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NIC Bank Q1 2011 Profit After Tax rises by 54%
mwanahisa
#1 Posted : Thursday, May 12, 2011 10:39:07 AM
Rank: Elder


Joined: 6/2/2008
Posts: 1,438
NIC has released a steady set of results for the 1st Qtr 2011, driven primarily by an increase in Net Interest Income.

PBT up 52% to Kshs 803,338,000

PAT up 54% to Kshs 550,114,000

Operating Income up 28% to Kshs 1,430,642

Net Interest Income up 45% to Kshs 953,906,000

All in all, a commendable and sustainable set of results.
mkonomtupu
#2 Posted : Thursday, May 12, 2011 10:45:09 AM
Rank: Veteran


Joined: 2/10/2010
Posts: 1,001
Location: River Road
@mwanahisa thanks I have been waiting for this. it occupies a large chunk in my portfolio. Good results they are doing so well in asset finance
PONDI
#3 Posted : Thursday, May 12, 2011 10:53:53 AM
Rank: Veteran


Joined: 5/8/2007
Posts: 885
.. offcourse they doing super fine. they still levy 'account maintenance fees' of 350 kshs. thats 4200 annually. surely aint that my entire annual water bill? or council rates? or that policy? .. cant airtel just...
mwanahisa
#4 Posted : Thursday, May 12, 2011 10:55:41 AM
Rank: Elder


Joined: 6/2/2008
Posts: 1,438
Dont mention it, Comrade mkonomtupu.

Interestingly, if we project a similar performance for the remaining 3 quarters of the year, NIC is trading at a forward PE of ONLY 8.26 even after adjusting the number of the shares for the yet uncredited bonus issue. This is actually a steal.

I expect that the bank can sustain this performance considering that most of its income is from interest income this time around.

DISCLAIMER: I have a nominal number of shares in this counter, as I have always seen it as too slow to appreciate.
The Merchant
#5 Posted : Thursday, May 12, 2011 11:08:09 AM
Rank: Veteran


Joined: 5/24/2010
Posts: 846
Location: KENYA
mwanahisa wrote:
Dont mention it, Comrade mkonomtupu.

Interestingly, if we project a similar performance for the remaining 3 quarters of the year, NIC is trading at a forward PE of ONLY 8.26 even after adjusting the number of the shares of the yet uncredited bonus issue. This is actually a steal.

I expect that the bank can sustain this performance considering that most of its income is from interest income this time around.

Can Q2 interest income beat Q1 interest income considering the higher interest rates? What makes you conclude that these results are sustainable?d'oh!
mwanahisa
#6 Posted : Thursday, May 12, 2011 11:16:24 AM
Rank: Elder


Joined: 6/2/2008
Posts: 1,438
The Merchant wrote:

Can Q2 interest income beat Q1 interest income considering the higher interest rates? What makes you conclude that these results are sustainable?d'oh!


Primarily because interest income is recurrent. The loan book will be bigger than it was throughout 2010. This translates to higher income as long as the interest margin is maintained and NPLs do not spike.

History suggests that banks are able to maintain their net interest margins even when interest rates rise. NIC also has a good history regarding NPLs. Net Profits have been growing uninterrupted for quite a while now.
Magnetic Touch
#7 Posted : Thursday, May 12, 2011 11:29:02 AM
Rank: Member


Joined: 12/31/2008
Posts: 90
Clearly, NIC does not have the x-factor.
Iborian
#8 Posted : Thursday, May 12, 2011 12:38:51 PM
Rank: Member


Joined: 4/17/2009
Posts: 194
ZZZZZZZZZZZZ
muganda
#9 Posted : Thursday, May 12, 2011 12:49:42 PM
Rank: Elder


Joined: 9/15/2006
Posts: 3,906
Magnetic Touch wrote:
Clearly, NIC does not have the x-factor.


Well put... what constitutes the X-factor? And the shares that have it just seem to float like helium-filled baloons?

I bought NIC aeons ago at 60/= when I was a young impetuous trader; before I knew some baloons (like those during promulgation) actually sink.

