Net incomes of Nigeria’s most capitalised company, Dangote Cement Plc, and two of its biggest lenders, Zenith and Guaranty Trust Bank Plc (GTBank), outstripped that of the entire listed firms on the Nigerian Stock Exchange (NSE) for the full year 2018.
The three companies posted a total profit of N768.37 billion in 2018 as against an aggregate net income of N668.14 billion posted by eighty-eight (88) other companies that have so far released their 2018 financial results.
Although when companies that recorded losses in the year are ignored, the aggregate profit of the other firms would increase to N706.24 billion, indicating a N62.13 billion shortfall compared to the N768.37 recorded by the cement maker and the two lenders.
BusinessDay analysis shows that profits made by Dangote Cement, Zenith Bank and GTBank in the review year accounted for 52 percent of the entire profits of N1.47 trillion realised by all publicly-owned firms at the Lagos bourse excluding those companies that made losses to become the most profitable listed companies in the country.
The three firms’ percentage share of the entire net income realised on the NSE however increased to 53.36 percent when 23 other companies that recorded losses in 2018 are included.
This implies there was a shift in profitability dominance from the other companies on the exchange, which recorded 52 percent share of the total of N1.14 trillion realised profit in 2017 having accrued N599 billion, to Dangote Cement, Zenith Bank and GTBank in 2018. The three companies, which recorded N545 billion total profits in 2017, accounted for only 48 percent of total profit garnered in the year.
In the 2018 financial year, the Africa’s biggest cement producer grew after-tax profit by 91 percent in the year to N390 billion, making the cement giant sustain its position as the most gainful company in the country. Profit of tier-one lender, Zenith Bank, rose 11.3 percent to 193 billion, while that of Guaranty Trust Bank was up 10.5 percent to N184 billion.
Dangote Cement Plc accounts for about 30 percent of the total value of Nigeria’s stock market with its 2018 profit surpassing the total net income of 61 listed companies and accounting for more than a quarter of the total net income accrued for the year.
Nigeria’s biggest firms continued to occupy bigger shares of their respective markets as smaller entities struggle to compete with little resources, a development causing significant profit growth for the large companies with little for others.
While profits of Dangote Cement, Zenith Bank and GTBank grew by 40.97 percent from N545 billion in 2017, other listed companies only saw their aggregate net income improve by 11.5 percent to N668.14 billion from N599.34 billion.
Meanwhile, shares of Dangote Cement have returned 0.16 percent since the start of the year to close at N190 on Wednesday. The year-to-date return of GTBank stood at 1.60 percent at N34, while Zenith Bank has lost 5.42 percent of its market value this year to close at N20.40.
OLUWASEGUN OLAKOYENIKAN
