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Deap Capital: Battling Downturn in Business
- By Kayode Ogunwale
- Published May 3rd, 2010
- StockWorld
- Unrated
DEAP Capital Management & Trust Limited (DEAP CAPITAL) is a limited liability company duly incorporated on June 5, 2002 and licensed by the Securities and Exchange Commission (Sec) to carry on a wide range of capital market businesses. The core business of DEAP CAPITAL at inception was funds/ portfolio management. However the company has since broadened its range of services to include venture capital for small and medium scale industries and issuing house services to corporations and institutional investors. Through its subsidiaries and affiliates, DEAP CAPITAL also offers first class services in stockbrokerage, mortgage banking, and project management/financing in the oil & gas sector. As at the end of June 2006, the company’s the paid-up capital is N231million. Accordingly after just three full years of operation, asset base rose to N1 billion while funds under management increased to N731 million.
The objective of DEAP is to exploit global experience of over 71 years experience in investment banking/capital market to manage funds specifically tailored to meet the investment requirements of their clients by dealing actively in the capital market and to achieve satisfactory returns to their investors and reward company staff appropriately. The company target market is clearly the high net-worth individuals and institutions capable of investing a minimum of one million Naira and above for a minimum of 180 days.
DEAP is a hybrid financial institution operating in the main as a fund management company utilizing own resources together with other investors’ funds to trade actively in the 20 best companies quoted on the Nigerian Stock Exchange. At the same time, funds invested with DEAP by some of its clients for funding of oil & gas contracts are managed professionally through its associate company DVCF Oil & Gas Plc. At the conclusion of the business cycle, profits made are shared between providers of funds and DEAP CAPITAL, the fund manager.
Financing
Authorized share of Deap Capital Plc was 3 billion ordinary shares of 50 kobo each worth N1.5 billion in 2008 and was unchanged in 2009.The fixed assets of the company dropped from N83.628 million in 2008 to N61.165 million as at the end of 2009 indicating a decrease of N22.463 million or by 27 per cent. The company’s current assets dropped by 20 per cent or N1.330 billion to N5.276 billion in 2009 from N6.605 billion in 2008. Its current liabilities stood at N5.734 billion at the end of its 2009 financial year. This represents a N2.028 billion growth or 55 per cent in the company’s liabilities compared with its 2008 figure of N3.706 billion
Profitability
Deap Capital recorded a turnover of N1.334 billion in 2008 indicating a depreciation of N850 million or 64 percent to stand at N483.510 million. It recorded profit before taxation of N396.076 million in 2008 and a loss of N567.060 million in 2009.Profit after taxation was N343.847 million in 2008 and in 2009, it recorded a loss of N2.114 billion.
Liquidity
In 2008, current ratio was 1.8:1, as it dropped to 0.9:1 in 2009. This means that in 2008, its current assets can cover 180 per cent of its current liabilities. And in 2009, situation also changed as its current assets can only covered 90 per cent of it.
Management
The board of directors of DEAP is made up of 13 members comprising 12 individuals and one institutional investor. The company has a 14 member board of directors made up of people with distinguished career in diverse sectors both locally and in the global scene. Mrs. Victoria Oyinlola Alo is the chairman of the board and Barr. Vincent Otiono is the vice chairman; Mr. Emmanuel Ugboh is the managing director of the company.Mr. Anthony Eze is executive director of the company, other members of the board are Mr. Jonathan O. Idudu, Mr. Peter Ololo, Chief Sylvanus Ezendu, Mrs. Clara Rotzler, Mr. Gabriel Ogbechie, Chief Ifeanyi Nwagwu, Hon. Preye Ogriki, Barr. Gordons Ejikeme and Mrs. Treasure Sam-Afolayan.
Score Card
DEAP Capital Management & Trust Plc (DEAPCAPITAL) is a public limited company with authorized share capital of N1.5 billion and a paid up capital of N750 million. The company has an asset base of over N4 billion with funds under management in excess of over N3 billion. It was incorporated on June 5, 2002 and is registered with the Sec as funds/portfolio manager.
The company rewarded investors and shareholders from profit made. DEAP CAPITAL is able to offer higher returns because it invests solely in the best 20 companies listed on the stock exchange which it monitors constantly taking advantage of the strategic alliance with Resort Securities & Trust Limited the stock broking firm that carries out its mandates on stock trading.
