Africa Prudential Plc posts N400 million Profit After Tax in Q1 2022

Africa Prudential Plc (NGX: AFRIPRUD) has posted its Unaudited Financial Statements for the period ended March 31st 2022.

It reported a Gross Earnings of N910 million and a Profit After Tax of N400 million for the first quarter period.

Commenting on the result, the Managing Director/CEO of Africa Prudential, Mr. Obong Idiong had this to day;

“We are pleased to start the year with the positive Q1 results. The recorded growth in our business is a testament to the impact of our deliberate effort at enhancing our traditional mono revenue lines to multiple income lines, innovating new ways to deliver value in an agile manner, and adopting cost efficiency in every facet of our operation.

The 212% growth in digital technology income reiterates the effectiveness of our switch to a new business model and we remain positive about the potential growth from this revenue stream in the coming quarters and long term.

As the year progresses, we remain focused on increasing shareholder’s wealth and commit to delivering
an exceptional customer experience to our expanding clientele base.”

Income Statement:

Revenue from contracts with customers: N0.45 Billion, compared to N0.36 Billion in Q1 2021 (25% YoY Growth);
Interest Income: N0.46 Billion, compared to N0.47 Billion in Q1 2021 (2% YoY Decline);
Gross Earnings: N0.91 Billion, compared to N0.83 Billion in Q1 2021 (10% YoY Growth);
Profit Before Tax: N0.55 Billion, compared to N0.48 Billion in Q1 2021 (15% YoY Growth);
Profit After Tax: N0.40 Billion, compared to N0.38 Billion in Q1 2021 (6% YoY Growth);
Earnings Per Share: 20kobo. (19kobo in Q1 2021).

Balance Sheet:

Total Assets: N17.10 Billion, compared to N15.76 Billion as at Q1 2021 (11% YoY Growth);
Total Liabilities: N8.94 Billion, compared to N6.99 Billion as at Q1 2021 (28% YoY Growth);
Shareholders’ Fund stood at N8.16 Billion, a 7% YoY decline from N8.77 Billion as at Q1 2021.

Comparing Q1 2022 to Q1 2021, we observed the following key items worthy of note:

Revenue from contracts with customers: During the period under review, revenue from contracts with customers grew significantly by 25%, driven by a 212% year-on-year growth in digital technology services despite the 60% decline in Fees from Corporate Actions.
Interest income: AFRIPRUD recorded a slight 2% year-on-year decline in interest income owing to a 4% decline in the interest on loans and advances and an 86% decline in interest on short-term deposits during the period. On the other hand, Interest earned on bonds increased 44% year-on-year, cushioning the effect of the significant decline from other interest income sources.
Total operating expenses: Despite the slight decrease in total operating expenses by 2% YoY, cost-to-income ratio reduced by 3 percentage points to 39% relative to 42% in the corresponding period.
Profit After Tax: Profit before Tax was up15% YoY, while Profit before Tax showed a 6% growth due to a higher tax charge (27% in Q1 22 relative to 20% in Q1 21).

Comparing Q1 2022 to Q1 2021, the following were observed in the Balance Sheet:

Total Assets: During the period, the book value of total assets grew 9% year-on-year driven by an 11% increase in cash and cash equivalents and a 28% increase in Trade and other receivables.
Total Liabilities: The company’s total liabilities also increased by 28% year-on-year due to a 27% growth in customers’ deposits and a 110% growth in creditors and accruals.
Shareholder’s Wealth: Due to faster growth in liabilities relative to assets, total equity declined by 7% YoY.