Nigeria: 98 Companies Weather Covid-19 Impact, Post N6.1trn Turnover

Nigeria: 98 Companies Weather Covid-19 Impact, Post N6.1trn Turnover

The 98 leading companies on the Nigerian Exchange Limited, NGX have recorded combined turnover of N6.1trillion in the first half of 2021, H1’21.

The companies’ H1’21 combined turnover was 17.57 per cent more than the N5.2 trillion recorded in the same period in H1’20.

Financial Vanguard findings from the financial reports they turned over to the NGX for the period under review showed that the companies posted 29.3 per cent increase in pre-tax profit to N1.275 trillion in H1’21 as against the N986.572 billion in H1’20.

The topline and bottomline performance indicate that the corporate world may have shaken off the adverse impact of the COVID-19. It would be recalled that Nigeria, alongside other countries in the world, went into recession last year following the effects of the restrictions to movement and economic activities implemented across the country in early second quarter, Q2’20 of the year in response to the COVID-19 pandemic.

However, the government launched some stimulus interventions meant to curtail the impact of the pandemic on businesses and individuals. The impact of this stimulus, analysts stated, have started reflecting in the companies’ performance and hoped it would be sustained barring unforeseen circumstances.

Meanwhile, though the banking sector topped the performance chart contributing the highest volume of both topline and bottomline, the sector recorded mixed financial performance for the first half 2021, H1’21.

Banking sector analysis

Financial results of leading banks show that the combined turnover grew marginally by 2.8 per cent to N2.575 trillion from N2.505 trillion recorded in the corresponding period of H1’20. This gives a significant under-performance against the 5.01per cent recorded as the Gross Domestic Product, GDP, growth.

However, the banks recorded positive performance in Profit Before Tax, PBT, which grew by 6.5 per cent to N573.7 billion in H1’21 from N545.7 billion in H1’20, but inflation at 17.75 per cent in HI’21 has put pressure of the profit growth rate.

Meanwhile, analysts have stated that the mixed H1’21 performance was attributable to a combination of factors such as Naira depreciation and rise in cost as they resume full on-site operations unlike last year when most of the staff worked from home.

They further noted that tier-2 banks were relatively better in terms of profit, especially Wema Bank, Unity Bank and Jaiz Bank, an indication that tier-2 banks are navigating the challenges of macroeconomic environment more efficiently.Industrial Goods sectorThe Industrial Goods sector recorded higher growth rates than the banking sector.Specifically, the 11 companies in […]

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