NGX Hammers 17 Listed Companies With N93.9m Over Infraction

No fewer than 17 listed companies received the hammer of the Nigerian Exchange Limited (NGX) and were made to pay N93.92 million monetary fines for failure to file their financial statements after the regulatory due date in 2022.

Investigation showed that, the companies were sanctioned during the current financial year 2022 for their inability to meet the regulatory requirements ranging between third quarter (Q3) 2021 and Q3 of 2022.

Further checks revealed that Honeywell Flour Mills was fined N1.2 million for untimely filling of Q3, 2021 financial results. For audited financial statement, Notore Chemical Industries, Union Bank of Nigeria, Japaul Gold & Ventures, Presco, Veritas Kapital Assurance, LASACO Assurance, FBN Holdings, Ardova Plc, C&I Leasing Plc, Coronation Insurance, Mutual Benefits Assurance and Royal Exchange were fined N90,000; N1.2 million; N2.8 million; N3.6 million; N4.9 million; N4.8 million; N5.3 million; N5.5 million; N9.7 million; N11.6 million; N9 million; N4.4 million; and N6.3 million respectively.

PZ Cussons Nigeria got N4.8 million fine for 2022 audited financials and Ecobank Transnational Incorporated (ETI) was penalized with N3.2 million fine for Q3 20221 results.

The Exchange in its X-Compliance report explained that the initiative was designed to maintain market integrity and protect the investors by providing compliance-related information on all listed companies.

The report stated that “companies that are listed on the Exchange are required to adhere to high disclosure standards which are prescribed in Appendix 111 of the Listing Rules.

“Financial information which is periodic disclosure and on-going material events disclosure should be released to The Exchange in a timely manner to enable it efficiently perform its function of maintaining an orderly market”.

NGX Regulation Limited (NGX REGCO) applied sanctions in accordance with the Rules for Filing of Accounts and Treatment of Default Filing, Rulebook of NGX (issuers’ rules)

Market operators agreed that the sanctions were warranted, saying, such sanctions would compel more quoted entities to disclose their information to the market on a timely basis.

The managing director of Crane Securities Limited, Mr Mike Eze, said, the action of NGX would also boost investor confidence in the market because it is sending a clear message on the need for investors to get companies’ financial reports as at when due.

He added that investors always need to make informed decisions about which stocks to buy and that they can only be able to do that if companies release their regulatory filings on time.

The founder of the Independent Shareholders Association of Nigeria (ISAN), Sunny Nwosu, also agreed that the companies deserved to be sanctioned.

Nwosu noted that the affected companies ought to have filed their earnings reports on time to help shareholders to understand their financial health for investment decisions.

“It is not a new thing and it does not come to us as a surprise. We have constantly written to the exchange and raised the issue at annual general meetings that there is a need to know the status of these companies to enable us to take investment position,” he noted.