Amidst Economic Woes, Seplat, MTN, Others Pays N167.5bn Interim Dividend in H1

Kayode Tokede

Following robust profits despite macro economic challenges, a total of seven companies on the Nigerian Exchange Limited (NGX) have declared a sum of N167.5billion as interim dividend for half year (H1) ended June 30, 2022.   

This is an increase of 30 per cent from N128.85 billion interim dividend reported in the corresponding half of 2021.

The seven companies consist of MTN Nigeria Plc, Seplat Petroleum Plc, Zenith Bank Plc, Guaranty Trust Holding Company Plc (GTCO), Stanbic IBTC Holdings Plc, Fidelity Bank Plc, and Okomu Oil Palm Company Plc.

The seven companies in H1 2022 declared a combined profit after tax of N476.86 billion as against N392.86 billion reported in H1 2021. 

With about 28.1 per cent rise in profit after tax to N181.63 billion in H1 2022, MTN Nigeria lead other listed companies on the NGX with the highest interim dividend payout to shareholders in the period, followed by Stanbic IBTC Holdings and Zenith Bank.

Interestedly, Fidelity Bank for the first time joined the list of banks to declare interim dividend in H1 2022.  

In the period under review, MTN Nigeria declared N113.98 billion, representing N5.60 per share to paid out of distributable net income to shareholders as against N91.6 billion, representing N4.50 per share paid to shareholders in H1 2021. 

The CEO, MTN Nigeria, Karl Toriola in a statement noted that, “during the first half of 2022, we made good progress in strengthening the resilience of the business in the face of our increasingly challenging operating environment with rising energy, food, and general inflation putting pressure on consumer spending.

“The conflict in Ukraine as well as the implementation of a ‘zero-COVID’ policy in China, has also put a strain on global supply chains. To mitigate global supply chain and exchange rate risks, we accelerated capital expenditure for network expansion into the H1 2022.”

Similarly, Stanbic IBTC Holdings in H1 2022 declared an interim dividend of N19.44 billion in H1 2022 from N12.96 billion in H1 2021 on the backdrop of impressive corporate earnings in the period under review.

For Seplat Petroleum, its interim dividend moved from N6.05 billion in H1 2021 to N6.25 billion in H1 2022 when it declared an interim dividend of US2.5cents per ordinary share of N0.50k each for the consecutive year.

The indigenous petroleum marketing company had informed shareholders of the exchange rate of 1 N424.83/ Dollar in H1 2022 as against N411.14/Dollar in H1 2021. 

Zenith Bank and GTCO declared N9.42billion and N8.83billion interim dividend for the second consecutive half year ended June 30, 2022, while Fidelity Bank declared N2.9billion as interim dividend in the period under review.

MD/CEO of Fidelity Bank, Nneka Onyeali-Ikpe stated that, “We are delighted with our H1 2022 performance which showed strong growth across key performance indices.

“With improved efficiency and customer experience around our network, customer transactions have grown considerably as we optimize our balance sheet and build up a large stock of stable low-cost deposits.”

In addition, Okomu Oil Palm Company announced an interim dividend of N7 per 50 kobo ordinary shares to its shareholders, translating into N6.68billion. 

Okomu oil released its financial report that shows that the company delivered a massive profit of N16.8 billion in H1 2022, 76.6 per cent higher than the N9.5 billion profit in the same period last year. The turnover also spiked significantly by 72.5 per cent from N23.6 billion in H1 2021 to N40.8 billion in the H1 2022.

Capital market stakeholders attributed the increasing interim dividend payout to the steady increase in business activities post-covid-19, stressing that companies operating in Nigeria have maintained stronger fundamentals amid the worst foreign exchange crises, among others.   

Speaking with THISDAY, the Chairman, Progressive Shareholders Association of Nigeria, Boniface Okezie commended MTN Nigeria, and others for interim dividend payout to shareholders, stressing that these companies stand out despite economic challenges.

According to him, “These companies have shown resilience despite domestic and global economic challenges. They have consistently declared interim dividend as their policy to reward shareholders and we are delighted.

“Fidelity Bank interim dividend for the first time in over 30 years is a welcome development. The declaration of interim dividend by the management of Fidelity bank showed the growth of the bank and it is poised to become a Tier-1 bank  in Nigeria.”  

The Chief operating officer of InvestData Consulting Limited, Mr. Ambrose Omordion, said, “It is a good development for seven companies to declare over N160billion interim dividend in H1 2022.

“Their performance showed these companies remained strong post-covid-19 pandemic era and it good for our domestic market.

“We have seen stronger earnings and assets for companies on the Exchange. The banking sector has remained consistent in dividend payout to shareholders and Fidelity Bank joined the league.”

He noted that interim dividend is another source for investors to make money in the capital market, calling on pensioners, among others to take advantage of the capital market and invest in fundamental stocks that consistently pay dividend shareholders.

CEO, Wyoming Capital & Partners, Mr. Tajudeen Olayinka stated that Zenith Bank, among others, are simply keeping up with traditions of paying shareholders’ a dividend.

He added that, “It is also evidence of good showing in the first half of the year by those companies and some other listed companies that may not be paying an interim dividend.”