By Goddy Egene and Eromosele Abiodun , 10.10.2010

The Nigerian Stock Exchange (NSE) will next month (November 16) delist five companies on Emerging Markets sector for their failure to comply with the post-listing requirements of the Exchange. The companies are: West Africa Aluminium Products Plc; Flexible Packaging Plc;  Krabo Nigeria Plc, Newpak Plc, and Tropical Petroleum Products Plc.

 

The Emerging Markets sector, formerly known as Second-Tier Securities Market, is meant for companies that do not have the requirements to be on the first-tier sector. The companies are mostly indigenous and have been performing poorly over the years due to problems of inadequate finance, weak management among others. 

 

Based on the poor performance many of them have not been submitting their financial results. The NSE said last Friday that preparatory to the delisting on November 16, the five companies have been placed on full suspension, implying that the shares can no longer be traded.

 

As part of efforts to restore investors’ confidence in the market the new management of the NSE, led by the Interim Administrator, Mr. Emmanuel Ikazoboh, has intensified the enforcement of   its post-listing requirements.

 

The Exchange has last month given an ultimatum to some companies, which are yet to submit their audited accounts for the year ended December 31, 2009. While some of the companies have complied, others that could not meet the deadline were suspended last week pending when they will comply. Twelve insurance companies were affected by the suspension.However, some of the suspended companies came out with their results last week. For instance, Staco Insurance Plc reported gross earnings of gross premium of N5.1 billion for the year ended December 31, 2009, compared as against N4.375 billion in the comparable period of 2008. Profit after tax stood at N433.2 million, down from N542.42 million in 2008.

 

Crusader (Nigeria) Plc posted turnover of N3.922 billion in 2009 as against N3.701 million in the comparable period of 2008. But the company ended the year with loss of N626.84 million, compared with profit after tax and extra-ordinary items of N85.52 million in 2008.Sovereign Trust Insurance Plc, which was not affected by the suspension, posted gross premium of N4.44 billion for the year ended December 31, 2009 as against N3.812 billion in the comparable period of 2008. Profit after tax slumped from N361 million in 2008 to N4.2 million  in 2009.

 

Source:ThisDay