17 Nov

Daily Watch – FG to focus on raising non-oil revenue, IPPs more profitable than DISCOs

  • New Minister of Finance, Kemi Adeosun, has said the Federal Government will henceforth focus on raising non-oil revenues. She told the Financial Times that stricter enforcement of earnings collection from federal agencies and more diligent bookkeeping were the types of “micro” issues her ministry would focus on to mitigate the effects of crude prices that have remained below $50 a barrel.
  • Aliko Dangote, Africa’s richest man, and three other directors resigned from the board of Dangote Flour Mills on Monday as majority owner, Tiger Brands, cut funding support to its flailing Nigerian division. South Africa’s Tiger Brands said it was “currently exploring various alternatives” with regard to its investment in Dangote Flour Mills, which also announced a change of name to Tiger Branded Consumer Goods. Dangote holds 10 per cent of the company’s equity through Dangote Industries. The other directors who resigned are Olakunle Alake, Asue Ighodalo and Arnold Ekpe.
  • According to Agusto, the Nigerian ratings company, grid connected Independent Power Producers are more profitable than their PHCN successor counterparts. But despite relatively good margins, the industry remains constrained by inadequate cash flow. A majority of industry operators, particularly the PHCN successor distribution companies have been unable to generate sufficient cash flows to cover their mandatory obligations to the market operator and GenCos since the take-over of the companies in November 2013 due to the poor billing and cash collection systems.