- The CPI maintained its upward streak at the weekend, rising to 17.9 percent in September from 17.6 percent in the previous month. The NBS attributed the 0.24 percent rise in the headline number to increases in the food index as well as energy prices. Increases were recorded in all subdivisions, with, Communication and Restaurants and Hotels reported to have recorded the lowest rates of increase of the 12 divisions, growing by 5.6 percent and 9.6 percent respectively. The Food sub-index increased by 16.6 percent (year-on-year) in September, up by 0.19 percent points from rate recorded in August (16.4 percent). According to the NBS, “Energy and energy-related prices continue to be the largest increases reflected in the core sub-index. In September, the core sub-index increased by 17.7 percent during the month, up by 0.5 percent points from rates recorded in August (17.2 per cent). During the month, the highest increases were seen in the Electricity, Liquid Fuel (kerosene), Solid Fuels, and Fuels and Lubricants for personal transport equipment groups.”
- The country’s external reserves have hit an 11-year low of $24.21 billion, according to the latest CBN data. The development means a limited amount of dollars will be available at the official interbank spot market, fuelling concerns over another round of depreciation of the naira. The country’s external reserves had depleted to a then record-low of $24.8bn about two weeks ago. The foreign exchange reserves fell by $600 million in two weeks before shedding $1 billion in four weeks, the CBN statistics showed. Specifically, the reserves fell from $25.8 billion on August 16 to $24.8 billion on September 16. It decreased by $600 million from the $25.4 billion recorded on August 31 to $24.8 billion on September 16. The spate of decline in the external reserves follows the CBN’s almost daily interventions at the interbank market in recent weeks, as chronic dollar shortages continue to weigh on the economy. The naira had fallen to an all-time low of ₦365.25/$ at the interbank market on August 18 before making a gradual recovery. On Friday, the local currency closed at ₦305/$, while closing at ₦460/$ at the parallel market on the same day.
- MAN has described the CBN directive of directing 60 percent foreign exchange allocation to Nigerian manufacturers as a hoax. A little over two months ago, the regulator had directed commercial banks and other authorised dealers in the forex market to ensure that they allocate 60 percent of total FX purchases from all sources (interbank inclusive) to manufacturers strictly for the purpose of importation of raw materials, plant and machinery. According to MAN President, Frank Jacobs said: “As far as I am concerned, it hasn’t worked. Our members have not benefited from it. I came close to calling it a hoax in the sense that it was something they dangled on our face without substance,” he said.
- Forte Oil has reported a profit after tax of ₦2.8 billion for the nine months ended September 30, 2016, a decline of 34.7 percent compared to ₦4.3 billion in the corresponding period in 2015. Although the company’s top lines showed growths, higher cost of finance and tax expenses compressed the bottom line. The integrated oil company recorded a gross revenue of ₦121.1 billion in 2016, showing an increase of 32.2 percent from ₦91.6 billion in 2015. Cost of sale rose by 34.3 percent from ₦78.6 billion to ₦105 billion, while profit before tax stood at ₦15.5 billion, an increase of 19.4 percent. The company was able to keep operating expenses flat at ₦9.9 billion, against ₦10 billion in 2015 while other income fell by 13.9 per cent from ₦2.7 billion to ₦2.3 billion and net finance cost soared by 663 per cent to ₦2.2 billion. Consequently, the company ended the nine months with profit before tax (PBT) of ₦5.6 billion, from ₦5.3 billion in 2015. However, tax expenses rose by 182.6 percent from ₦1.0 billion to ₦2.8 billion, depressing its PAT collection. Group Chief Executive Officer, Akin Akinfemiwa attributed the H1 performance to aggressive sale drive, strategic retail acquisition, and prudent approach to cost containment.
- Dangote Industries on Sunday announced the acquisition of Twister BV, a Dutch company as part of its strategy to meet Nigeria’s gas needs. According to a statement by Dangote, Twister BV provides robust solutions in natural gas processing and separation to the upstream and midstream oil and gas sectors. It said Twister’s separation capabilities were designed to augment production and streamline processes to capitalise on high-yield gas processing for maximising revenues. Twister BV used to be owned by Shell Technology Ventures Fund 1 before its recent acquisition by DIL and its partner, First E&P. According to the statement, based on sophisticated patented technology, Twister gas plants are typically cheaper to build and operate, compared to alternative technologies, and deliver better performance levels. The company has customers in Nigeria, Malaysia and South America.