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2023 revenue affected by Naira crisis, elections – NGX

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The Nigerian Exchange Group has said the last general elections and the naira redesign policy of the Central Bank of Nigeria impacted its top-line revenue negatively.

It said this resulted in a 20.5 per cent decline to N1.33bn in the first quarter of 2023, from Q1, 2022 revenue of N1.67bn.

This was disclosed in its unaudited results for the first quarter ended March 31, 2023.

The group said it recorded “A 14.2 per cent year-on-year decline in gross earnings to N1.56bn (Q1 2022: N1.82bn), driven by a 20.5 per cent dip in revenue following a period of high economic and socio-political uncertainty. On the other hand, other income grew by 57.7 per cent, offsetting the drop in revenue.

“The group’s top-line revenue fell by 20.5 per cent driven primarily by reduced business transactions and consumer spending that resulted from the recently concluded general election and the CBN’s attempt to phase out Nigeria’s old higher denomination of banknotes.”

According to the NGX, transaction fees, which accounted for 51.5 per cent of revenue, dropped by 30.6 per cent YoY to N685.9m (Q1 2022: N988.1 m) due to reduced business activities.

It disclosed that treasury investment income (31.1per cent of revenue) also dropped to N414.7 m in Q1 2023 (Q1 2022: N520.5m), primarily driven by relatively lower yields on the Group’s treasury investment portfolio owing to the unfavourable market conditions and uncertainties during the general election period.

However, the Group recorded a 44.6per cent listing fees growth to N179.2 m in Q1, 2023 from N123.9 m in Q1, 2022.

Growth in listing fees was driven by increased demand for listing services by domestic firms.

Also, rental income (2.7 per cent of revenue) earned from NGX Real Estate, lease of office floor spaces, recorded a 32.2 per cent increase to N36.0m in Q1, 2023 from N27.2m recorded in Q1, 2022.

Other fees representing rent of trading floor, annual charges from brokers, dealing licenses, and membership fell by 1.2per cent to N16.5m in Q1, 2023 (Q1, 2022: N16.9 m).

NGX Group’s profit before income tax expense increased by 21.5 per cent YoY to N412.2m in Q1 2023 from N339.2m in the corresponding period in 2022 due to an improved share of profit-equity accounted investees and a fall in finance cost.

Profit for the period recorded a 109.0 per cent increase to N310.0m in Q1 2023 from N148.3bn in Q1, 2022, resulting in significant growth in profit after tax margin to 23.3 per cent in Q1, 2023 from 8.9per cent recorded in Q1 202

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