The Report: Nigeria 2016 | Oxford Business Group

November 20, 2016 5:53 am Nigerian Capital Markets

Share analysis of major firms on the local bourse

 

Banking and financial services.

The United Bank for Africa (UBA) is one of the largest financial services groups in sub-Saharan Africa. It is the third-largest bank in Nigeria with an estimated market share of 10%. The bank has a presence in 19 African countries, as well as in the UK, the US and France. Among Nigerian banks, it is the most diversified in terms of its reach across Africa. It serves over 8m customers through its more than 600 office locations. Three-quarters of UBA’s gross earnings are derived from its pan-African exposure. The bank’s risk appetite can be described as moderate. Its loan book is well diversified with a non-performing-loan (NPL) ratio of less than 2% as of the end of 2015, a cost of risk of 0.4% and a coverage ratio of 130%.



Source: Oxford Business Group, The Report, Nigeria 2016. Share analysis and data provided by FBNQuest.

Access the full report with additional analysis on financial performance, development strategy
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Food and beverages

Nigerian Breweries (NB) was incorporated in 1946 and opened its Lagos Brewery in 1949. The company has since established other breweries in Aba, Kaduna, Ibadan and Ameke, with the facility at Ameke regarded as the largest brewery in the country. In 2011 NB acquired Sona Systems Associates Business Management and Life Breweries from Heineken. This followed Heineken’s acquisition of controlling interests in five breweries in Nigeria from Sona Group in January 2011. In 2014 the company received approval from the Securities and Exchange Commission and the respective shareholders of NB and Consolidated Breweries to merge the operations of both firms. The merger became final on December 31, 2014. Following the successful merger, the company added three additional breweries in Ijebu-Ode in Ogun State, AwoOmamma in Imo State and Makurdi in Benue State. The merger also brought another seven brands into NB’s portfolio. Today, the company has 11 breweries, two malting plants and 26 sales depots.



Source: Oxford Business Group, The Report, Nigeria 2016. Share analysis and data provided by FBNQuest.

Access the full report with additional analysis on financial performance, development strategy CLICK HERE

 

Construction materials

Dangote Cement’s (DanCem) foray into cement manufacturing started in 2000, with its acquisition of the federal government’s equity stake in the Benue Cement Company. With investments in excess of $5bn, DanCem’s rise to the top has transformed the industry, taking the sector’s installed capacity in Nigeria from around 4.8m tonnes in 2000 to over 38.1m tonnes currently. DanCem is expanding its footprint across Africa, with recently opened plants in Cameroon, Ethiopia, South Africa, Tanzania and Zambia. While these expansions have taken DanCem’s installed capacity to about 43.3m tonnes, further investments across the continent are set to increase this to over 74m tonnes by 2019. DanCem is the largest listed entity on the Nigerian Stock Exchange with a market capitalisation of $11.4bn.



Source: Oxford Business Group, The Report, Nigeria 2016. Share analysis and data provided by FBNQuest.

Access the full report with additional analysis on financial performance, development strategy CLICK HERE

 

Agro-Industry

Okomu Oil Palm Company is one of the top-two palm oil producers in Nigeria, having commenced agricultural production in 1979. Located in Benin City in Edo State, Okomu has gone from solely producing fresh fruit bunches to crude palm oil (CPO). In addition, it fully kicked off rubber production in 2008. With a total plantation area of over 18,000 ha, Okomu had an output of around 43,000 tonnes of palm oil and 7600 tonnes of rubber in 2015. Okomu also benefits from the management and experience provided by its main shareholder and technical partner, Belgian firm SOCFIN, which has a 62% stake in the company.

Palm oil consumption in Nigeria currently outstrips domestic supply. As such, the country relies on imports of up to 500,000 tonnes versus demand of 1.5m tonnes. The Nigerian palm oil industry is fragmented, with the biggest producers, Okomu and Presco, accounting for just 7% of production in the country. Due to dwindling reserves and the need to encourage local production, in 2015 the Central Bank of Nigeria (CBN) banned the sale of foreign exchange via the official window to palm oil importers. This should result in a gradual increase in the price of locally produced palm oil.
 



Source: Oxford Business Group, The Report, Nigeria 2016. Share analysis and data provided by FBNQuest.

Access the full report with additional analysis on financial performance, development strategy CLICK HERE

 

Healthcare and personal goods

PZ Cussons Nigeria (PZ) is the largest subsidiary of the global PZ Cussons group, accounting for around 40% of international sales. The company has enjoyed tremendous success in Nigeria and is among the largest firms in the fast-moving consumer goods sector. PZ operates in four segments: personal care, home care, food and nutrition, and electrical goods. Additionally, it is a significant player in West Africa, supported by a supply chain and distribution network that enables PZ to launch new products at affordable prices.




Source: Oxford Business Group, The Report, Nigeria 2016. Share analysis and data provided by FBNQuest.

Access the full report with additional analysis on financial performance, development strategy CLICK HERE

 

Conglomerate

UAC of Nigeria (UACN) is a leading conglomerate, operating in the food and beverages, real estate, paints and logistics sectors. UACN’s business portfolio includes UACN Property Development Company (UPDC); UAC Foods, a joint venture with Tiger Brands; MDS Logistics, which has investments in the development of pharmaceutical distribution hubs in key locations across the country; UAC Restaurants, a joint venture with Famous Brands; Chemical and Allied Products (CAP); Grand Cereals, a leader in animal feeds and edible oils; Warm Spring Waters Nigeria; and UNICO CPFA, a closed pension fund administrator. The firm’s business expansion drive led to the 2013 acquisition of a 51% share in Livestock Feeds and Portland Paints and Products Nigeria.




Source: Oxford Business Group, The Report, Nigeria 2016. Share analysis and data provided by FBNQuest.

Access the full report with additional analysis on financial performance, development strategy CLICK HERE

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