FCMB GROUP Long Awaited Result

9 Months Report FCMB GROUP PLC
	2017 N'000	2016 N'000	change	Year End
Revenue	118,816,100	140,727,162	-16%	December
Profit/Loss before taxation	6,841,428	14,175,548	-52%
Profit/Loss for the period	5,468,945	12,981,132	-58%
Issued Shares (Units)	19,802,710,754	19,802,710,754
Basic Earnings Per Shares (Kobo)	28.00	66.00	-58%
Last total dividend paid (Kobo)

A closer look at the result shows that the company had a modest performance for the year in focus. Looking at it vis-vis last year performance would send a wrong signal because of the other income of #33.5billion that came in 2016 compare to the #5.1billion of the current year. This is a decline of 84.78% year on year.

Let us take our mind of the event of last year as it is not consistent with the operation of the Company. An x-ray of the first Nine months performance shows that in Q3 alone, the company made #2.4billion out of the #5.4billion made so far this year. This represent 44.44% of the total PAT to date. The quarter on quarter performance shows that the Company made 71.42% more than #1.4 billion it made in Q2 2017. 

It is also encouraging to note that the net impairment loss on Financial Assets declined drastically from  #34.4 billion in 2016 to #12.6% year on year. This is an improvement of around 63.48%.

FCMB Group Plc  recently notifies the Nigerian Stock Exchange (“NSE”) that FCMB Group Plc (“FCMB”) has received relevant regulatory approvals and concluded the acquisition of additional 60% stake in of Legacy Pension Managers Limited (“Legacy”). FCMB’s interest in Legacy is now 88.2%, thus making Legacy a subsidiary of FCMB. 

They further stated that the acquisition will help FCMB enhance the diversification of service offerings within the group and further optimises its holding company structure. FCMB believes that Legacy will contribute and accelerate the group’s sustained profitability as well as shareholder value. It will support and facilitate strategic initiatives that will position Legacy in the top-tier of its industry over the next 5 years.

The pension industry offer a good platform for the firm to enhance its Market value if well adapted to the Company's current operation as we have seen happened with Stanbic IBTC pension because it offers good and cheap source of Fund.

FCMB is still in line to pay 10k dividend which is consistent with their payment in the last two years considering its Nine months EPS of 28K and annualized EPS of 37K . However there may be a deviation to pay more if it surpass its performance for the last quarter of last year in terms of PAT that ended in the Negative territories.

Let me close by saying the Market reaction to the result was spontaneous as it lost 1k to close at 1.12k after the close of trading on Friday 24th November 2017. We expect better response in the coming weeks after due analysis of the result by Market participants.

We are going to deep further into the possible contribution the Legacy acquisition will bring to the table in the coming days.