Fortis Microfinance Bank PLC, the company licensed to operate as Microfinance Bank has survived the tough operating bedevilling firms in Africa largest economy and oil producer Nigeria, as 2014 earnings spiked.
For the year ended December 2014, Fortis net income increased by 76.15 percent to N674.51 million, from N382.10 million the same period of the corresponding year (FY) 2013.
Profit before tax also followed same growth trajectory as it surged by 68.66 percent to N1.07 billion, compared with N634.46 million last year.
The income brought in by Fortis property exceeds the costs of operating the property as Operating profit Margin (OER) reduced to 42.93 percent in 2014 from 59.43 percent in 2013.
The operating expense ratio measures how efficient a firm is in managing a property. A lower operating expense ratio indicates a greater profit for the investors.
Analysts say the performance of the company is stellar given the macroeconomic challenges stunting the growth of businesses in Nigeria.
These firms are finding it hard to make uptick in earnings due to poor target audience, no collateral, Lack of adequate training of staff, undercapitalization, poor internal control measures, poor asset management, liquidity problems and corruption.
Fortis’s operating expenses were down by 16.83 percent to N805.34 million, as against N968.83 million, while operating income moved by 16.87 percent to N1.87 billion.
Interest income on loans increased by 22.05 percent to N2.49 billion as the company’s continues to stride in interest on loans and advances to customers.
Net margin, measure efficiency rose to 27 percent in 2014 compared with 18.71 the previous year.
EPS increased by 78.26 percent to 41k in the period under review as against 23k in 2013.
The company is aggressive about lending as, loans to deposit jumped to 122.33 percent in 2014 as against 99.15 percent in 2013.
Loans and advances rose by 43.04 percent to N11.73 billion in 2014 compared with N8.20 billion as at December 2013. Deposits from customers were up by 15.84 percent to N9.58 billion.
Total assets increased by to 30.44 percent to N16.58 billion in 2014 as against N12.71 billion the previous year.
Return on equity (ROE) increased to 32.27 percent in 2014 from 27.10 percent in 2013. The stride in returns validates the company’s growth at the bottom line.
The Company offers a wide range of products, including loan/credit products which include Inventory Finance, Overdraft, Shop rent loan, Sharp loan and Salary advance.
Fortis share price closed at N5.42 on the floor of the NSE while market capitalization was N8.83 billion.
BALA AUGIE
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