Oando, Others Violate NGX Post-listing Requirement, Fails to Submit 2021 FY Results

Kayode Tokede

A total of 15 companies have defaulted on the post-listing requirement of the Nigerian Exchange Limited (NGX) by falling to submit their 2021 financial year statements to investing public as required by the NGX in its post listing rules, THISDAY finding have revealed.

The 15 companies are: Rak Unity Petroleum Company Plc, Oando Plc, Medview Plc, Standard Alliance Insurance Plc, International Energy Insurance Plc, Goldlink Insurance Plc and Resort Savings & Loans Plc.

Others are:  STACO Insurance Plc, Capital Oil Plc, Smart Products Nigeria Plc, Union Homes Savings & Loans Plc, Aso Savings & Loans Plc, Deap Capital Management & Trust Plc, DN Tyre & Rubber Plc and Multi-Trex Integrated Foods Plc.

Post-listing rules at the NGX require quoted companies to submit their audited results, not later than 90 calendar days, or three months, after the expiration of the period. The rules also require quoted companies to submit an interim reports not later than 30 calendar days after the end of the relevant period.

Findings by THISDAY revealed that some of the above named companies have not submitted over four years financial statements to the bourse.

For instance, ASO Savings & Loans, Multi-Trex Integrated Foods, DN Tyre & Rubber and Union Homes Savings & Loans have failed to submitted 2014/2015 financial statements to investing public and the impact is reflected on their stock price on the NGX.

THISDAY checks revealed that most of the affected companies are faced with operational and regulatory challenges, making it difficult for them to submit their results and accounts to the Exchange.

Surprisingly, Rak Unity Petroleum Company currently has a market capitalisation of merely N16.99million, according to the NGX. Its shares outstanding stands at just 56,624,533. Rak Unity Petroleum Company has one major investor- Toparte Nigeria Limited, who controls the company.

According to information obtained from Rak Unity Petroleum’s full-year 2020 financial year result, Toparte Nigeria Limited owns a total of 48,131,159 units of shares, which amounts to about 85 per cent of the total shareholding. This leaves other investors (including the investing public), with just 8,493,734 units of shares (15per cent).

The adverse effect of this situation is that the company’s stock lacks liquidity. The absence of free float, therefore, makes it impossible to trade the stock. Since 2015, its share price has declined from N0.50 to N0.30. Liquidity is still almost non-existent, and no one seems to be buying or selling the stock, despite the rather consistent dividend payments the company continues to dole out. The petroleum marketing company suffered slow revenue in 2020 and led to a loss of about N64.2million in 2020 from a loss of N39.78million in 2019. 

For Medview Airline, the company had in 2018 had suspended international flight operations due to debts and decreased aircraft, and by August 2019 Medview reportedly shut down all operations as its only operating aircraft went out of service. The airline stock on the floor of the NGX has remained flat at N1.62 per share for over three years.

As at October 21, 2022, data obtained from the local bourse showed that the company recorded 0 trade and 0 volume within the period under review.

Also, the airline has been among companies listed on the NGX’s free float deficiencies of 14.16 per cent.

The Chairman of the airline, Sheik Abdul-Mosheen Al-Thunayan, blamed the performance on political tension and tight liquidity.

He said, “The political tension and extremely tight market liquidity in Nigeria affected the economic growth of Med-View. The depleted aircraft fleet, due to C-Check at the early part of 2018 and reprotection exercise, also contributed to the decline in the revenue of the Company.”

Also, Oando with about N55.8billion in market capitalisation as of October 21, 2022 on NGX had entered an arrangement with Securities and Exchange Commission (SEC) to settle all matters subject of litigation, among others.

The indigenous petroleum company on the NGX recently had its audited 20018 Annual General Meeting (AGM) and the 2019 audited results was released to the investing public.

Oando had reported N207.08billion loss in 2019 from N28.8billion profit in 2018, attributable to slow revenue from contracts with customers and a significant increase in Impairment of non-financial assets.

The company has submitted an unaudited 2020 financial year statement as capital market stakeholders await 2021 financial year statement.  

Meanwhile, leading shareholders’ rights activist are making efforts to reach out to the companies to know how they can better navigate the situation.

In a chat with THISDAY, the Chairman, of Progressive Shareholders Association of Nigeria, Boniface Okezie, said “shareholders have been communicating with most of these companies and the feedback is always the same. Is either they have not gotten approval from SEC or we are working on it. There is nothing shareholders can do but wait until audited results are released.

“I think hosting the AGM is one of the things that occupy the minds of Oando’s management. I am not aware if the management had applied for an extension of releasing those results. There is nothing wrong with these companies informing shareholders of their internal crisis. They should not stay away from shareholders because we have investments in these companies. I am appealing to most of these companies to comply with Exchange post-listing requirement and host AGM.”

The Vice President, Highcap Securities Limited, Mr. David Adnori also said the late filing of results and accounts by the 15 companies reflected on their stock prices.

He urged the companies to carry stakeholders along and find a lasting solution to one of the post-listing requirements of the Exchange. 

THISDAY also gathered that some of these companies are undergoing restructuring, while some are about to delist from the Exchange.

However, the Exchange has approved for NGX RegCo to proceed with the delisting process of The Tourist Company of Nigeria, Union Homes Savings & Loans, and ASO Savings and Loans.

 Also, the bourse has placed Deap Capital Management & Trust and Multi-Trex Integrated Foods on the delisting watch list.

Goldlink Insurance, International Energy Insurance, DN Tyre & Rubber are currently undergoing restructuring on the Exchange.