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MarketScreener Homepage  >  Equities  >  Nairobi Stock Exchange  >  Equity Group Holdings Plc    EQTY   KE0000000554

EQUITY GROUP HOLDINGS PLC

(EQTY)
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Equity : Condensed Financial Statements For The Period Ended 30th June 2020

08/18/2020 | 05:01am EST

Equity Group Holdings Plc

The Board of Directors of Equity Group Holdings Plc is pleased to announce the unaudited results of the Group for the six months period ended 30 June 2020

Condensed directors' remuneration report

For the

6 months ended

6 months ended

Year ended

30.06.2020

30.06.2019

31.12.2019

Unaudited

Unaudited

Audited

Shs' 000

Shs' 000

Shs' 000

Aggregate directors' emoluments

50,351

100,129

121,968

Condensed consolidated statement of profit or loss

For the

6 months ended

6 months ended

12 months ended

30.06.2020

30.06.2019

31.12.2019

Unaudited

Unaudited

Audited

Shs' millions

Shs' millions

Shs' millions

Net interest income

24,635

21,079

44,983

Net fee and commission income

7,005

8,234

17,170

Other income

4,853

6,061

9,078

Fair value loss on loan notes at FVTPL

-

-

(1,000)

Provision for impairment losses on loans and advances

(7,699)

(466)

(3,458)

Net operating income

28,795

34,908

66,773

Operating expenses

(16,817)

(17,919)

(35,295)

Profit before income tax

11,977

16,989

31,478

Income tax expense

(2,900)

(4,981)

(8,917)

Profit for the period

9,077

12,008

22,561

Condensed consolidated statement of other comprehensive income

For the

6 months ended

6 months ended

12 months ended

30.06.2020

30.06.2019

31.12.2019

Unaudited

Unaudited

Audited

Shs' millions

Shs' millions

Shs' millions

Profit for the period

9,077

12,008

22,561

Other comprehensive income:

FVOCI investment securities, net of tax

1,323

3,324

2,630

Exchange differences on translation of foreign operations

1,183

(3)

(824)

Other comprehensive income for the period

2,506

3,321

1,806

Total comprehensive income for the period, net of tax

11,583

15,329

24,367

Earnings per share (basic and diluted) (Shs)

2.39

3.16

5.93

Condensed consolidated statement of financial position

At

30.06.2020

30.06.2019

31.12.2019

Unaudited

Unaudited

Audited

Shs' millions

Shs' millions

Shs' millions

Assets

Cash, deposits and balances due from financial institutions

86,578

90,733

86,434

Derivative financial assets

58

156

472

Investment securities

216,386

179,619

172,208

Due from related parties

-

-

19

Current income tax

111

153

152

Loans and advances to customers

391,633

320,886

366,440

Other assets

14,755

11,976

12,745

Property and equipment

11,166

10,170

11,031

Right-of-use assets

6,859

8,715

7,342

Intangible assets (including goodwill)

10,643

10,175

10,347

Deferred income tax

8,280

6,080

6,492

Total assets

746,469

638,663

673,682

Liabilities

Deposits from customers

543,894

458,595

482,752

Borrowed funds

57,573

55,877

56,714

Due to related parties

90

77

-

Other liabilities

13,922

11,934

12,865

Lease liabilities

6,789

8,538

7,496

Current income tax

815

843

1,928

Deferred income tax

26

59

150

Total liabilities

623,109

535,923

561,905

Equity

Share capital

1,887

1,887

1,887

Share premium

16,063

16,063

16,063

Retained earnings and other reserves

104,298

83,819

92,769

Equity attributable to owners of the company

122,248

101, 769

110,719

Non-controlling interests

1,112

971

1,058

Total equity

123,360

102,740

111,777

Total equity and liabilities

746,469

638,663

673,682

Condensed consolidated statement of changes in equity

Attributable to owners of parent

Retained

Non-con-

earnings

Share

Share

and other

trolling

Total

capital

premium

reserves

Total

interests

equity

Shs'

Shs'

Shs'

Shs'

Shs'

Shs'

6 months period ended 30 June 2020

millions

millions

millions

millions

millions

millions

At start of period

1,887

16,063

92,769

110,719

1,058

111,777

Profit for the 6 months period

-

-

9,023

9,023

54

9,077

Other comprehensive income

-

-

2,506

2,506

-

2,506

At end of period

1,887

16,063

104,298

122,248

1,112

123,360

6 months period ended 30 June 2019

At start of period

1,887

16,063

76,124

94,074

883

94,957

Profit for the 6 months period

-

-

11,920

11,920

88

12,008

Other comprehensive income

-

-

3,322

3,322

-

3,322

Final 2018 dividend declared

-

-

(7,547)

(7,547)

-

(7,547)

At end of period

1,887

16,063

83,819

101,769

971

102,740

12 months period ended 31 December 2019

At start of year

1,887

16,063

76,124

94,074

883

94,957

Profit for the year

-

-

22,386

22,386

175

22,561

Other comprehensive income

-

-

1,806

1,806

-

1,806

Final 2018 dividend declared and paid

-

-

(7,547)

(7,547)

-

(7,547)

At end of year

1,887

16,063

92,769

110,719

1,058

111,777

Condensed consolidated statement of cash flows

For the

6 months ended

6 months ended

12 months ended

30.06.2020

30.06.2019

31.12.2019

Unaudited

Unaudited

Audited

Shs' millions

Shs' millions

Shs' millions

Cash generated from operations

52,047

39,079

32,476

Income taxes paid

(5,471)

(3,899)

(8,487)

Net cash generated from operating activities

46,576

35,180

23,989

Net cash used in investing activities

(46,375)

(17,176)

(12,398)

Net cash generated from / (used in) financing activities

859

(312)

(1,384)

Net increase in cash and cash equivalents

1,060

17,692

10,207

Cash and cash equivalents at the start of period

70,780

60,573

60,573

Cash and cash equivalents at the end of period

71,840

78,265

70,780

Performance highlights

The Group reported decline in profitability from Shs 12.0 billion to Shs 9.1 billion for the corresponding period the previous year. The performance as at 30th June 2020 reflects the implementation of both defensive and offensive strategies to respond to the COVID-19 situation that has transformed the operating environment.

