Custodian Investment Plc said it recorded a profit jump of 111 per cent for 2020 even at a time turnover grew at a comparatively low rate of 22.2 per cent, underscoring the financial services group’s ability to cut spending in an effort to bolster profit by means other than growing revenue.
Gross earnings climbed to N75.062 billion, representing a leap of N13.645 billion when set beside the 2019 figure of N61.417 billion, its audited financial statements obtained by PREMIUM TIMES from the Nigerian Stock Exchange website on Monday showed.
However, a surge in operational expenses by more than half from N51.328 billion to N77.566 billion limited earnings.
Lagos-headquartered Custodian Investment entered a binding pact with UAC of Nigeria (UACN) Plc early in August, the first phase of the synergy between both firms allowing the acquisition of a majority stake of 51 per cent or 9,465,584,668 of the ordinary shares of UACN loss-making real estate arm, UACN Property Development Company (UPDC) Plc.
Custodian Investment will look to turn around the fortune of UPDC, which has been racking up losses for the past five years, but the financial services group’s little or no experience could cast gloom on that dream.
The deal would be worth nearly N6.365 billion if Custodian Investment were to pay the whole value of the 51 per cent holding at once on Monday at the market rate of N0.82 per each unit of UPDC shares.
The profit rise drew support from net fair value gains on the firm’s asset which increased almost thrice from N4.270 billion to N15.500 billion within a year.
Profit before tax stood at N13.686 billion, climbing up by 69.6 per cent or N5.616 billion to N13.686 billion.
Profit for the year was N12.687 billion, compared to the N6.012 billion posted in the preceding year.
Shareholders fund advanced 28.5 per cent to N57.506 billion to N44.739 billion.
Meanwhile, the Custodian Investment board Monday announced a proposal of final dividend of N0.45 per share for the 2020 financial year, having paid N0.10 interim dividend per share last year, which brings its total dividend payment for 2020 to N0.55.
That compares to the N0.45 it paid for 2019.
Shares in Custodian Investment closed trade in Lagos on Monday at N6 per share, recording no movement.
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