C & I Leasing the largest leasing company in Africa’s most populous nation has capitulated to macroeconomic headwinds as its gross earnings slumped, but gains from sale of a joint venture lifted profit.
The 2022 audited financial statement of the company showed gross earnings or total revenue reduced by 1.49 percent to N17.93 billion from N18.19 billion as at December 2021.
A breakdown of revenue figures shows lease income also nosedived, as it reduced by 5.13 percent to N13.64 billion, while net lease income (after deducting lease expenses) were down 16.10 percent to N7.19 billion.
A recent report by ELAN highlighted that operators in the leasing industry are beset by continued absence of appropriate funding mechanism
“Money is the raw material for leasing, its adequacy, availability and cost, is key to the success of the industry,” said the report.
“This issue is becoming more challenging, with the prevailing economic conditions that have further tightened liquidity in the system. ELAN, continues to engage financiers locally and internationally for an appropriate funding mechanism for the industry.”
In the last eight years, Nigeria has been experiencing sluggish economic growth caused by bad economic policies, rising inflation, the vagaries in crude oil price, severe dollar scarcity, and geopolitical tensions.
And the woes of the country are compounded by the reforms of president Bola Ahmed Tinubu such the removal of subsidies on premium motor spirit (PMS) and the unification of the foreign exchange rate which spurred price rises and stoked an unprecedented weakening of the currency.
The country’s headline inflation for September stood at 27.07 percent, according to data from the National Bureau of Statistics (NBS).
The International Monetary Fund has downgraded Nigeria’s economic growth by 0.3 percentage points to 2.9 per cent for 2023 as a result of lower production in oil and gas.
However, C & I leasing profit surged by 1,746 percent to N577.26 million in December 2022, thanks to gains on the sale of a joint venture.
The company’s shares have gained 9.89 percent so far this year, underperforming the NGXASI index.