United Bank for Africa (UBA) Plc has released its audited 2016 full year results showing an impressive 32 per cent growth in profit before tax to N91 billion.
As reflected in the results released on March 24, 2017 at the Nigerian Stock Exchange (NSE) covering the period January to December 2016, the figure showed an improvement from N68b profit recorded over the same period of 2015.
The group recorded an impressive 22 percent growth in gross earnings to N384 billion, as at December 2016, from N315 billion at the end of the 2015 financial year, illustrating the bank’s ability to grow profitability despite the difficult macro-economic environment.
Following the impressive performance, the board of directors proposed a final dividend of 55k, subject to the approval of the shareholders at the forthcoming annual general meeting, scheduled for April 7, 2017.
The bank had earlier paid an interim dividend of 20k to shareholders, bringing the total dividend for the 2016 financial year to N0.75, an unprecedented yield of 13.9 per cent, based on the stock’s unit price of N5.39 on the floor of the NSE.
The results and dividend proposal justify investor confidence in the Bank, as reflected in the 20 per cent year-to-date rally in the share price, compared to the overall market loss of 5 per cent over the same period.
UBA’s profit after tax grew by 22 per cent to N72b, from N60b recorded the previous year. The performance was buoyed by considerable growth in interest and non-interest income, as well as increasing efficiency gains from cost management initiatives.
UBA’s subsidiaries outside of Nigeria are increasingly gaining market share, reinforcing the strong and impressive subsidiary contribution to the Group, estimated at one-third of profit in 2016, from a quarter in 2015 financial year.
The bank’s managing director and chief executive officer, Mr. Kennedy Uzoka attributed the significant growth in gross earnings and profits to the bank’s resilience, enhanced productivity and geographic diversification, evident in the impressive contribution from its African subsidiaries.
Uzoka expressed satisfaction at the resilience of the bank, despite the macroeconomic challenges in a number of countries where UBA operates.
“Given the operating environment in 2016, I am very pleased with our profitability – an impressive 32 per cent growth in profit before tax to N91 billion – whilst we have also focused keenly on operational efficiencies, illustrated by the reduction in our cost-to-income ratio,” Uzoka said.
Speaking on his outlook for the 2017 financial year, Uzoka expressed optimism, as the bank’s pan-African operations increasingly gain critical mass across its chosen markets.
“As we implement our Customer First Philosophy, we are approaching 2017 with real optimism, especially with the outlook remaining positive in many of our markets, where we benefit from our increasingly diverse revenue streams. We reiterate our pledge to delivering excellent service to our customers, and remain committed to creating superior and sustainable return for our shareholders,” he said.
Also speaking, the bank’s chief financial officer, Ugo Nwaghodoh, said UBA extracted efficiency gains across its operations to boost profitability.
He confirmed that the bank had seen significant improvement across major performance metrics, including an improvement in the net interest margin.
“Our performance in 2016 reflects the strong potential and resilience of our business. We grew top and bottom lines by 22 per cent and 32 per cent respectively, despite the stagflation in Nigeria, our core market,” he said.
He expressed delight at the performance of the group’s African subsidiaries outside Nigeria which he said contributed a third of the group’s profits.
Nwaghodoh added that the bank will continue to leverage innovative offerings to grow its share of the respective markets.
United Bank for Africa Plc is a leading financial services group in sub-Saharan Africa, with presence in 19 African countries, as well as the United Kingdom, the United States of America and France. From a single country operation founded in 1949 in Nigeria, Africa’s largest economy, UBA has emerged as a pan-African provider of banking and other financial services, to about 11 million customers globally, through one of the most diverse service channels in sub-Sahara Africa; 632 business offices, 1,750 ATMs, some 13,500 PoS, and a robust online and mobile banking platform.
UBA was the first Nigerian bank to make an Initial Public Offering (IPO), following its listing on the NSE in1970. It was also the first Nigerian bank to issue Global Depository Receipts (GDRs). The shares of UBA are publicly traded on the NSE and the Bank has a well-diversified shareholder base, including foreign and local institutional investors as well as individual shareholders.