Computer Warehouse Group PLC Lists Her Shares On NSE

                      

On November 15, 2013, Computer Warehouse Group Plc (CWG) shall be the first company to be listed on the Nigerian Stock Exchange following the launch of the new trading engine, X-Gen, which incidentally is the same engine that is used on the NASDAQ. The listing of the shares is expected to boost the market capitalisation of the NSE with about N14 billion, while CWG would be the highest capitalised security in the ICT sector of the exchange.

The NASDAQ and the NYSE have also recently witnessed a boom in Technology listings with Facebook, Google and LinkedIn. Twitter has also recently revealed her listing plans. This seems to be the golden ageof technology companies, as the stocks have done outstandingly well post listing. For instance, Google’s shares have gained a whopping 773% post listing while LinkedIn and Facebook have gained 160% and 29% respectively (as at October 04, 2013). Twitter seems set to follow in this trend with quarterly revenues up 105% to $139m from a year ago.

Here in Nigeria, CWG’s story has not been different. With seed capital of about N160,000 in 1992, CWG received a valuation of N6.97billion in 2009 from Vetiva Capital for her private placement. The issue was oversubscribed; with Private Equity firm Aureos Capital LLC taking up a major chunk, defying the gloomy atmosphere of the global economic downturn at that time. The valuation resulted in an increase in invested capital of 4,400 times, meaning that an initial investment of $1000 in 1992 would have yielded a whopping $4.4m within just 20 years. This achievement put the company in the bracket of the one of the best global value creators. CWG seems to be on track to repeat this feat on her listing, at a target share price of N5.48, almost doubling her private placement price of N3.40 in 2009 albeit in a very difficult environment characterised by significant slowdown in global economic growth. 

It is therefore not surprising that that the Ministers of Finance, Trade and Investment and Communication Technology recently joined hands with the CEO of the Nigerian Stock Exchange to aggressively canvas for more Technology listing towards achieving the goal of the NSE to reach a market capitalisation of $1trillion within a decade.

CWG’s Founder and Chief Executive Officer, Austin Okere confidently declares that “our best is yet to come”, amidst comment from sceptics that all previous Technology listings on the Nigerian Stock Exchange have lost significant value. Hear him; “the value of the stock is affected by performance andperception of potential. The stock also reacts negatively to swings in revenue, preferring predictability in forecasts”. He continues “CWG has over the years built a large proportion of her turnover into annuities from deploying her own Intellectual Property (IP), to enable financial inclusiveness in Mobility, such as the recently announced Yello Diamond Account, which will bring banking services to over 55 million Mobile phone subscribers, and the MTN XaaS product, which will provide Financial services in the cloud for the over 1000 Microfinance banks and their customers on a pay as you use basis”. The product rides on cloud computing to bring competitive advantage to relatively smaller banks which would otherwise have been disenfranchised. According to him about 12 of the large banks in Nigeria run on the Finacle Core banking Application, which CWG jointly promotes in West Africa with the application developers, Infosys of India, processing over 60% of all financial transaction in Nigeria and used by the likes of FBN, UBA, Stanbic IBTC, Fidelity and FCMB amongst others.

CWG has taken advantage of her early mover status in the surge in ICT outsourcing demands to provide the service for the largest telecommunication company and the largest Downstream Company in the Oil & Gas sector in Nigeria. This further assures annuity income that smoothes revenue swings and brings predictability to income. According to Austin, about 80% of the company’s revenue is from repeat business, and new customers are more likely to be from referrals.

CWG is a strong player in the ATM business, providing and supporting over 30% of the country’s ATM installed base in conjunction with Wincor-Nixdorf of Germany, global leaders in the field.

Being a skills intensive business, CWG has set up an Academy to train brilliant youngsters to boost her talent pool. Currently, the CWG Academy trains over 200 graduates per year in Nigeria and Ghana, and is set to start in Uganda by mid next year. The company currently employs over 650 people, of which about 80% are engineers, with extra certifications in Cisco, Oracle, IBM and other Original Equipment Manufacturing (OEM) platforms. The Company is ISO 9001:2008 certified across all her operations.

  

The stellar performance of the Company has been rewarded by her peers and regulators with such awards as Top 50 Technology Business Companies in West Africa, ICT Solutions Provider of the year, ICT Company of the year, and the CEO as ICT Personality of the year 2012.

CWG has garnered a track record over the years as one of the most admired companies in Africa. In 2009, the Columbia Business School in New York published a case study on the Company and appointed Austin Okere as an Entrepreneur in Residence (EIR), while in 2012, the Legatum Entrepreneurial Center of MIT Boston, published a video and written case study on the Computer Warehouse Group as well.

For the second year in a row, CWG was awarded the Most Outstanding Corporate Social Responsibility (CSR) Technology Company of the year in 2012. The company has continued to support her host communities by ingraining social responsibility as an integral part of her business model, with focus on the education sector.

In the quest to be the leading Pan African ICT Company, CWG has actualised her geographical expansion plans with operation in four African countries; Nigeria, Ghana, Uganda and Cameroon, and virtual operations in 17 other countries. The Company has 18 offices and support centres across Nigeria, including Lagos, Abuja and Port-Harcourt.

 The company seems well set to achieve her vision of being the number one IT Utility enabler in Africa by 2015.