Business
CGF Post-Tax Profits Slump By 239.76%
The bearish Nigerian Stock market has once again claimed another victim, as Coral Growth Funds’ (CGF) post-tax profits slumped 239.76 per cent from N1.16 billion in 2007 to a loss of N1.16 billion in 2008.
According to the fund’s financials report for the year-end period December 2008, the CGF’s net income before tax also slide to N1.61 billion in 2007. This represents a decrease of 238.28 per cent.
In his report, Kenneth Spuliag, managing director and Chief executive officer of Asset Management Limited (FAML), explains that the performance of the equities market during the year had a negative impact on the performance of the CGF.
Consequently, he said the offer price of the fund recorded a decline of 29.38 per cent to close the year at N1,477.19.
“In spite of decline in the fund’s performance, the fund output performance, the Nigeria Stock Exchange (NSE) All Share Index (ASI), lost 45.77 per cent during the same period.”
CGF is an actively managed open-ended unit trust scheme that invest a maximum of 65 per cent of its assets in equity securities quoted on the NSE.
The Fund Manager further said, “Given the event in the stock market in the second quarter of the year, we had anticipated that the stock market will not record a positive performance in 2008.
“As a result, the Fund Manager embarked on a significant reduction in the funds exposed to the capital market. As at December 31, 2008, 55 per cent funds assets were invested in fixed income securities, 22 per cent was invested in banking sector of the stock market, while eight per cents was invested in other sectors of the market.”
However, in spite of the above result, the Fund declared and paid 0.723 dividend per unit holder.
Similarly, Coral Ethical Funds (CEF) recorded loss in its financial year ended December 31 2008, by losing 281.22 per cent net income after tax from N14.3 million in 2007 to N25.8 million in 2008.
Its net income before tax also went down to N25.7 million in 2008 from the N14.4 million recorded the previous year, representing 279.12 per cent decline.