GTCO Earnings Surprise Beats Analysts’ Estimates

GTCO Earnings Surprise Beats Analysts’ Estimates

Guaranty Trust Holding Company Plc (GTCO) reported a 185.3% year-on-year growth in its earnings per share (EPS) for 9 months of the financial year 2023 scorecard. The group beat analysts’ estimates after a surprise surge in profit after tax.

This appears to be the first time the group delivered an eye-popping, industry-leading earnings performance since it switched to the Holdco structure. The results reverberate throughout the Broadstreet and its share price reacted positively in the stock market.

In its latest filing submitted to the Nigerian Exchange, the group reported that its EPS accelerated to N12.98 from N4.55, supported by the sturdy growth across the group’s core and non-core income lines.

The financial services company grew Interest Income by 61.1% year on year to N374.6 billion, a feat supported by driven by improved operating activities and a higher interest rate environment.

Having an expanded loan book, GTCO’s net loans and advances to customers jumped by 17.7% in 9M 2023 relative to December 2022 -inclusive of the impact of the devaluation of foreign currency loans. 

The bank has been very reluctant to increase risk assets amidst the negative headwinds, according to analysts.

On the other hand, interest expenses also grew strongly, up 79.9% year on year to N77.0 billion. Customer Deposits grew moderately, up 39.3% in September 2023 compared with December 2022.  Overall, Net Interest Income grew 56.9% year on year to N297.5 billion.

Non-interest income (NII) grew by 231.1% year on year to N407.83 billion, spurred primarily by the revaluation gains of about N306.96 billion in the second quarter of the year.

The results showed a steep jump in income generated from fees and commission, up by 41.5% year on year to N82.48 billion.  On the other hand, the group reported N55.62 billion in losses in investment securities.

Further down, GTCO’s operating expenses grew by 31.0% to N182.70 billion, with the most pressure stemming from personnel expenses, deposit insurance premiums, and AMCON levy.

Overall, profit before tax advanced by 155.2% year on year to N433.20 billion, while profit after tax grew faster by 181.9% to N367.42 billion, after accounting for N65.79 billion income tax expense. #GTCO Earnings Surprise Beats Analysts’ Estimates  Nigeria Eurobond Slumps after CBN Resumes OMO Auction

Analysts views on the result coming here…watch out