however, expressed optimism that the company’s new strategy would yield desired results as both parties are committed to work together in addressing concerns raised during the town hall meeting .

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