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Tag: Shareholders

  • Anambra, shareholders clash over demolished bank

    Anambra, shareholders clash over demolished bank

    The bickering between the Anambra State Government and shareholders of Awka Micro-finance Bank Limited is disquieting. It is over an alleged demolition of the micro-finance bank at the popular Eke-Awka Market by the state government.

    While the shareholders claimed they acquired the land from the government in 2003, the state government refuted the claim, stating that the land belongs to it.

    The said micro-finance bank building was demolished by the government on September 9, this year, without consulting the said owners.

    The incident occurred after the state government was said to have approved a new building for the shareholders on June 13, this year.

    Documents made available to our correspondent revealed that the Anambra State Government had leased the land to the Awka South Local Government Area for 99 years beginning from January 1, 1996.

    However, it was gathered that the local government agreed to sublet a portion of the premises which contained a six-room bungalow for a period of 25 years.

    Also, in the agreement, it was agreed that the shareholders would be paying N36,000 annually to the local government after every 10 years beginning from 2003.

    However, the agreement has allegedly been altered with the intrusion of the state government into the land penultimate week when the bank was demolished after the shareholders had paid for another 10 years to the local government area, to run till 2023.

    The state government argued that it wants to build a food court for traders in the market; a deviation from the original plan by the shareholders to erect a befitting edifice for the bank.

    A contracting firm engaged by the state government to build the food court had written a letter to the Commissioner for Commerce, Trade and Tourism, Ifeatu Onejeme, on September 1, this year, on the need to take over the land.

    Replying the letter on September 3, this year, the commissioner said the construction must be in strict compliance with the building plan.

    Part of the letter reads: “On completion of the project, pay to the Anambra State Government the approved Market Development fees of N30,000 per stall.”

    But the shareholders alleged that what is being built is not what government approved in the plan on June 3, this year before the demolition of the bank on September 9, 2014.

    Our correspondent gathered that due process was not followed in the award of the contract as the contractor applied to take over the land on September 1, this year and the contract was awarded on September 3, without any form of bidding.

    One of the Directors of the bank, Chief Dilim Okafor, told our correspondent that if the government is sincere in what they are doing, why charge N30,000 for each stall while a shop in the area goes for N1.5 million. Does it not show sign of fraud?

    Okafor alleged that all the property of the bank worth over N200 million, including documents, are missing since the demolition of the place.

    Also speaking, another Director of the bank, Ozo James Eze, told our correspondent that what Onejeme was targeting is to pitch the shareholders of the bank against Governor Willie Obiano.

    Eze said they were convinced that Obiano could not have ordered the demolition of the bank, since he had been an apostle of development.

    Okafor revealed that majority of the shareholders of the bank are members of the Awka Development Union (ADU), even as he added that the government had infringed on their fundamental human rights.

    Furthermore, he claimed that the micro-finance bank had over 300 shareholders, adding that they would challenge government’s forcible ejection in court.

    However, Mr. Onejeme told our correspondent in Awka that those claiming ownership of the land were just trying to cause unnecessary confusion.

    He said there was no bank on the land as being claimed by the shareholders in the first place; adding that what was seen on ground was a kiosk.

    “Besides, they claimed that members of the Awka Development Union (ADU) have major interest in the so-called bank. Do I have anything there? Am I not an Awka man? Their action is an act of irresponsibility.

    “Nobody gave them any land. All the documents they are fronting are all faked. How can few people gang up to claim government’s land just like that?

    “That land belongs to the government. We learnt they want to go to court, we are waiting for them. There is no going back in making sure that this administration eliminates rascality in the society.”

    Again, Onejeme said Governor Obiano had vowed to sanitise the state, adding that they, as members of his cabinet had a duty to help him realise his dream of normal society.

    “Anambra State must be a place where discipline reigns. That is one of the cardinal points of the Obiano administration and we must get it right. The structures we are constructing in the market are for the benefit of the downtrodden and not for selfish interest,” he said.

    Meanwhile, the Board of Directors of the bank had approached the court in Awka to challenge the demolition of their structure by government without any form of consultation.

    It is between Awka Micro-finance Bank Limited as plaintiff against Ifeatu Onejeme (Commissioner), Mike Uzuagu (Director Markets, Ministry of Industry, Trade and Commerce), Government of Anambra State and Tony Nwobu (Contractor) as respondents.

