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Royal Exchange Plc announces inability to submit financial statements

Royal Exchange Plc has announced its inability to present its Audited Financial Statement and Unaudited Financial Statement to the Nigerian Exchange Limited during the stipulated period.

In a statement signed by the company’s secretary, Ngozika Onu, the management of Royal Exchange Plc sought to advise the company’s shareholders as well as the investing public that the company is unable to submit its Audited Financial Statement for the year ended December 31, 2020, and Unaudited Financial Statements for the period ended March 31, 2021, to the Nigerian Exchange Limited (NGX) within the timeframe required by the NGX.

The disclosure stated that the Year-end audit exercise for the group is yet to be concluded as the insurance and finance subsidiaries are still awaiting approvals from their regulatory bodies, that is, the National Insurance Commission (NAICOM) and the Central Bank of Nigeria (CBN).

The Company further assured its shareholders and the investing company, stating that upon the approval of the respective financial statements of both subsidiaries, the consolidation of the Group’s accounts for the year ended December 31, 2020, will be concluded and released to the public.

In addition, the Unaudited Financial Statements for the period ended March 31, 2021 will be prepared and approved by the Board of Directors for submission to the NGX and Securities Exchange Commission (SEC).

The company stated that it is optimistic that the pending financial statements would be made available and submitted on or before September 30, 2021.

What you should know

On Friday, June 2, 2021, trading in the stocks of Royal Exchange Plc and 3 other companies were suspended by the Nigeria Exchange Limited (NGX).

This action was taken on the back of the companies’ failure to present for submission, their Audited Financial Statements for the year ended December 2020 or their Unaudited Financial Statements for the period of March 2021 or both.

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This penalty is embedded in the Rules for Filing of Accounts and Treatment of Default Filing which governs all listed companies on the exchange. Rule 3.1 states that:

“If an Issuer fails to file the relevant accounts by the expiration of the Cure Period, The Exchange will:

  1. a) Send to the Issuer a “Second Filing Deficiency Notification” within two (2) business days after the end of the Cure Period;
  2. b) Suspend trading in the Issue’s securities; and
  3. c) Notify the Securities and Exchange Commission (SEC) and the Market within twenty- four (24) hours of the suspension”.

Hence, the suspension in trading on the shares of Royal Exchange Plc will persist till September 30, 2021, if the company unfailingly submits both financial statements.

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