August 16, 2013 TOTAL NIGERIA PLC EQUITY ‖ NIGERIA ‖ OIL & GAS Investment Summary & Highlight MorganCapital Research African Frontier Market LEAD ANALYST Chuks Anyanwu [email protected]+234-08066397836 SALES Julcit Hwande [email protected]+234-8107596134 +234-1-2714713-4 REGULATORY COMPLIANCE Taiwo Balogun [email protected]MD/CEO Ayoleke O Adu FCS, CFA [email protected]Key Ratios & Statistics Current Stock Price: N155.00 Fair Value: N197.79 Outlook: POSITIVE Market Capitalization: $329.37B Year End: December Price-to-Earnings (PE) 2012Trailing: 11.26X 2013 Forecast: 10.25X 2014 Forecast: 8.52X Earnings-per-Share (EPS) Current: (FY 2012): N13.76 2013 Forecast: N15.11 2014 Forecast: N18.19 Dividend-per-Share: N11.00 Return-on-Equity: 41.32 % Return-on-Asset: 6.14 % Outstanding Shares (m’n) 340 Free Float: (m’n) 113(33.2%) Year-to-Date: 28.55% Latest Result H1 2013 Dollar ($) N160 H1 -2013 Result @ a glance N (m’n) N (m’n) % H1 -2013 H1 -2012 Gross Earnings 117,294 109,839 6.78 PBT 3,902 4,466 12.63 PAT 2,409 2,923 17.58 EPS 7.10 8.60 17.44 Stock Rating BUY Industry View In-Line TOTAL PLC: a diamond in the rough? H1 -2013: Revenue rose by 7%, while Net income declined by 18% YoY. Total Nigeria (‘’Total’’ or the “Company”) on Wednesday 31 st July 2013 released its unaudited H1-2013 result. Revenue rose by 7% to N117.29billion ($733.08M) from N109.84billion ($686.50M) YoY but declined by 7.87% to N56.24billion ($351.53M) from N61.05billion ($381.55M) quarter on quarter (Q1 -2013 - Q2 -2013). While net income declined by 17.58% to N2.41billion ($15.05M) from N2.92billion ($18.27M) YoY but improved by 10.39% to N1.26billion ($7.90M) from N1.14.99billion ($7.15M) quarter on quarter. The Company clearly performed better in Q2 -2013 despite the slowdown in sales. Cost of sales declined by 9.23%, faster than the decline in sales over the same period (7.87%) and together with the 10.7% decline in the distribution expenses in Q2 -2013, accounts for the improvement in net income in the Q2 -2013 compared to Q1 -2013. Gross profit improved by 20.56% to N15.56billion ($97.27M) from N12.91billion ($80.68M) YoY and marginally by 1.60% to N7.87billion ($49.02M) from N7.72billion ($48.25M) quarter on quarter. Gross profit margin settled at 13.27%, up from 11.75% YoY and 13.94% from 12.64% quarter on quarter. Operating profit rose by 7.00% to N5.01billion ($31.33M) from N4.68billion ($29.28M) YoY and 5.74% to N2.58billion ($16.10M) from N2.43billion ($15.23M) quarter on quarter. Operating profit margin settled at 4.27% up from 4.26% YoY and 4.54% from 3.99% quarter on quarter. The vastly slower growth in operating profit year on year compared to the gross profit growth is adduced to the 30% rise in administrative expenses over the same period. The Company impressively translated a quarter on quarter decline in revenue to an improvement in operating profit quarter on quarter boosted by a 10.7% reduction in distribution expenses. Net profit consequently declined by 17.58% to N2.41billion ($15.05M) from N2.92billion ($18.27M) YoY but improved by 10.39% to N1.26billion ($7.90M) from N1.14billion ($7.15M) quarter on quarter. Bloomberg Ticker: TOTAL: NL NSE Symbol: TOTAL Listed on the Nigerian Stock Exchange ...leading the Global Investment Path to Africa TM
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