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Lead Fixed Income Fund, an open-ended fund managed by Lead Asset Management Limited, reported a 14.7 percent increase in its profit after tax (PAT) for the year ended December 31 2018, fuelled by the increase in new units of subscribers.
Data compiled from the company’s financials revealed that it grew PAT by N5.64 million, from N38.36 million reported in 2017 to N44 million in 2018.
In the review period, the Fund recorded 3.83 million units of new subscribers to the tune of N459.55 million in 2018, 32.37 percent increase when compared to the N347.16 million reported a year earlier.
“All expectation were met, the unit holders are actually happy- since the Fixed Income Fund was created, we have paid dividend twice in a year.I think we are doing very well, our current yields is about 13.6 percent, which is clearly above inflation rate and the indices are looking quite attractive even for Nigeria as a country,” Taiwo Olashore, Managing Director of Lead Asset Management Limited told BusinessDay at the company’s second Annual General Meeting (AGM).
Registered and authorized in Nigeria as a Unit Trust Scheme under Section 160 of the Investment & Securities Act, Lead Fixed Income Fund recorded a growth in revenue by 7.27 percent in the review year, from N47.99 million it generated in 2017 to N51.477 in 2018.
Thus, the Manager is proposing 25 percent dividend for full-year ended 31 December 2018 in line with the provisions of the Trust Deed. That is N2.08 dividend payment per unit to members whose name appears in the Register of the members as at close of book for the review year.
Commenting on her investment with the fund manager Oyekanmi Marian said “I am a subscriber with Lead Asset Management, I signed up with them in 2018 and I find it very interesting, because the way the Fund appreciated is very fast and made me realize the Fund is a serious business.”
BusinessDay analysis of the company’s investment options revealed that the Fund allocated its resources to: Treasury bill, Bonds, commercial paper and cash at bank in the year under review.
According to the company, asset Allocation requirement of the Fund was invested in accordance with the set Asset Allocation classes during the period under review.
The Fund invested 64.44 percent in Treasury bill, 19.57 percent in Bonds, 12.11percent in Commercial Paper and 3.8 percent in Cash respectively, data from its 2018 financial revealed.
During the year 2018, the fund’s asset allocation went through significant change s voted by unit holders in line with the trust deed with the following reason; to increase the number of units and value, reduced the minimum entry value to N5,000, which however still gave the fund an impressive performance in full year.
“If you had invested N100 in 2018, that amount today would have become N140, that an investment growth by 40 percent, which is actually not bad,” Olashore said.
Governed by a Trust Deed with United Capital Trustees Limited, a Trustee to the Fund, Lead Fixed Income Fund was established to provide investors and or their beneficiaries and dependents with long-term capital appreciation and to optimize investors’ total returns through investment in selected portfolio of securities and instruments.
Following the Fund’s performance for the year ended 13st December 2018, it envisaged that notable increases will be recorded in all areas of business operations in the year ahead with a view to improving its performance.
According to Francis Iyebutemeh, a Senior Analyst at Lead Asset Management Limited, “the company is on the path to give investors a better return than is has done in the past.”
Going into the year, the MD of Lead Asset Management limited told BusinessDay at the second AGM held recently in Lagos that the company wants to broaden its portfolio to present investors with different investment options.
“We want to offer different varieties of products, we recently concluded the IPO for Balanced Fund, which is also a combination of equity and fixed income instruments, and later in the year we’ll also launch our money market fund,” Olashore said.
Figures by the Securities and Exchange Commission (SEC), the industry regulator analyzed by BusinessDay for the week ended June 14 2019 revealed that the Fixed Income Fund controlled the highest share of the asset in the mutual fund market after money market fund.
The Net Asset Value (NAV) managed by Fixed Income Fund stood N79.57 billion, 10.64 percent of the entire NAV of N753.28 billion. This is N484.2 billion lower than the N563.77 billion managed by the money market fund which accounts for 75.38 percent of the entire mutual fund asset.