    Chief Ozoemena B. Onyali (SAN), counsel to the petitioners, is claiming N200 million as general damages on behalf of his clients against government for unlawful invasion and trespass.

    They are seeking a declaration that the incursion onto the applicants’ leasehold land and premises situate at Eke-Awka Market by the government is an effort to forcibly eject the applicant and therefore a contravention of the applicants’ fundamental rights to own immovable property or interest in immovable property guaranteed by section 43 and 44 of the Constitution of the Federal Republic of Nigeria 1999 (as amended).

    “A perpetual injunction restraining the respondents from entering, remaining on, building on, doing anything on the applicants’ leasehold land and premises at Eke-Awka Market or alienating, letting or occupying same,” among other prayers.

    Already, the state government has started building on the land. But will the right owner of the land that has caused so much tension in the state emerge? Only time will tell.

  • Conoil declares N2.78billion dividend

    Conoil declares N2.78billion dividend

    FOR shareholders of Conoil Plc, the front line petroleum marketing business has been good. They made this submission recently as they commended the company’s declaration of N4.00 dividend, translating to N2.78 billion cash payment for its last financial year, despite the harsh operating environment witnessed by the downstream petroleum sector, during the period.

    The shareholders expressed their delight at the company’s 44th Annual General Meeting held in Uyo, Akwa Ibom State capital.

    “We are impressed with the record performance and the balance sheet. We are indeed happy that Conoil is paying quality dividend amid the tough challenges facing downstream operators in this country. It shows that the board and management of the company hold every shareholder in high esteem,” National Coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, said.

    “I am particularly pleased that the board kept to the promise made at the last meeting to boost bottom-line and ensure adequate returns on investment for shareholders. The revenue and profit growth compared favourably with industry performance. We can only wish that they continue to strengthen and consolidate on the company’s leadership position in the industry,” Executive President of Nigeria Shareholders Solidarity Association (NSSA), Chief Timothy Adesiyan said.

    Echoing similar sentiments, the Chairman, Ibadan Zone Shareholders’ Association, Chief Sola Abodunrin, commended the company for ensuring that the shareholders earned returns on their investments.

  • Afromedia assures shareholders of bright future

    THE Board and management of Afromedia Plc, Nigeria’s leading supplier of out-of-home media services, have assured shareholders that the company was on the way to full recovery and profitability. It promised a revolutionary business approach, which included a return to the Airport and other new innovative products to be unveiled shortly.

    This was the highpoint of the company’s 48th Annual General Meeting (AGM) in Lagos at the weekend where a net loss before tax of N851 million was announced for the 2013 financial year which ended September 30, last year, a remarkable improvement of 81 per cent against the deficit of N4.47 billion in the previous financial year.

    According to its Chairman, Mr. Idowu Iluyomade, the company recorded a turnover of N742.9 million in the financial year that ended on September 30, 2013, as against N1.64 billion turnover in the corresponding period the previous year, a decline of 54.8 per cent.

    He explained that the turbulence that hit the company in 2012 as a result of the protracted remodelling of federal airports nationwide contributed largely to the poor fortunes. The consequence was that the company experienced continuous adverse disruptions of its operation at all its major and exclusive airport advertising concession sites as a result of the infrastructural upgrade by the Federal Airport Authority of Nigeria (FAAN).

    In the words of Mr Iluyomade, “’the company was virtually incapacitated by this adverse regulatory development as no business could be executed in any of the Federal airports pan-Nigeria in year 2013. This resulted in loss of over 75 per cent of the company’s installed revenue generating capacity.

    ‘’Although the Board and Management of the company explored all available options towards resolution of the impediments in this strategic transit business segment, the year passed without achieving the much-desired restoration of the advertising sites. This significant lost revenue generating capacity accounted principally for the low turnover in the year under review.”

    In addition to that drawback, the  chairman said the prevailing insurgency and insecurity in some parts of the northern region of the local economy, truncated business plans for generating revenue with available billboards of the company in the affected region.

    Iluyomade explained that the major game changer was the full adoption of International Financial Reporting Standards (IFRS) in the 2013 financial year.

    According to him, the impact was the mandatory adjustments and write-offs of balances permitted in the previous local standards but disallowed under the IFRS, “thereby contributing to the negative bottom line position in 2013 in compliance with the IFRS accounting system”.

    IFRS account system mandatorily required to write-off and provide for all the accumulated pre-structural investments made by the company over the years under the business expansion initiatives, but which were suspended until it becomes economically and technically feasible to activate them.

