The Nigerian Stock Exchange (NGX) through its ‘Facts Behind The Figures’ (FBF) events, aims to provide listed companies the opportunity to inform the market of their financial performance as well as strategic and operational developments within their businesses. This is in a bid to keep the stock market transparent. At the FBF event that was held on Friday 24th September 2021, Uacn Property Development Company (UPDC) had the opportunity to do a presentation as well as answer questions emanating from attendees who included UPDC’s shareholders, and the general public. In this note, we have summarised the key facts from the presentation / Q & A session.

In attendance:

Odunayo Ojo, Managing Director, UPDC Plc.

Folakemi Fadahunsi, Chief Financial Officer (CFO), UPDC Plc.

Olutobi Onajin, Team Lead, CSR, Events and Sponsorships, Nigerian Stock Exchange.

Olumide Bolumole, Head, Corporate Communications, Nigerian Stock Exchange.

Olufemi Oyenuga, Chief Digital Officer, Nigerian Stock Exchange.

Who is UPDC? A brief background
Uacn Property Development Company, popularly known as UPDC is a Nigerian listed company, established in 1997, as a division and subsidiary of the UAC Group. The core activities of UPDC include the development and management of real estate products within the residential, retail, commercial, and hospitality segments of the market. The company got listed on the Nigerian Stock Exchange (NGX) in 1998, and subsequently set up its Real Estate Trust (REIT) division in 2013, with an initial equity stake of c.62%, now 43% according to the Company’s presentation. You can access the full video presentation here for more about UPDC and other facts behind its business.

Key facts from UPDC’s presentation

Operating track record

• Over ₦22 billion in Assets.
• Over 1,000 residential units have been constructed so far, with 30 Estates under management.
• 471 keys Festival Hotel, and a retail mall.

Recent Corporate Actions and Governance

• UPDC unbundled its interest in UPDC REITs to help it focus on its core activities.
• UPDC raised ₦16 billion in 2020 to strengthen its capital structure and position for profitability.
• Custodian acquired a 51% stake in UPDC with UAC and other shareholders retaining 43% and 6% respectively. Custodian’s majority share makes UPDC a subsidiary of Custodian Investment Plc.
• Mr. Wole Oshin who is the founder and CEO of Custodian Investment Plc is also now the Chairman of UPDC.

Financial Highlights as of June 2021

• Revenues ₦316,056,000 (9% decline from 2020 figures)
• Operating Profit ₦88,696,000 (60% growth from 2020 figures)
• Inventory ₦4,247,910,000 (20% decline from 2020 figures)
• Total Assets ₦22,041,868 (24% decline from 2020 figures) This dropped as a result of the unbundling of UPDC’s stake in the REIT.

Key Takeaways

The company’s revenue, inventory, and total assets declined in 2021 owing to the impact of the pandemic and the overall business environment in the country, however, the company has made significant progress in cutting down on operating expenses. With the new project that the UPDC is launching, Project Alpha, and some of its strategic moves (selling off non-performing assets for liquidity), we expect the company’s financials to improve over the coming years. has focused on restructuring its fundamentals over the past year, as they have worked on reducing debt and interest.

A highlight of some Questions and Answers

• What is UPDC’s plan to start generating positive cash flows?

UPDC’s bid to deepen its property development activity by focusing on the middle-income segment of the market where there is more sustainable demand, where they can deliver products that people need.

• When will UPDC become profitable?

UPDC is focusing on restructuring its capital base and is on its path to profitability. Part of the strategy for profitability includes disposal of low-yielding investment properties, the introduction of new developments for high-yielding property types, reduction of interest-bearing debts, etc. With this, UPDC will become profitable in the near future.

• What are the reasons for the declining revenue?

Declining revenues are a result of the reduction in customer’s purchasing power. Revenues can only be recorded at certain points when customers are able to completely pay. Flexible payment options, means that it takes even longer to record revenue. 

Click here to watch the full video of the UPDC facts behind the presentation of the figures on youtube.

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