The Afrinvest weekly sentiments indicator strengthened to 1.9x from 1.8x in the previous week. This week, We expect to see some bargain hunting in early trades as investors seek to take position in bellwethers that have fallen to attractive entry prices. However, we believe the negative performance will be sustained in the absence of a positive catalyst.
In our Insurance Sector report 2020 (“Recapitalisation – Launching into the Deep”), we highlighted the global insurance sector performance in 2019. The sector premiums reached $6.3tn in 2019 after scaling the $5.0tn mark in 2018 as the non-life segment surpassed forecast and reported a 3.5% growth in premiums to $3.4tn while the life segment premiums also increased 2.2% to $2.9bn mainly due to a recovery in China. Sigma research had expected both non-life and life premiums to contract by 1.0% and 1.5% respectively in 2020 similar to that of the Global Financial Crisis (GFC) in 2008 due to the effects of the pandemic on the insurance business.
Save for ACCESS and ETI, our coverage banks experienced contractions in interest income in Q1’21, mostly in line with the 161bps moderation in average T-bill rates to 1.3%. In addition, 66.7% of the banks recorded pullbacks in the P&L line item even though the balance of their interest- earning investment securities was notably higher in the quarter...
Nigerian Breweries (NB) Plc consolidated its Q4 2020 performance in Q1 2021, signaling a new normal. Having grappled with the impact of the strain in household income and the halt in on-trading activities, Revenue growth was slow, up only 4.3% y/y in FY 2020. As of Q1 2021, however, Revenue grew significantly, up 27.0% y/y t0 N105.68bn. Similarly, and defying the general rise in cost and expense lines, Profit After Tax was up 38.6% y/y to N7.66bn in the period.
Following the two consecutive weeks of gains, the NSE saw some profit taking, halting the bullish streak to close at 38,324.0 points while market capitalization settled at N19.9bn in the past week, representing a 2.9% w/w decline. As a result, YTD loss worsened to 4.8%. Activity level weakened during the week, as average volume and average volume traded declined by 33.3% and 45.0% w/w to close at 209.1m units and N3.2bn, respectively.
In Q1 2021, Lafarge Africa reported a 12.2% y/y increase in Revenue to N71.5bn, driven by Cement Sales (up 12.3% y/y to N69.9bn) and Aggregates & Concrete (up 7.9% y/y to N1.6bn). Supported by controlled Opex (-16.3% y/y) and steep decline in Finance Cost (-18.2% y/y), Profit Before Tax rose to N12.8bn in Q1 2021, up 36.1% y/y from N9.4bn in Q1 2020. Thus, Net Income grew by 13.3% y/y to N9.1bn in Q1 2021 from N8.1bn in Q1 2020. EPS rose to N0.57/s in Q1 2021 (Q1 2020; N0.50/s).
