CAL bank (CAL) recorded a 23.22% dip in pre-tax profits for the first quarter of 2017 (Q1-2017). Total Profits before tax fell from GHS 58,389,000 in Q1-2016 to GHS 44,831,000. The fall in pre-tax profits reflected the challenges the bank continues to face with regards to the energy sector debts yet to be repaid to the bank.
Interest Income for the period increased by 13.26%; from GHS 139,659,000 to GHS 158,171,000 over the 12 months period. Interest expense over the period rose by 31% resulting in a 2.46% marginal drop in the Net Interest Income of the listed bank. The bank has restricted its business in the energy sector focusing more on other reliable sectors of trade. The shift in trade business resulted in Net Trading Income increasing by 63%; from GHS 10,362,000 in Q1-2016 to GHS 16,891,000 in Q1-2017. Total Operating Income at the end of the period under review fell marginally by 1.56%; from GHS 104,434,000 in Q1-2016 to GHS 102,800,000.
Profit for the period fell by 21.56% to GHS 30,916,000; from GHS 39,413,000 in Q1-2016. Earnings per share as expected fell from GHS 0.0719 in Q1-2016 to GHS 0.056 in Q1-2017. Net Assets per share equally declined from GHS 0.99 in Q1-2016 to GHS 0.97 in Q1-2017.
The decline in the bank’s profits is likely to impact the performance of the shares of CAL in the short term. Year to date returns on the stock is -12.00% reflecting the difficult Q1-2017 period for the bank which saw the share price tumble from GHS 0.75 to GHS 0.66. CAL is recommended as a HOLD as a result of the stock’s high liquidity. The equity continues to trade within a very volatile price range as a result an attractive stock for retail investors in the short term. The stock could rebound in terms of performance and share price within the shortest term of trade.
Trading activity on the bourse ended with 8 gainers [BOPP, CAL, GCB, GOIL, HFC, SCB, TBL and UNIL] and 1 loser [EGH] yesterday. UTB topped the trading chart in terms of volume as 220,000 shares worth GHS 13,200.00 changed hands. Returns on the Composite and Financial Stock Index pegged at 11.51% and 15.08% respectively.
Trading activity on the Alternative market ended yesterday with 72,400 shares of Intravenous Infusion Limited [IIL] valued at GHS 6,516 changing hands.
HORDS currently lead record capital gains on the GAX, appreciating by 25% from 2016 year open.
The Cedi LOST marginally to all the major trading currencies yesterday.
The local currency exchanged at a mid-rate of GHS 4.1831 to the USD, GHS 5.3607 to the GBP and GHS 4.5699 to the EURO.
The GCFM Cedi index, a measure of the holistic performance of the Cedi on the inter-bank market now records a year-to-date depreciation of 1.23%.
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