RESHUFFLED PORTFOLIO PAYS OFF FOR UNITED CAPITAL PLC

In the nine months to September, United Capital PLC sold off its N2266.4m investment in associates and proceeded to restructure its investment portfolio.

Apart from realising a capital gain of N1526.1m from the sale, it liquidated its overdraft and proceeded to grow its loans and receivables by 141.7% to N74,564.1m; financial instruments held to maturity by 51% to N34971m and sprinkle N2.94m in tradeable financial instruments.

This paid off very well. Investment income more than tripled to N2612.2m; net trading income closed at N14.6m compared to N25.6m loss previously and Other income rose by 63.2% to N559.1m.

However, gross earnings ended growing by only 39.2% to N5689.4m despite these impressive growths principally because net interest income dropped by 50.3%; Other gains ended in N1.85m loss compared to N23.5m profit previously and fee and commission chipped in only 31.2% increase to N1428.7m.

Yet there was no cause for alarm. United Capital PLC stayed in good control of its costs with personnel cost dropping by 6.6% to N501.2m and operating expenses going down marginally to N1163m from N1173.6m.

In the end, the full year seems set to end well because profit before tax by September was up by 65.3% to N3962.8m making room for a far more solid 69.7% profit margin in these times.

UNITED CAPITAL PLC: Nm
                   Nine months
                         2016.           2015
Gross earnings 5689.4.    4088.4
Investment inc.2612.2.       491.5
Commission     1428.7.    1088.7
Net trading          14.6.       (25.6)
Net interest       1076.7.   2167.9
Other income      559.1.    342.6
Other gains         (1.85).     23.5
Personnel.          501.2.     536.6
Other op. Exp.   1163.0.   1173.6
Equity profit         -               83.1
Profit before tax 3962.8.  2397.4
Profit margin %  69.7.        58.6