Access Holdings’ Q1’24 PAT tops 122.5% to reach N159bn

Bolaji Agbede, acting group chief executive officer, Access Holdings

Onome Amuge

Access Holdings Plc, the Nigeria headquartered multinational financial services powerhouse, has reported an after-tax profit of N159.3 billion in the first quarter of 2024, topping last year’s Q1 PAT by 122.5 percent, its recently released financial statement has shown.

In 2023, post tax profit stood at just N71.8 billion and this first quarter 2024 result appears to continue from the financial HoldCo’s impressive end-year 2023 performance when its gross earnings broke the Nigerian financial sector record with N2.594 trillion.

Driven by the higher effective interest rate, the group’s interest income swelled to an impressive N608.1 billion in the first quarter of 2024, a 142.4 percent increase from N250.9 billion in the corresponding period of 2023. However, the rising interest rate environment exerted pressure on the group’s interest expense, which rose 179 per cent to N443.9 billion from N158.9 billion during the same period.

Access Holdings Plc continued its upward trajectory, with its net interest income leaping 189 percent to N275.8 billion in the first quarter of 2024, up from N95.3 billion in the corresponding period of 2023. The group’s net fee and commission income also saw a healthy boost, swelling to N86.9 billion from N45.4 billion during the period under review, showcasing the company’s growing financial prowess.

The group’s cash and cash equivalents demonstrated a notable improvement, expanding from N1.17 billion at the end of the period to  N3.93 billion. However, a closer look into the group’s cash flow movements revealed a significant reversal in net cash generated from operating activities, plunging from a substantial positive N176.3 billion in the corresponding period of 2023 to a negative N28.2 billion in the first quarter of 2024.

The wheels of fortune turned in favour of Access Holdings Plc’s investing activities, propelling the group’s cash flow from a negative N194.8 billion in the corresponding period of 2023 to a positive N401.2 billion during the first quarter of 2024. On the other hand, the group’s financing activities reflected a sense of consistency, with net cash generated consolidating to a negative N561 million from a substantial negative N52.9 billion in the corresponding period of 2023.

An in-depth analysis by the team of analysts at Cordros Securities revealed a remarkable 183.1 percent surge in Access Holdings Plc’s interest income to N719.60 billion in Q1 2024, propelled by significant growth across all key contributory lines, with investment securities rising 255.4 percent, loans and advances to customers showcasing a 125.2 percent increase, loans and advances to banks rising 292.4 percent, and cash and bank balances with banks gaining 478 percent.

Cordros’s financial analysts deciphered the intricacies behind Access Holdings Plc’s growing core income, pinning it down to two key factors: an impressive 142.5 percent expansion of investment securities to N8.52 trillion year-to-date and a favourable environment of elevated interest rates in the fixed-income market.

Diving deeper into the group’s mounting costs, they unearthed a 364.7 percent increase in costs related to deposits from financial institutions, a 108.4 percent surge in costs associated with deposits from customers, and a 102.7 percent jump in the costs of interest-bearing borrowings, alongside a 352.5 percent rise in the costs of debt securities issued during the period under review.