United capital Plc is efficient in generating returns on the investment it received from its shareholders as net income has been rising steadily in the past three years even amid the Covid-19 crisis.
For the first nine months through September 2021, United Capital’s return on average equity increased to 29.58 percent from 18.91 percent as at September 2020, according to MoneyCentral calculations.
Of course, net income followed the same growth trajectory as it surged by 72.25 percent to N5.96 billion in September 2021 from N3.46 billion as at September 2020.
Revenues were up 60.33 percent to N11.32 billion in the period under review from N7.06 billion the previous year.
The uptick in earnings was driven by income from managed funds, which is a major component of the investment income and fees and commission income.
For instance, income from managed funds surged by 198.36 percent to N14.56 billion in the period under review from N4.88 billion the previous year.
Also, other fees and commission income-which include management fees from mutual funds which are recognised at point in time, fees and transaction signon fees- spiked by 140.47 percent to N3.90 billion in September 2021 from N1.62 billion as at September 2020.
Analysts say are optimistic and sanguine that United Capital will maintain the growth momentum into the final quarter of the year, and they added that shareholders will be adequately compensated for taking the risk for investing in the entity.
So far this year, it successfully listed three series of commercial papers worth N19.72 billion on the FMDQ Securities Exchange.
The CPs were issued under the company’s N50 billion commercial paper issuance program. This has further positioned us as a company to provide a wider range of wholesale financing solutions to our clients and complement the funding base and support for all our businesses.
Another remarkable point to note was the Nigerian Stock Exchange’s reclassification of United Capital shares from Low Price Stock Group to Medium Price Stock Group in August 2021 driven by steady growth in the company’s share price over the past months due to our consistent impressive performance over the years.
United Capital is able to turn each Naira invested in revenue by its owners into generating higher profit amid a harsh and unpredictable macroeconomic environment.
Net profit margin increased to 52.65 percent in September 2021 from 49 percent the previous year.
Also, cost to income ratio reduced to 37.40 percent in the period under review from 41.67 percent the previous year.
“I want to assure our stakeholders that we are optimistic on sustaining this exciting performance in the last quarter of the year and beyond. We remain focused on our transformation agenda and to continue to provide best-in-class solutions to all client segments,” said Peter Ashade, Group managing director of United Capital.