NSE overheads hit N1.72bn in 2011

OCTOBER 16, 2012 BY UDEME EKWERE 1 COMMENT

The Nigerian Stock Exchange recorded increased overheads and operating expenses at the end of the 2011 financial year, with staff related costs rising to N1.724bn.

The Exchange’s overheads, which stood at N1.354bn at the end of the 2010 financial year, rose by N37m or 27.3 per cent to close at N1.724bn in 2011.

The information was contained in the NSE’s Annual Report and Financial Statement posted on its website.

According to the report, the NSE recorded a deficit of N358.71m in the 2011 financial year, compared to a surplus of N357.95m recorded in 2010, with most of its income eroded by rising staff-related costs and operating expenses.

Its operating expenses, however, dipped significantly by 43.27 per cent to N1.13bn, from N1.2bn recorded in 2010.

Under staff-related cost, the report showed that N1.22bn was paid to a total of 238 staff members as salaries and allowances, while pensions and gratuity gulped N102.23m. Medical expenses was put at N37.88m, while N367.91m was due to the Lagos State Internal Revenue Service from back tax audits.

It noted that the NSE recorded gross fees of N3.167bn, dropping by 21.04 per cent, from N4.01bn recorded in 2010.

Its share of profit from associated company rose to N467.202m, from N445.133m recorded in 2010. Also, it posted other income of N351.2m, up from N344.69m in 2010, while its operating expenses dipped significantly by 43.27 per cent to N1.13bn, from N1.99bn in 2010.

The report also noted that till date, the Exchange has recovered N609.5m, out of a total of N2.090bn distributed to certain council members of the NSE between 2006 and 2008. The Exchange added that it was only able to recover N2.5m in the 2011 financial year from one of the former council members, who was expected refund a total of N50m.

The NSE said, “Between 2006 and 2008, N2.090bn was distributed to some council members as share of surplus. Because this payment was against section 26(3) of Companies and Allied Matters Act 1990, the Securities and Exchange Commission directed the Exchange to recover the money from the council members involved.

“Refunds amounting to N609.5m have been received and are maintained in an escrow account. Part of the outstanding balance of N1.480bn is the subject of litigation on account of a dispute over the basis of payment.”

The President of the NSE, Alhaji Aliko Dangote, had recently said that the total market capitalisation of the NSE for the year ended December 31, 2011 stood at N10.28tn.

The figure, made up of secondary equity issues and Exchange Traded Funds and state/corporate bonds, represents a marginal decline of 5bn or 0.48 per cent compared to N10.33tn recorded at the end of December 2010.

However, the market capitalisation of the listed equities alone stood at N6.54tn, representing a decline by N17.42 per cent, compared to N7.92tn recorded in December 2010.

source: punch