    Assuring shareholders that the company would soon return to the years of profitability, the Managing Director, Mr. Akinola Irewunmi Olopade said that Afromedia had not only returned to the airports but have a five-year contract with FAAN. As a result of Afromedia’s return to the airports, that all pre-existing clients have indicated interest in having their adverts exposed at the airports, he announced to cheering shareholders.

    The shareholders empathised with their company and commended the Board for charting a clear way out of the current challenge.

    Mr Alex Adio, a patron of Dynamic Shareholders Association, said the shareholders knew the genesis of the situation and were confident that the new Board was on a new pedestal. “With the new directors coming on board, we believe that things will change for the better,” Adio said.

    The shareholders ratified appointment of new directors – Mr Idowu Iluyomade (Chairman), Mr Victor Ogiemwonyi, Mr Ernest Chukwudi Ebi and Mallam Ibrahim Isiyaku – all non-executive directors.

    The firm of Ernst & Young was also re-appointed as External Auditors while Mr. Meshach Masade and Mrs Elizabeth Gbegbaje were re-elected into the Audit Committee.

  • Shareholders’ positive take on Guinness playbook

    Shareholders’ positive take on Guinness playbook

    Share price of Nigeria’s second largest brewer traced an upward trajectory despite eroding bottom line to underscore investor confidence in the 64-year-old brewer revered for the signature brand Guinness Stout.

    On a day the local unit of London based Diageo announced missing profit expectations with net income falling to N9.57 billion ($48.3 million) in the nine months through March, compared with N11.86 billion a year earlier, its share price stayed rooted on N180 at 12:03 p.m. in Lagos trading. The stock made further gains the day after, opening at N180.50.

    Thus despite missing profit target for the year, investors are rallying behind the company conscious of the company’s ability to wring long term value for shareholders.

    A leading shareholder organisation’s leader says the reason are not farfetched as they are looking at the company’s trajectory in the long run while noting that the fourth quarter performance is better than previous quarters.

    He highlighted the Brewers consistency in dividend pay-out as a strong reason for their clinging on the stock despite the company halving payouts to N3.2 from N7.

    “Shareholders are pleased,” says Boniface Okezie who is President of the Progressive Shareholders Association.

    This is “because it (dividend payment) ranks GN among the companies with consistent dividend payout,” growth rate analysts put at 3.13 per cent in the last five years.

    “There is also renewed optimism amongst shareholders as they notice that the strongest showing of the company came in the last quarter of the year under review.” This Okezie attributes to ‘the company’s aggressive marketing strategies that have seen it introduce new brands and rev up advertisement spend in the bid to win more market share.

    “We must commend the efforts of the management of the company for turning around the financial fortunes of the company under very difficult economic conditions,” he said.

    The payout, analyst Exotix Frontier Equities, says “is positive for the business as it can reserve cash and reduce the need for additional debt financing”.

    Although the analyst projected that “the market will likely respond negatively due to the sensitivity of shareholders to the annual dividend”, the overwhelming shareholder optimism indicates the contrary.

     

    Technical Analysis

    With a beta of 0.5863 (according to the Financial Times),which indicates that the stock is less likely to swing with market vagaries; and a solid historical performance, the stock remains a darling of Portfolio managers and Brokers who cling to it in their managed portfolios.

    The stock has experienced significant pullback since last July when the stock had a Relative Stock Index (RSI) of over 70 (when the stock was overvalued) ebbing now (September 5) at 35.48 indicating that it is a candidate for a ‘hold’ recommendation. It is also a short hand way of saying ‘don’t sell!’

    After last year’s results were unfolded on the floor of the Nigerian Stock Exchange (NSE), an analyst was quoted as saying, “For those seeking to invest now, the stock represents a hedging opportunity in a market that has witnessed volatility amidst feeble fundamentals”.

    This prognosis remains relevant into the foreseeable future.

     

    Fundamentals

    In the year under review gross revenue took a few steps backward from N122.46 billion to N109.202 billion on the back of eroding consumer demand and value corroding inflation. The effect was a less than impressive showing in the consumer sector of the economy. The Brewing industry was badly hit in the inevitable descent down the plateau of sagging profits.

    Analyst say, the southward ride is “is systematic to the brewing industry this financial year as consumers suffer a contraction in disposable income.” Much of the contraction was also traceable to increased competition within the industry as new entrants gnawed at the available but inelastic pie.

