Africa Prudential posts N0.94bn Profit After Tax for H1 2022

Africa Prudential Plc (NGX: AFRIPRUD) has posted its unaudited financial statements for the period ended 30 June, 2022, reporting a Profit After Tax (PAT) of N0.94 billion for the period.

The company reported a Gross Earnings of N1.99 Billion and Profit Before Tax of N1.16 Billion. The Company delivered an Earnings Per Share of 47Kobo.

Commenting on the result, The Managing Director/CEO of Africa Prudential, Mr. Obong Idiong, had this to say:

“Our results remain a testament of the impact of our deliberate efforts at diversifying and strengthening our revenue lines to multiple income lines, innovating new ways to deliver value, and adopting cost efficiency in every facet of our operations. The 355% growth in digital technology income highlights the success of our switch to a technology-oriented business and we remain positive about the potential growth from this revenue stream in the medium to long term.

As we venture into the second half of the year, we will continue to deploy value to our customers leveraging on innovation and technology to transform their experience and increase shareholders’ wealth. ”

Income Statement:

Revenue from contracts with customers: N0.93 Billion, compared to N0.52 Billion in H1 2021 (79% YoY Growth);
Interest Income: N1.06 Billion, compared to N1.15 Billion in H1 2021 (8% YoY Decline);
Gross Earnings: N1.99 Billion, compared to N1.67 Billion in H1 2021 (19% YoY Growth);
Profit Before Tax: N1.16 Billion, compared to N0.97 Billion in H1 2021 (19% YoY Growth);
Profit After Tax: N0.94 Billion, compared to N0.83 Billion in H1 2021 (13% YoY Growth);
Earnings Per Share: 47kobo. (41kobo in H1 2021).

Balance Sheet:

Total Assets: N38.18 Billion, compared to N15.76 Billion as at FY 2021 (142% YTD Growth);
Total Liabilities: N29.49 Billion, compared to N6.99 Billion as at FY 2021 (322% YTD Growth);
Shareholders’ Fund stood at N8.69 Billion, a 1% YoY decline from N8.77 Billion as at FY 2021.

Comparing H1 2022 to H1 2021, we observed the following key items worthy of note:

Revenue from contracts with customers: We recorded a 79% year-on-year growth in Revenue from contracts with customers, driven by a 355% year-on-year growth in digital technology services despite the 9% decline in Fees from Corporate Actions.
Interest income: During the period, interest income declined 8% year-on-year on account of a 9% decline in the interest on loans and advances and a 53% decline in interest on short-term deposits during the period. On the other hand, Interest earned on bonds increased 22% year on year cushioning the effect of the significant decline from other interest income sources.
Total operating expenses: Despite the 10% increase in total operating expenses, our cost-to income ratio reduced by 4 percentage points to 43% relative to 47% in the corresponding period.
Profit After Tax: Profit before Tax showed a 19% growth, while Profit after Tax was up 13% YoY due to a higher tax charge (19% in H1 22 relative to 15% in H1 21).

Comparing H1 2022 to H1 2021, the following were observed in the Balance Sheet:

Total Assets: During the period, the book value of total assets grew 142% year-to-date driven by an 2209% increase in cash and cash equivalents and a 431% in equity instruments.
Total Liabilities: The company’s total liabilities also increased by 322% year-on-year due to a 368% growth in customers’ deposits and a 44% growth in creditors and accruals.
Shareholder’s Wealth: Due to faster growth in liabilities relative to assets, total equity declined
by 1% year-to-date.

Comparing H1 2022 to H1 2021, the following were observed in the Cash flow statement:

N23.03 billion was generated from operating activities, significantly lower than the N71.64 billion generated in the same period in 2021.
N2.90 billion was used in investing activities, this is against N3.14 billion that was generated from the activity in 2021.
N1.00 billion was used for financing activity, similar amount was used in H1 2021.
Cash and cash equivalent at the end of the period stood at N19.99BN, against N74.786 billion at the end of June 2021.

About the Company

Africa Prudential Plc was originally incorporated as UBA Registrars Ltd in March 2006. The Company subsequently changed its name to Africa Prudential Registrars Plc in August 2011 and was listed on the Nigerian Stock Exchange in January 2013.

To expand its business portfolio, the Company acquired UAC Registrars Ltd in June 2013. To enhance its market competitiveness and diversified business interests.

The Company changed its name to Africa Prudential Plc following a special resolution passed by the Members in General Meeting on March 28, 2017.

Africa Prudential Plc carries on the business of registrar and investor relation service in accordance with its Memorandum and Articles of Association. As part of its business diversification strategy, it has expanded its business activities to provision of digital solutions for businesses.

Its flagship digital solutions product known as EasyCoop is a unique software to aid the administration of cooperative societies in Nigeria and other digital business solutions.

AFRIPRUD has 2 billion outstanding shares.