While several companies are feeling the brunt of the Coronavirus outbreak in Nigeria, with their revenue or bottom line suffering from the economic fallout of COVID-19, there are some companies and sectors within the country, that are weathering the storm and cashing-in on the disruption caused by the virus outbreak.
The pandemic has been a blessing for most of these companies at a period COVID-19 serves as a curse for many. Basically, the pandemic changed their status to essential and tilt the market in their favour. Although, this change in fortune met most of the companies unprepared, as some struggle to meet demand which has skyrocketed. Still, in the business world, it is a good problem to have.
But before diving into companies that coronavirus has made lucrative, let's run through companies whose businesses have been crippled and forced into skeleton operation by the COVID-19 pandemic in Nigeria. For these companies, revenue and profit of the last month of Q1 and Q2 have gone with the onslaught of COVID-19.
Some companies suffering from COVID-19 outbreak
Manufacturing companies: From the cement makers like Dangote and BUA Cement, to Fast Moving Consumer Goods producers like Nestle, Rite Foods, as well as the Fashion industry, the Beverage industry and many more, there has been a standstill in operation of companies under the manufacturing industry. This sector is one of the most affected.
Due to the need for personnel to manufacture their goods and products, they were some of the most exposed to the adverse effect of the lockdown or restriction placed on movements. While some conglomerate in the manufacturing industry might have technology or machines to serve some purpose, there were no personnel to operate them either.
Airline companies: This industry was affected globally because of the restriction on movements. Even after the easing of the lockdown, the aviation industry has remained under lock and key. Already, some airline companies have been laying off their staff and slashing their salaries. According to the Minister of Aviation, Hadi Sirika, Nigerian aviation industry loses N21 billion monthly to COVID-19.
The impact of COVID-19 on the aviation industry has spiraled, affecting other businesses attached to flight business. For instance, Booking agencies reported a significant drop in flight bookings and reservations. Their businesses have been paralysed with only humanitarian flights allowed globally, including Nigeria.
According to the International Air Transport Association (IATA) updated analysis, the COVID-19 crisis will cause airline passenger revenues to drop by $314 billion in 2020; this represents a 55% decline compared to 2019. "Airlines could burn through $61 billion of cash reserves in the second quarter alone. That puts at risk 25 million jobs dependent on aviation,” said Alexandre de Juniac, IATA’s Director General and CEO.
Cinema companies: Screens across Cinemas have been turned off for close to three months now. No one is going to the cinemas to watch their favourite actors as government has lockdown the cinema business. Due to its large gathering tendency, it is believed the cinema could further spread the virus, hence, the directive to shutdown.
This has led to the loss of revenue for the cinema houses in Nigeria as they couldn't cash-in on the Easter period and will also be unable to generate income from the Ramadan period this month. For the three months Genesis Delux Cinema, Filmone Cinema, Silverbird Cinema and Ozone Cinema have remained on lockdown this year, they had made a killing in revenue compared to the corresponding period last year.
In March last year, according to statistics from the Cinema Exhibitors Association of Nigeria (CEAN), Cinema houses made about N434.4 million in revenue, In April, over N734.1 million was generated, N367.4 million was grossed in revenue for the month of May 2019.
Banking Industry: The commercial banks in Nigeria were also affected by the outbreak of coronavirus. GTBank, Zenith Bank, UBA, Access Bank, First Bank and many more were forced into skeleton operation by the pandemic, with most of their staff told to stay back at home while bank transaction-level dropped.
The impact of COVID-19 on banks was brought to the attention of Nigerians when the Chief Executive Officer of Access Bank, Herbert Wigwe stated that the bank will have to let go of some of their tellers and non-essential workers. Also, the Central Bank of Nigeria (CBN) had to issue a directive banning banks from downsizing.
Car-hailing services: For the tech-driven taxi companies, demands and rides haven't been the same since the coronavirus outbreak. Uber had reported a sharp decline in rides. The ride-hailing drivers who spoke with AllNews also complained that revenue had dropped significantly.
For ride-hailing drivers on Uber and Bolt platform, drop in demands, drag down rides and revenue as well. Pre-COVID-19, the drivers in Nigeria use to account for 15 to 20 rides daily, generating close to N20,000 daily, but since the outbreak of coronavirus, revenue has dropped to about N2,000 daily, while some drivers struggle to get demands.
Entertainment industry: Nigerian musicians and movie celebrities have been idle during the pandemic. For the artists, there have been no show, as all gigs, concerts and events have been cancelled locally and internationally. Artists like Davido and Asa have had to cancel their tours. Davido and Seyi Shay have complained about the impact of the coronavirus on their income.
Meanwhile, movie production have been paused, with actors and actresses having to depend on their previous paychecks. Although, pay-TV company, DSTV, has said it will financially support actors, actresses and other creatives in the movie industry pending the time they return to locations and production resumes.
Companies gaining from coronavirus
While Coronavirus has been a problem for the aforementioned companies, it has been a blessing for other sectors. Companies in these sectors gaining from the COVID-19 disruption have been resilient amidst the outbreak and sailing through the storm.
Telecommunications industry: The network providers have been the envy of many companies during this Coronavirus pandemic as the telecom market has been resilient. The industry which consists of MTN Nigeria, Airtel Nigeria, Glo and 9mobile has seen its demands increased compared to pre-COVID-19.
Data and voice revenue surge due to work-from-home program initiated by some companies after the lockdown. Also, people's dependence on social media for entertainment translated into huge gains for the network providers, as consumption of data increased.
Delivery services: This is one business that went from zero to 100 within the pandemic. The coronavirus outbreak turned the delivery service into an essential service that couldn't be overlooked. All store owners, online markets and food vendors began to rely on delivery services.
The budding industry which consists of GIG Logistics, Kwik Delivery, and many more became the toast of business owners. Even the Lagos State Government stated that it noticed a spike in the number of Courier/logistics operators within the state. Now, there are speculations that the government plans to reinforce a permit requirement of N2 million on delivery services.
Fintech payment startups: COVID-19 has changed the way people live. It has refocused attention of households and businesses to online payment for transaction of business. Online payment has seen a boost following the lockdown.
Due to fear of contacting coronavirus and restriction placed on movements, people now prefer to make payment through Fintech platforms offering payment services. The likes of Paystack, Jumia Pay, Konga Pay are fintech platforms leading the payment space. In it's Q1 financial reports, Jumia had disclosed that its payment platform had grown significantly, aiding the e-commerce firm's revenue for the period.
E-commerce firms: The online marketplace firms have also reported increase in demands, with store owners and manufacturers applying to list their items on their platforms in order to mitigate the impact of coronavirus and reduce their exposure to the risk of COVID-19.
As earlier stated, the change in shoppers behaviour amidst the Coronavirus outbreak has resulted into increase in demand for e-commerce companies like Jumia and Konga in Nigeria. To cap it up, both companies also have their payment solutions; Jumia Pay and Konga Pay, making them a hot cake.