The Board of Directors of UPDC Plc has announced that NGX Regulation Limited (NGX RegCo) has granted the company a 24-month extension to comply with the Nigerian Exchange’s (NGX) free float requirements.

In a notification to shareholders, UPDC confirmed that the extension, spanning 2026 to 2028, provides the company additional time to meet the free float threshold required for firms listed on the NGX Main Board.

Under NGX regulations, companies listed on the Main Board must maintain a minimum free float of 20 percent of their issued and fully paid share capital or a free float market capitalization of at least N20 billion. The rule is intended to enhance market liquidity, strengthen price discovery mechanisms, promote transparency, and protect investors.

UPDC stated that the regulatory extension will enable it to resolve its current free float shortfall and restore full compliance with its post-listing obligations within the approved timeframe.

The approval aligns with Rule 3.1.4 of the Exchange’s Rules Governing Free Float Requirements, which authorizes the Exchange to suspend trading in a company’s securities if it fails to meet the stipulated free float threshold within the prescribed period.

By obtaining the extension, UPDC has mitigated the risk of a potential trading suspension while it undertakes measures to restructure its shareholding in line with NGX standards.

The Board and majority shareholders reaffirmed their commitment to corporate governance and regulatory compliance, emphasizing that strategic steps are being implemented to address the deficiency within the granted window.

Free float compliance remains a core listing requirement on the NGX Main Board, ensuring that a meaningful proportion of shares is held by public investors rather than concentrated among controlling stakeholders. Market analysts note that adequate free float enhances stock liquidity and broadens investor participation.

UPDC’s latest disclosure underscores its intention to maintain its listing status on the NGX Main Board while aligning fully with regulatory requirements over the next two years.

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The company’s latest financial statement reveals a profit of N10.9 million for the first six months of 2024, a significant improvement from the N231.2 million loss recorded in the same period last year.

The company’s operating profit also saw a positive shift, standing at N70.7 million compared to a loss of N1.58 million previously. Additionally, tax expenses declined to N60.7 million from N89.4 million. UPDC’s profit before tax surged to N71.6 million in H1 2024, up from a loss of N141.8 million in the first half of 2023.

Despite these gains, the firm experienced an increase in both selling and distribution expenses, which rose to N97.1 million from N37.9 million, and administrative expenses, which grew to N1.1 billion from N810.8 million.

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Revenue for UPDC increased by 20.5 percent year-on-year, reaching N2.59 billion from N2.15 billion in the same period last year. The breakdown of revenue shows N1.4 billion generated from selling property stock, N597.6 million from UPDC Hotel Limited, and N417.1 million from UPDC Facility Management Limited’s surcharge income.

However, the cost of sales claimed 79.9 percent of total revenue, impacting profitability. The cost of sales increased by 5.9 percent to N1.44 billion from N1.37 billion. Additionally, the company reported a gain in net finance cost, which stood at N865 million from a loss of N140.3 million in the same period last year.

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UPDC’s cash and cash equivalents during the period amounted to N4.5 billion, marking a 36.4 percent decline from N3.3 billion. Cash from operating activities decreased slightly to N533.3 million from N541.2 million, while net cash from financing activities was a negative N1.18 billion compared to N209.9 million previously. Conversely, net cash used in investing activities was a positive N232.8 million, an improvement from a negative N52.6 million.

With a market capitalization of N25.8 billion, UPDC Plc continues to focus on the acquisition, development, sales, and management of high-quality serviced commercial and residential properties in the luxury, premium, and classic segments of the real estate market.

The post UPDC Plc Records First Profit in Eight Years, Reporting N10.9 Million in H1 2024 appeared first on Housing TV Africa.