    Despite the manufacturers of Malta Guinness effectively taming cost of sales Gross Profit slipped in the period. Cost of sales or the amount spent to sell the company’s products was controlled to N51.33 billion from N56 billion, a 12 percent improvement. This helped minimise the fall of Gross profit by only 8.7 percent to N51.33 billion from N56.08 billion.

    Operating costs proved a little too hot to handle in the period doing a disservice to operating profit which ebbed 23 per cent from N20.93 billion to N16.12 billion.

    Bottom line figures of pre-tax and net profits inevitable travelled in the wrong direction with the heavy weight of cascading operating returns and the haemorrhage occasioned by unwieldy financial costs though the costs remained near constant for 2014 as in 2013.

    Debts incurred in previous years conspired to erode profits as their effects emerged in servicing costs of roughly N4billion every year in interest cost (capitalized or not). This will have a deleterious effect on earnings per share.

    Pre-tax profits swooned 31 percent to N11.68 billion from N17 billion while net profit followed with a 59 percent slump from N11.86 billion to N9.57 billion.

    All trading margins besides the gross profit margins show a company managing efficiency.

    Gross profit margin at 47 per cent was two steps better than the 45 percent achieved earlier but operating profit margin, a strong indicator of effective cost management shrank to 14.7 percent from 17.1 percent.

    For gross returns, it means for every naira earned, gross profits make up 47 kobo compared to the earlier year when 45 kobo was made from every naira.

    The figures also suggests that for every naira in revenue, operating profit makes up 14.7 kobo compared to 17.1 kobo achieved in the previous year.

    Pre-tax margin was 10.7 percent which is lower than the previous year’s showing of 13.9 percent.

    Net profit margin didn’t veer too far from the previous year’s performance ending at 8.8 percent compared to 9.7 percent made in the 2013 financial year.

    Despite its challenges and not very savoury results of the company, analysts tip the Brewer for ratcheted profits in the near future provided it would take advantage of its formidable assets across the country and scale up marketing strategies.

     

    Management’s take

    Management of Guinness Nigeria plc is optimistic of the prospect of the company despite the performance in the last financial year.

    Much of the optimism is coming from the fact that analysts estimate the Nigerian beer market to be worth over $2.7 billion with projected average annual growth of 23.45 per cent between 2011 and this year.

    In a release on the floor of the Nigerian Bourse, Guinness management reiterated its confidence in the maker of the drink bearing the signature of Sir Arthur Guinness describing the business as ‘resilient’.

    “We are confident that our strategy which is focused on improving our route to consumer, maximising value creation from our core brands and innovation and finance cost reduction will improve both top and bottom line performance in the current financial year.

    “The Board is confident that we have the right brands, people and structure to win in Nigeria.”

    Managing Director/Chief Executive Officer Seni Adetu believes that winning the future boils down to “the various innovations we have launched in recent times especially Orijin Bitters and Orijin Ready to Drink (RTD) have been quite successful, and we expect to further dial up our play in the value segment with Satzenbrau and Dubic Lager.”

    He notes that the company’s nascent products including Orijin Bitters, Snapp, Satzenbrau, Dubic and Orijin RTD were still growing, heralding a big boost for Guinness Nigeria’s future performance.

    Chairman, Guinness Nigeria Plc, Babatunde Savage capsuled the company’s future on its people and capabilities.  “The Board of Guinness Nigeria is confident that we have the right people and capability to guarantee the delivery of our strategic priorities of driving out cost to invest in growth, turning the business around by strengthening and accelerating our premium core brands, innovating at scale to meet new consumer needs, and extension of our route-to-consumer advantage,” he said.

    How all of this play out would be the exciting drama that would animate the Brewery industry in 2015, especially with the competition posed by imported wine and spirits.

     

  • RT Briscoe gets shareholders’ nod to raise N10b

    RT Briscoe gets shareholders’ nod to raise N10b

    Shareholders of RT Briscoe (Nigeria) Plc yesterday authorised the board of the company to raise N10 billion to deleverage its operations as the automobile and real estate company struggled with losses induced by huge interest expenses.

    At the annual general meeting in Lagos, shareholders mandated the board to raise new funds through any option or a combination of debt instruments, preference shares and ordinary shares by way of rights issue, private placement or offer for subscription.

