Afribank set to beat PO forecast on profits & returns

Afribank set to beat PO forecast on profits & returns

November 15, 2007



Strong indications on the prospects of Afribank Nigeria Plc performing well above its Public Offer financial forecast have started to emerge. The Bank, in its Public Offer Prospectus, among others forecast, projected a N12.07 billion Profit Before Tax (PBT) for the 2008 Financial Year.


But the Bank’s N8.10 billion PBT half year results released two weeks ago as against N2.83 billion in corresponding period in 2006, has put the Bank on the fast lane to beat Public Offer projections.


The Bank’s half year’s Gross earnings also went up to N19.48 billion as against N9.65 billion in 2006 which, if sustained, the Bank would realize about N40 billion, 8% up from the Offer projections of N37.51billion.


Market analysts believe that if Afribank could sustain its growth rate, it would record at least N16billion PBT by the end of its current financial year, 31st March 2007. This is over 33% above the projected forecast of N12.07 billion.


Analysts also praised Afribank’s strategy on the allocation of Offer proceeds which they believe would enhance its market competitiveness and boost its performance outlook. The total Offer proceeds of N94,121,755,000.00 is allocated thus: working capital 49%, branch network expansion 27%, ICT upgrade 10%, strategic business roll out 8% and increase in equity in subsidiaries  6%.


They also hold the view that going by the friendly reward system of the Bank, shareholders of the bank should be expecting above offer projections returns on their investment.


The Management of Afribank, Mr. Sebastian Adigwe, assured that the Bank’s solid structure and operational models are strong enough to optimize to opportunities, deliver on promises and open up more business avenues for the Bank.


Management of the Bank stated that the Bank would grow organically from the allocations of the Offer proceeds because “the allocations cover practically all aspects of our business plan and they are in line with the five-year strategic growth plan of the Bank which is already delivering resultsâ€ÂÂÂÂÂ.


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