The Chairman, Board of Directors of Central Securities Clearing System (CSCS) Plc, Mr. Oscar Onyema, has stated that with the support of shareholders and other stakeholders, the company will continue to deliver superior performance and create wealth for shareholders.
Addressing shareholders at the company’s 28th Annual General Meeting (AGM) held in Lagos over the weekend, Onyema, said: “Notwithstanding the volatile operating environment and moderated capital flows, as reflected in the subdued capital market activities, the earnings fundamentals of your Company remained resilient and indeed stronger than ever.
“This fact is evident in the impressive revenue growth of 39.2per cent, driven by stellar growth in ancillary income. The equity market recorded one of the weakest secondary market activities in the past few years, with the average daily trade value of N3.9billion, some 10per cent below the trading activity recorded in 2020 financial year, explaining the tepid transaction fees.
“Albeit income from ancillary services recorded a significant boost, contributing N2.2billion or 21.5 per cent of total income in 2021FY, from N526million or 11.3 per cent of total income in 2020FY. This performance reinforces the capacity of the Management in delivering on the Board’s vision result of diversifying the business and enhancing the value accretion prospect to shareholders in a sustainable manner.”
Speaking, the Chief Executive Officer, CSCS Plc, Mr. Haruna Jalo-Waziri, said; “Reflecting the ingenuity of our participants and more importantly quick adoption of new remote access technologies, the Nigerian capital market remained active through the prolonged COVID-19 crisis. The collaboration of our regulator and participants has been incredible in sustaining our operational protocols and IOSCO PFMI standards.”
“Though clearing and settlement activity waned by 10.2 per cent due to lower participation of foreign investors in the Nigerian equity market and a host of macro challenges, we are excited at the growth in our depository assets by 6.1 per cent to N23.0trillion, reflecting new listings of securities across our multiple Exchange partners as well as issuers’ and investors’ confidence in the safety and secured accessibility of our systems.
Continuing, Mr. Jalo-Waziri said: “Despite the average inflation rate of 17 per cent during the year, we sustained our cost efficiency strategy, leading to a 1.6 per cent decline in operating expenses. Overall, we achieved N5.8Billion and N4.4Billion Profit Before Tax and Profit After Tax respectively, underpinning the resilience of the business and commitment of my colleagues and I, in delivering on our pledge to sustainably create value for shareholders and our broader ecosystem.
“It has been twenty-five years of meritorious service, as the infrastructure for the Nigerian capital market. We have pioneered a number of initiatives and efficiencies in the market and have enjoyed the best of collaborative engagements with different stakeholders. Whilst we relish our progress working with other stakeholders in transforming the Nigerian capital market, we reckon there is a long way to go in bridging the gap towards our aspiration of positioning the Nigerian capital market as the hub of securities services in Africa and one of the leading capital markets, globally. To this end, we have reinvigorated our strategic thrust with the development of a medium-term playbook that would enhance our capabilities in executing new initiatives towards deepening the Nigerian capital market and strengthening our business growth frontiers for the mutual prosperity of all our stakeholders.”
Consolidating on its diligent earnings diversification drive, the Company grew revenue from core operations and ancillary services by 39.2 per cent to N6.4billion from N4.6billion in 2020, as it almost quadrupled earnings from ancillary services from N526million in 2020 financial year to N2.2billion in 2021 financial year. Notably, income from ancillary services contributed 33.3per cent and 21.5per cent of operating revenue and total income for the year respectively, underpinning Management’s strategy towards diversifying and strengthening the earnings fundamentals of the Company, with the ultimate objective of creating sustainable and superior wealth for shareholders and its broader stakeholders.