Maritime company C&I Leasing completes issuance of second tranche for its bond programme

NIGERIAC&I Leasing, a Nigerian public limited maritime company, has completed the issuance of the second tranche of its N20 billion (US$48.45m) bond programme which it started in 2017.

The company, which is Nigeria’s only listed leasing company also said it is optimistic that a new business model which it adopted, would help in driving revenue growth and further improve the profitability of its business from 2021 and beyond.

According to a statement, at 100 per cent subscription rate, the long-dated instrument was a N10 billion bond (US$24.22m), issued at a coupon rate of 15.5 per cent. The firm had earlier in 2018, issued the first tranche of N7 billion (US$16.96m).

The leasing firm which has its core business operations in Nigeria and Ghana is investing significantly in its digital business, after the pandemic affected fleet business operations across the globe, causing a decline in revenue.

The firm has launched into the market three digital products, two of which are in its fleet management business, and the other in the personnel outsourcing, according to the Managing Director/CEO of C&I Leasing, Andrew Otike-Odibi.

“C-Ride, which is one of the new products of the firm in its fleet management business, is a hailing business/car-sharing software, which it deploys to corporate bodies,” the statement explained.

“This enables the businesses secure reliable mobility for its staff without having to invest in fixed assets. C&I Leasing gives them a pool of vehicles that they can call on anytime they need. This software can also be deployed to optimise the fleet of a company as it ensures efficient allocation of resources.”

It quoted the CEO to have said: “In providing this service we are putting on the table our skills and pedigree as having managed a logistics company in the past 30 years by providing relatively new vehicles, trained drivers with good safety records.”

According to the statement, the FMS 360, which is another product developed to disrupt its fleet management business, is a software that helps companies better manage the data of their fleet in terms of fuel monitoring and driver management.

The firm has developed Skills Central, a virtual training software, Otike-Odibi said, noting that the firm has more in the pipeline as it is putting a lot of resources in the digital space to grow the business.

According to him, the funds for the development of the new products for digital business is coming from the operating cash flow of the organisation.

“With the increasing adoption of digital technology in servicing changes in consumer demand and consumption pattern following the pandemic, the firm is banking on investments in its digital business to grow future revenues. The investments may not have a strong impact on our revenues this year,” he said.

“What we are looking out for is from 2022 and beyond, such that our non-asset related income will go up to as much as 20-30 percent. Hence our objective is that in the year 2022/23, we will see more of the digital side of the business generating more revenue than it has done in the past.”

Otike-Odibi, explained that proceeds from the bond sales would be used to refinance short-term debt in its books, and not really to be invested into new business.

According to him, the process started last year when rates were a lot cheaper, and at the time, the company was projected to have a coupon rate of 10-11 per cent.

“However, the remote working slowed the process down, and by the time we finally got approval from the regulators and came to the market, rates had already started inching up and we got caught,” he said.

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