Magnetic Touch
#10 Posted : Thursday, May 12, 2011 2:06:07 PM
Rank: Member


Joined: 12/31/2008
Posts: 90
muganda wrote:
[quote=Magnetic Touch]Well put... what constitutes the X-factor? And the shares that have it just seem to float like helium-filled baloons?

I bought NIC aeons ago at 60/= when I was a young impetuous trader; before I knew some baloons (like those during promulgation) actually sink.



Excitement, machismo, a certain Magnetic Touch. NIC does not have all these - just look at the number of contributions or views. If it were Equity, you would see.
the deal
#11 Posted : Thursday, May 12, 2011 4:06:34 PM
Rank: Elder


Joined: 9/25/2009
Posts: 4,534
Location: Windhoek/Nairobbery
NIC Bank 1Q 2011 Earnings Analysis

2011 vs 2010 (KSh Billions)




Total Interest Income 1.3 vs 1.1
Total Non Interest Income 0.47 vs 0.48
Total Operating Income 1.4 vs 1.1
Total Operating Expenses 0.62 vs 0.58
Profit Before Tax 0.80 vs 0.52
Profit After Tax 0.55 vs 0.35
EPS 1.4 vs 0.87

Commentary

Strong results once again from the local banks, i really cant find flaws in their perfomance apart from the increase in staff costs which surged a little bit this quater otherwise its a good job done by NIC Bank and i believe the mid tier banks in Kenya still have a lot of room for growth. On a straight line barring any hiccups Year end EPS will be Ksh 5.6 that will give a forward PE of 8.2 at the closing price of Ksh 46 which is quiet CHEAP and to me NIC Bank is a BUY at this levels.

Courtesy of http://contrarianinvesti...1-earnings-analysis.html
2012
#12 Posted : Thursday, May 12, 2011 4:17:31 PM
Rank: Elder


Joined: 12/9/2009
Posts: 6,592
Location: Nairobi
2009 to Q1 2010 was not a very good tidings for many economies so I'll wait and compare Q2 and Q3 before I consider this counter. Equity on the other hand I can still see the shockingly long winding queues in their banking halls. I always wonder, are those guys withdrawing or depositing?

BBI will solve it
:)
mkonomtupu
#13 Posted : Thursday, May 12, 2011 4:33:06 PM
Rank: Veteran


Joined: 2/10/2010
Posts: 1,001
Location: River Road
@deal, it's a buy for me once i saw the results just told my brokers buy more apart from the increase in staff costs the rest of the figures look quite solid and sustainable. It may not have the x-factor but at least it's a cheap stock for now
Gordon Gekko
#14 Posted : Thursday, May 12, 2011 4:46:18 PM
Rank: Elder


Joined: 5/27/2008
Posts: 3,760
Cleared my decks at 46 ex all. Now just waiting for the bonus to be updated then I start again, maybe at 42 - yes we will get there.
lovely2010
#15 Posted : Thursday, May 12, 2011 6:12:08 PM
Rank: Member


Joined: 10/25/2010
Posts: 519
Location: nairobi
muganda wrote:
Magnetic Touch wrote:
Clearly, NIC does not have the x-factor.


Well put... what constitutes the X-factor? And the shares that have it just seem to float like helium-filled baloons?

I bought NIC aeons ago at 60/= when I was a young impetuous trader; before I knew some baloons (like those during promulgation) actually sink.



I also bought @ 60 but i have no reason to complain...look @ it this way...if you bought it 3 yrs ago & you have been receiving bonuses e.g 1000 shares thats 100 bonus. 100*current price46=4600. Your current loss 1000*14=14000-4600=9400 (figures excluding broker fee) and if you have been buying it @ a lower price hata 42 you would have reduced the loss or maybe even covered the losses and you would not be complaining...just my thought....
The Merchant
#16 Posted : Thursday, May 12, 2011 9:38:04 PM
Rank: Veteran


Joined: 5/24/2010
Posts: 846
Location: KENYA
@lovely, I agree. Time always takes care of a little mishaps here and there. I am waiting for your response on the other thread about the other thing ;-)
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