EGH Plc's balance sheet grew by 17% from Shs 638.7 billion to Shs 746.5 billion driven by 19% growth in customer deposits to Shs 543.9 billion from Shs 458.6, funding that was deployed to grow loans to customers by 22% and investment in Government securities by 20%. Regional subsidiaries grew faster increasing their contribution to the Group profitability to 28% up from 26% same period the previous year. Post balance sheet date, the Group completed the acquisition of 66.53% of BCDC the second largest bank in DRC paving way for the Group to achieve a systemic position after merger and amalgamation of the two subsidiaries in DRC.

Top-line net interest income was up 17% to Shs 24.6 billion up from Shs 21.1 billion the previous year driven by a 22% growth in loan book from Shs 320.9 billion to Shs 391.6 billion. Non-funded income declined by 3% from Shs 14.5 billion to Shs 14.1 billion as a result of the waiver of mobile transaction fee in Kenya since April 2020 to drive behaviour change towards virtual banking enabled by mobile technology; and lower transactional activity given weak economic activity. Customers shied from use of Merchant Banking and Agency Banking as transactional channels with merchant transactions stagnating as commissions declined by 10% from Shs 103.3 million to Shs 93.3 million as agency cash in cash out transaction volume declined by 20% from Shs 54.031 billion to Shs 42.975 billion with resultant commission declining by 25% from Shs 1.055 billion to Shs 789 million. However, retail digital commerce payments Eazzy Pay and Pay with Equity recorded 49% growth in cumulative number of transactions from 1.152 million to 1.719 million transactions as value of transactions grew by 52% to reach Shs 9.8 billion up from Shs 6.4 billion.

Total costs increased by 44% to Shs 26.7 billion up from Shs 18.6 billion driven by a 15-fold increase in loan loss provision which increased to Shs 7.7 billion up from Shs 500 million in recognition of portfolio risk associated with the adverse disruption of COVID-19 health pandemic control, management and containment measures and resultant economic shocks and disruptions of supply chains by economic lockdowns.

To cushion liquidity shocks the Group maintained a liquidity of 54% while Kenya recorded 59.4% liquidity ratio. On the defensive strategy the Group focused on efficiency and cost optimization that resulted in the Group cost income ratio declining from 52.8% to 48.8%. To mitigate for loss of mobile transactions fee and merchant banking fees and commissions, the Group focused on Diaspora remittances and increased revenues by 51% from Shs 398 million to Shs 601 million while increasing forex income by 20% to Shs 2.231 billion up from Shs 1.859 billion.

Equity Group Foundation rolled out a Shs 1.3 billion complimenting support to the fight against Covid-19 by providing frontline health workers dealing with Covid-19 patients with Personal Protective Equipment (PPEs) in Kenya and DRC while providing testing kits to Rwanda. The Foundation further enhanced its MSMEs training to help preserve jobs by slowing layoffs while scaling disbursements of cash transfers under social safety net and protection programs with governments and the donor community. Our associate network of medical clinics Equity Afia doubled its clinics to support provision of non Covic-19out-patient services. The Foundation continued with youth and women training and credit facility programme under Young Africa Works program to support livelihoods.

Dividends

The Board of Directors does not recommend the payment of dividend for the first half of the year 2020.

Explanatory notes

The accounting policies used in preparing these financial statements are consistent with those used for the Group's 31 December 2019 annual financial statements. The above financial statements are extracts from the records of the Group.

They were approved for issue by the Board of Directors on 17th August 2020 and signed on its behalf by:

Dr. James Mwangi, CBS

Mary Wamae

Group Managing Director & CEO

Group Executive Director

2020

• Best Bank in Africa

• Position 20 globally on Return on Assets

• Bank of the Year - Kenya

Africa's SME Bank of the Year,

• Best Digital Bank in Africa

• Position 62 globally on Soundness

• Bank of the Year - Uganda

2018 & 2019

• Excellence in Leadership in Africa

(Capital Assets Ratio)

• Bank of the Year - South Sudan

• Position 55 globally on Profits on Capitals

• Position 754 largest bank globally

Equity Group Holdings Plc is regulated by The Central Bank of Kenya

Disclaimer

Equity Group Holdings Limited published this content on 18 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 August 2020 09:00:13 UTC


© Publicnow 2020
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Financials
Sales 2020 81 018 M 738 M 738 M
Net income 2020 22 830 M 208 M 208 M
Net Debt 2020 - - -
P/E ratio 2020 7,34x
Yield 2020 4,62%
Capitalization 135 B 1 226 M 1 225 M
Capi. / Sales 2020 1,66x
Capi. / Sales 2021 1,46x
Nbr of Employees 6 580
Free-Float 77,3%
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Mean consensus OUTPERFORM
Number of Analysts 9
Average target price 43,09 KES
Last Close Price 35,65 KES
Spread / Highest target 29,0%
Spread / Average Target 20,9%
Spread / Lowest Target 7,71%
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Managers
NameTitle
James Njuguna Mwangi Group CEO & Non-Independent Executive Director
David Raymond Ansell Chairman
David Ngata Group Director-Finance
Lanre Bamisebi Group Chief Information Officer
Mary Wangari Wamae Non-Independent Executive Director
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