The performance of the company during the year under review was not impressive as it recorded dividend huge losses in turnover. The company recorded a turnover of N850 million or 64 per cent depreciation in 2009, from N1.334 billion in 2008 to N483.510 million.
It recorded earning per share of (127) kobo in 2009 against 21 kobo in 2008 financial year. However, the loss in the company during the financial year under review was attributed to the challenges that tasked operators in the financial and other sectors both domestically and globally.
The objective of DEAP is to exploit global experience of over 71 years experience in investment banking/capital market to manage funds specifically tailored to meet the investment requirements of their clients by dealing actively in the capital market and to achieve satisfactory returns to their investors and reward company staff appropriately. The company target market is clearly the high net-worth individuals and institutions capable of investing a minimum of one million Naira and above for a minimum of 180 days.
DEAP is a hybrid financial institution operating in the main as a fund management company utilizing own resources together with other investors’ funds to trade actively in the 20 best companies quoted on the Nigerian Stock Exchange. At the same time, funds invested with DEAP by some of its clients for funding of oil & gas contracts are managed professionally through its associate company DVCF Oil & Gas Plc. At the conclusion of the business cycle, profits made are shared between providers of funds and DEAP CAPITAL, the fund manager.
Financing
Authorized share of Deap Capital Plc was 3 billion ordinary shares of 50 kobo each worth N1.5 billion in 2008 and was unchanged in 2009.The fixed assets of the company dropped from N83.628 million in 2008 to N61.165 million as at the end of 2009 indicating a decrease of N22.463 million or by 27 per cent. The company’s current assets dropped by 20 per cent or N1.330 billion to N5.276 billion in 2009 from N6.605 billion in 2008. Its current liabilities stood at N5.734 billion at the end of its 2009 financial year. This represents a N2.028 billion growth or 55 per cent in the company’s liabilities compared with its 2008 figure of N3.706 billion
Profitability
Deap Capital recorded a turnover of N1.334 billion in 2008 indicating a depreciation of N850 million or 64 percent to stand at N483.510 million. It recorded profit before taxation of N396.076 million in 2008 and a loss of N567.060 million in 2009.Profit after taxation was N343.847 million in 2008 and in 2009, it recorded a loss of N2.114 billion.
Liquidity
In 2008, current ratio was 1.8:1, as it dropped to 0.9:1 in 2009. This means that in 2008, its current assets can cover 180 per cent of its current liabilities. And in 2009, situation also changed as its current assets can only covered 90 per cent of it.
Management
The board of directors of DEAP is made up of 13 members comprising 12 individuals and one institutional investor. The company has a 14 member board of directors made up of people with distinguished career in diverse sectors both locally and in the global scene. Mrs. Victoria Oyinlola Alo is the chairman of the board and Barr. Vincent Otiono is the vice chairman; Mr. Emmanuel Ugboh is the managing director of the company.Mr. Anthony Eze is executive director of the company, other members of the board are Mr. Jonathan O. Idudu, Mr. Peter Ololo, Chief Sylvanus Ezendu, Mrs. Clara Rotzler, Mr. Gabriel Ogbechie, Chief Ifeanyi Nwagwu, Hon. Preye Ogriki, Barr. Gordons Ejikeme and Mrs. Treasure Sam-Afolayan.
Score Card
DEAP Capital Management & Trust Plc (DEAPCAPITAL) is a public limited company with authorized share capital of N1.5 billion and a paid up capital of N750 million. The company has an asset base of over N4 billion with funds under management in excess of over N3 billion. It was incorporated on June 5, 2002 and is registered with the Sec as funds/portfolio manager.
The company rewarded investors and shareholders from profit made. DEAP CAPITAL is able to offer higher returns because it invests solely in the best 20 companies listed on the stock exchange which it monitors constantly taking advantage of the strategic alliance with Resort Securities & Trust Limited the stock broking firm that carries out its mandates on stock trading.
The performance of the company during the year under review was not impressive as it recorded dividend huge losses in turnover. The company recorded a turnover of N850 million or 64 per cent depreciation in 2009, from N1.334 billion in 2008 to N483.510 million.
It recorded earning per share of (127) kobo in 2009 against 21 kobo in 2008 financial year. However, the loss in the company during the financial year under review was attributed to the challenges that tasked operators in the financial and other sectors both domestically and globally.
