NGX Group releases unaudited results for half year 2023 with PAT of N444.1 million

The Nigerian exchange group (NGX Group) has released its unaudited results for half year 2023. below are the major highlights of the results which shows a profit after tax (PAT) of N441.1 million and profit after tax margin of 12.03%

• Gross earnings fell 12.5% to N3,690.3 billion from N4,215.7 billion as of June 2022,, while other income climbed 24.9% to N490 million from N393 million in the same period.
• Revenue fell 16.3% to N3.2 billion in June 2023, from N3.82 billion in June 2022. This was due to a 6% fall in treasury investment income (27.1% of revenue) to N869 million in June 2023 compared to N1,017.4 million in the comparable month in 2022, principally due to a year-over-year reduction in our treasury holdings.
• Due to a decrease in trading operations at Nigerian Exchange Limited (“NGX” or “The Exchange”), transaction fees (57.2% of income) fell by 2% to N1,830 million in June 2023 from N2,320.7 million in June 2022.
• Listing fees increased by 7% (12.1% of revenue) to N388.1 million in June 2023 from N363.8 million in June 2022, boosted by improved listing on the Exchange in the first half of 2023 compared to the first half of 2022.
• The rental income (2.2% of revenue) earned by NGX Real Estate from the lease of office floor spaces increased by 38.6% from N8 million in June 2022 to N71.7 million in June 2023.
• Other fees (1.3% of revenue) fell by 5% in June 2023 to N42.1 million from N69.7 million in June 2022, representing rental income from the trading floor, annual charges from brokers, dealing license, and membership fees obtained by the Group.
• The 9% increase in other income (13.3% of gross earnings) was principally driven by: a 3% increase in market data income (59% of other income) to N287.98 million from N220.94 million in June 2022, which is comprised of technology income, other sub-lease income, and penalty fees.
• Other operational income will increase by 4% (31% of total income) from N122.5 million in June 2022 to N149.9 million in June 2023.
• Total expenses increased by 0.4% from N60 billion in June 2022 to N2.61 billion in June 2023, owing mostly to a 3.7% increase in operational expenses (39.3% of total expenses) to N1.02 billion from N991.2 million in June 2022. This was mitigated by a N1.21 billion decrease in finance costs (46% of total expenses) connected to a term loan facility. Personnel spending (53.9% of total expenses) increased by 4.1% during the review period, from N1.35 billion in June 2022 to N1.41 billion.
• As a result of the 16.3% decrease in revenue year on year, operating profit fell by 3% to N1,076 million in June 2023 from N1,613.1 million in June 2022.
• Profit before income tax fell by 40.6% to N726 million in June 2023 from N1,223.2 million in the same month in 2022, owing to a decrease in top line YoY.
• Profit after tax fell 45.9% to N444.1 million from N820.2 million. This resulted in a drop in profit after tax margin to 12.03% from 19.45% in June 2022.
• Total assets fell 3.7% to N94 billion in December 2022 from N57.06 billion in December 2022, primarily due to a 33.1% decrease in Trade and other receivables to N712.86 million from N1,065 million in December 2022, and moderated by a 5.31% increase in Cash and Cash equivalent to N5 billion from N4.75 billion in December 2022.
• Total liabilities decreased by 12.3%, from N20.3 billion in December 2022 to N17.8 billion in December 2023. The repayment of a term loan used to support investments in selected associates was principally responsible for this decline.

Commenting on the results, Mr. Oscar N. Onyema (OON), Group Managing Director/Chief Executive Officer, said:

“While our fiscal year 2023 half-year results may reflect the impact of economic headwinds, NGX Group demonstrated resilience by recording a profit before tax of N0.7 billion.” We are optimistic that, with the incoming government’s market-friendly statements now in place, trade and listing operations will maintain the good impact seen in June 2023. In keeping with our strategic goal of increasing shareholder value, the Board of Directors has approved an interim dividend of N0.25 Kobo per ordinary share of 50 Kobo. This amounts to N495,532,893 (four hundred and ninety-five million, five hundred and thirty-two thousand, eight hundred and ninety-three Naira). This strategy emphasizes improved dividend flow through from an associate company and first-time dividend payment from our flagship subsidiary. It also underlines our ongoing commitment to collaborating with our shareholders and other stakeholders in creating and distributing value, even in difficult market conditions.”