Downtime is best time to invest in assets – Ugoji

Ugoji Lenin Ugoji is the Group Managing Director of C & I Leasing Plc. In this interview, he speaks about why people should invest more during crisis periods like the COVID-19 era, and his vision for his logistics company.

What is the operational focus of your company?

C&I is quite a diversified business, a logistics player in the vehicle fleet management as well as marine fleet management business. We also have a very strong outsourcing business that cohabits with other businesses we do. It has had a very strong growth due to its competence and has made the company a very strong brand in the areas of fleet management and logistics as well as marine business. 

We are going to do a lot of trying to improve our technical proficiency and service delivery.

What is the impact of COVID-19 on the activities of your business? 

It indeed impacted our business quite substantially because it affected the oil and gas industry which we service and C&I was very proactive in being able to transit to a more online methodology of carrying out its business and we have been able to maintain that same level of efficiency over the last two years despite the impact of the pandemic. 

We think we should expect to see greater input in terms of revenue in the coming years because we expect the oil industry to get back to some of its old rates in terms of diesel leasing and other ancillary services. So, we believe that it will positively impact the organisation in the coming months. 

We also intend to grow our core business of fleet management and outsourcing to be able to look out for some of the opportunities we noticed in the market in the past year.

COVID has brought a changing dynamic to the way businesses are run and I think C&I is poised to transit into that space.

How are you leveraging the digital space to expand your business?

C&I has some digital offerings. For example, it has a ‘get a job’ platform that is targeted at being able to secure the right type of human resources for various types of organisations. 

As a company, we have already-made services for some of these organisations with regard to logistics provision in terms of fleet management. We have other offerings with regard to fleet management. We have solutions that can help organisations that have large fleets, to be able to manage their fleet by themselves by just utilising some of the software that we have.

Tell us about the success of your majority shareholder, Peace Mass Transit, since it came on board?

I think it is pretty obvious that there is a very good fleet there and our businesses are a bit similar. Yes, the Peace Mass Transit group is primarily in the retail end of the fleet and transport operations business while C&I primarily focuses on the wholesale aspect of the business. So there is a clear value position in terms of the handshake that will be able to deliver value across the chain. 

A lot of that is being looked at right now and we are putting out some aspects of our operations in order to reduce costs in the business. So, the group has committed to supporting the company in all ways possible and we are already seeing that support taking place.

What investment opportunities are you looking at?

There are quite a lot of opportunities in Nigeria, largely stemming from our infrastructure. C&I as a premier and top-rated logistics provider in the area of transportation in vehicular and marine subsectors, there are opportunities here. 

Strategically, we will need to focus a lot of our investment drive on our vehicular fleet business because we feel that there are quite a lot of opportunities. From a strategic perspective, we look at growing that part of our portfolio so as to balance out our overweight position in the marine sector. 

We feel that the marine sector is also ripe for some form of intervention but we are going to be very picky about the way we look at that sector because of some of the challenges that exist. 

We must know that in every asset class, more or less, when there is downtime it is actually the best time to invest. It is like buying shares, it is better to invest when the prices are low.

We look at it as there is opportunity across all the business focus areas. C&I Leasing will move in that direction but on a partnership and collaborative basis.

Companies are cutting costs with the COVID-19 effect, does that apply to your firm? 

COVID-19 has changed our investment landscape and lives in general. It is important that we are able to adapt in a way to manage the resources of the company better and as a result of that, we have transitioned to a largely work-from-home IT infrastructure. 

We have been working from home for over two years and we have been able to effectively have the same impact on our clients. If you look at our recent results, yes there have been challenges in the areas of revenue growth, but there have been some positive areas in the cost indices. 

The main thing is for a continuous improvement in our processes because we are a process-driven organisation and trying to improve on those processes because we believe that these will cut down transaction time and lead to greater top-line revenues.

What is the level of your investments in the maritime sector?

C&I is one of the first beneficiaries of the Nigerian Content Law and it has since then played a prominent role in driving Nigerian content in the oil and gas industry.

It has had its ups and downs and we currently know that over the past two to three years, the oil and gas industry went through some challenges in terms of the downward trend of prices from the impact of the COVID. That affected some of the cost matrices because it is such a tactical industry that focuses a lot on health and safety. 

We have also had challenges with the issue of the daily rate from the International Oil Companies (IOCs). However, what we have done specifically was to look inward at the vessels within the fleet and the industry for the prognosis of short- and medium-term effects. 

We feel that the industry still requires vessels to service the upstream sector, especially with some of the security challenges in some parts of the Niger Delta where a lot of this oil is drilled. So, C&I focuses and plays strategically in that market and we see that the opportunity for that market still exists quite strongly.

We are going to aggressively retool the vessel fleet, not necessarily buying new vessels      –unless there are specific opportunities. Currently, we have a fleet of about 22 vessels and we intend to ensure that they are up to speed to be able to take advantage and the opportunity wherever we see that. But in terms of collaboration, we are continuously doing that with our local and foreign partners.