Income tax

Increase in income tax charges

Despitee the high inflation that is rocking the Nigerian economy, Access Holdings Plc has announced that its profit after tax (PAT) reached N88.739 billion in the first half (H1) of 2022.

This represents an increase of 2.21% as the group recorded N86.819 billion in the same period of 2021. According to the group’s first half 2022 financial results which were released on Thursday, its profit before tax (PBT) increased slightly by 0.42%. to 97.791 billion naira from 97.379 billion naira in 2021. The rate increased by 22.51% to 342.530 billion naira from 279.594 billion naira recorded in the half of 2021, supported by impressive growth in lending income and advances to customers (+37.0% year-on-year to N238.94 billion).

The Holdco also recorded earnings per share (EPS) growth of 1.7% YoY to N2.46 per share compared to N2.42 per share recorded in the same period of 2021 and this was mainly supported by growth in the non-core revenue segment (+67.2% YoY).

According to the group, during the period under review, the board of directors proposed an interim dividend of 20 Kobo per ordinary share of 50 Kobo each on the 35,545,225,622 issued ordinary shares of 50k each payable to shareholders of record at register of shareholders on the closing date. This equates to a dividend yield of 2.2% based on the last closing price of N8.95 per share on the floor of the Nigerian Exchange Limited (NGX) on Wednesday.

Further analysis of the result revealed a slight increase in income from loans and advances to banks (+1.8%y/y to N8.09bn) amid lower income from treasury and balances with Banks (-23.2% y/y to N3.97bn) and Investment Securities (-37.7% YoY to N45.84bn).

Elsewhere, non-interest income (NII) rose 67.2% year-on-year to N193.84 billion on gains on investment securities (+375.8% year-on-year to 64, 14 billion naira) and currency revaluation (+367.3% year-on-year). /year to N11.28 billion).

Meanwhile, foreign exchange revenue (-22.5%y/y to 52.84bn naira) and fees and commissions (-5.6%y/y to 55.44bn naira) both recorded declines. Despite weaker funded revenue growth, unfunded revenue growth was strong enough to support operating profit growth (+23.4% year-on-year).

In addition, operating expenses increased by 35.2% year-on-year to N256.68 billion as all contributory items increased during the period as evidenced by rising regulatory costs and pressures inflationary.

Specifically, the increase was recorded in personnel expenses (+33.6% y/y to NGN 58.27 billion), AMCON levy (+27.0% y/y to NGN 52.73 billion), premium NDIC (+11.4% y/y to N11.10bn) and Depreciation & Amortization (+8.0% y/y to N21.70bn). Following the faster growth of OPEX compared to operating income, the cost/income ratio (excluding LLE) stabilized at 72.4% in the first half of 2022 (compared to 66.1% in the first half of 2021).