Africa Prudential Plc announced its Unaudited Financial Statements for the period ended September 30th 2020, with a Gross Earnings of N2.63 Billion and Profit Before Tax of N0.42 Billion. The Company delivered an Earnings Per Share of 71Kobo.
Commenting on the result, The Managing Director/CEO of Africa Prudential, Mr. Obong Idiong, had this to say:
“While the negative economic impact of the Covid-19 continues to reflect on our traditional income lines, the transition of the company from a traditional Registrar Business to a technology business deploying technology to transform the Registrar, Cooperative, E-Commerce, and Digital Technology play could not have come at a better time. We are confident that as the Company’s new businesses continue to gather momentum, we will continue to deliver sustainable value to our investors.”
“Among the gradual result of the transformation process is the 263% year-on-year growth in Digital Technology Consultancy income. We also grew our investment income by 6% year-on-year through and the efficient allocation of investmentible fund despite the prevailing low-interest rate regime.”
“We will continue to consolidate on our gains in the digital technology space to deliver great value and exceptional experience to clients across all our touch points.”
A year-on-year comparison between Q3 2020 and Q3 2019 reveals the following:
- Revenue from contracts with customers: N0.86 Billion, compared to N1.22 Billion in Q3 2019 (30% YoY Decline);
- Interest Income: N1.77 Billion, compared to N1.67 Billion in Q3 2019 (6% YoY Increase);
- Gross Earnings: N2.63 Billion, compared to N2.90 Billion in Q3 2019 (9% YoY Decline);
- Profit Before Tax: N1.57 Billion, compared to N1.76 Billion in HY 2019 (11% YoY Decline);
- Profit After Tax: N1.41 Billion, compared to N1.50 Billion in Q3 2019 (6% YoY Decline);
- Earnings Per Share: 71kobo, compared to 75kobo in Q3 2019.
Balance Sheet:
- Total Assets: N19.38 Billion, compared to N18.65Billion as at FY 2019 (3.9% YTD Growth);
- Total Liabilities: N11.11 Billion, compared to N10.37 Billion as at FY 2019 (7.2% YTD Increase);
- Shareholders’ Fund stood at N8.27 Billion, marginally declining by 0.2% YoY from N8.28 Billion as at FY 2019.
Comparing Q3 2020 to Q3 2019, we observed the following key items worthy of note:
- Revenue from contracts with customers: During the third quarter of the year 2020, the company’s fees from corporate actions grew by 25.79%, register maintenance grew by 47.49% and revenue from digital technology consultancy significantly increased by 264.63% year-on-year. However, there was a revenue decline from a fee from contracts by 30% year on year due to the impact of covid19 on our key clients which resulted in renegotiation and repricing.
- Interest income: Despite the poor yield environment, Africa Prudential’s interest income increased by 6% year-on-year. This increase was fueled by 19.83% increase in interest income on loans and advances and a 780% increase in interest income on bonds. The total increase in interest income was achieved despite 45.94% reduction in interest income on treasury bills and 87.95% reduction in interest income on short-term deposits.
- Profit After Tax: Overall, the profit after tax of Africa Prudential declined by 6% in Q3 2020. This result was on the back of the 29.61% reduction in revenue from contracts with customers, 5.4% reduction in other income, 3.4% increase in personnel expenses, and 17.2% increase in amortization of intangible assets.
Comparing Q3 2020 to FY 2019, the following were observed in the Balance Sheet:
- Total Assets: Africa Prudential’s total assets during the period under review grew by 3.9% year-to-date on the account of a 7.3% rise in its debt instruments assets computed at amortised cost, 141.0% rise in trade and other receivables and 13.6% surge in intangible assets during the year.
- Total Liabilities: The company’s total liabilities increased by 7.2% year-to-date, owing to 5.3% increase in its customer’s deposits and 2,106.8% rise in creditors and accruals owing to withholding tax payable on client dividend.
- Shareholder’s Wealth: Due to 121.9% increase in fair value reserve, the Shareholder’s wealth mildly declined by 0.2% year-to-date.