    To create room for the impending fresh capital, shareholders also increased the authorized share capital of the company from N2 billion divided into 4.0 billion ordinary shares of 50 kobo each to N3.25 billion divided 6.5 billion ordinary shares of 50 kobo each.

    Addressing the shareholders, chairman, RT Briscoe (Nigeria), Mr. Clement Olowokande said the directors on the company have been strategizing on how to optimize the use of available resources and opportunities for maximum returns.

    According to him, in order to raise the much needed capital for business expansion and working capital, the board is exploring the possibilities of recapitalizing through debt instruments, additional equity or a combination of both.

    He assured shareholders that the board will on behalf of the shareholders, carefully select auspice time and modality for implementing these options.

    He enjoined the shareholders to support the company in its efforts to recapitalize its business and stem the tide of losses in recent years.

    “The automobile industry in Nigeria, particularly for motor dealers and distributors like us, is currently in a development phase that requires significant capital outlay for stock, after sales infrastructure and implementation of development phase for the future,” Olowokande said.

    He said the competition in the market place has become more severe as all major brands in the world are now present in the country.

    On the future prospect of the company, the chairman the recent rebasing of Nigeria’s GDP confirmed enormous business opportunities in the country for a company like RT Briscoe.

    Olowokande observed that contrary to prior economic data before the rebasing, that the oil and gas sector represented 32 per cent of the economy, under the new set of data, that sector only contributed 14 per cent while much of the balance came from previously unreported, consumer-driven sectors.

    He also said that a report by the World Bank that the Nigerian had expanded by an average of six percent annually since 2006 and which according to IMF data is expected to achieve a rate of seven percent this year, gives much room for optimism and confidence in the business outlook, adding that this is further bolstered by reports that the population is growing by more than two percent per year, indicating a growing market for the company’s goods and services.

    The chairman also said the new automotive policy designed to favour local manufacturers and assembling of semi and completely knocked down parts is viewed by the board of the company as a challenge to improve the business horizon of the company.

    Owing to difficult operating environment in 2013, RT Briscoe recorded a group turnover of N21.8 billion during its financial year ended December 31, 2013 compared with a turnover of N21.9 billion during the corresponding period of 2012.

    “Irrespective of the progress made in property development projects, the International Financial Reporting Standards do not allow income to be realised until contractual arrangements are concluded and interest in the property is transferred to a third party,” Olowokande said.

    RT Briscoe recorded a loss before tax of about N152 million in 2013 as the company continued to wriggle in mounting interest expenses. Key extracts of the audited report and accounts of RT Briscoe for the year ended December 31, 2013 showed top-down decline in all key performance indices, underlining the decline in sales and continuing negative impact of the company’s financing expenses.

  • Shareholders approve N568b Lafarge Africa

    Shareholders approve N568b Lafarge Africa

    The consolidation of Lafarge’s cement businesses in Nigeria and South Africa into a Nigerian-listed building materials giant to be known as Lafarge Africa Plc crossed the Rubicon yesterday as shareholders of Lafarge Cement Wapco Nigeria Plc overwhelmingly approved the historic consolidation.

    The consolidation would be done by transferring Lafarge’s assets in South Africa and Nigeria to Lafarge Cement Wapco Nigeria, which would subsequently be renamed Lafarge Africa. Lafarge Africa, which would retain Lafarge Wapco’s subsisting listing on the Nigerian Stock Exchange (NSE), is estimated with initial market capitalisation of $3 billion, about N468 billion.

    At the annual general meeting yesterday in Lagos, shareholders also approved a new capital issue of N100 billion, which could raise the market value of the emergent Lafarge Africa to more than N568 billion. After the consolidation, Lafarge Africa will be the 6th most capitalised quoted company in Nigeria.

    Lafarge Wapco’s share price rose by 1.71 per cent with addition of N1.88 to close yesterday at the NSE at N112.07. This translated into market value of N336 billion, the 8th most capitalised company on the stock market.  Ashaka Cement, which is also part of the consolidation, also rose by 2.07 per cent with addition of 60 kobo to close at N29.60 per share. This implied a market capitalisation of N66 billion, the 29th position on the NSE.

    All the resolutions relating to the consolidation were passed by a significant majority of the eligible shareholders with approvals ranging between 78 per cent and 98 per cent, notwithstanding that Lafarge Group abstained from voting on the special resolutions.

    Under the transaction, Lafarge Group will transfer its direct and indirect shareholdings in Lafarge South Africa Holding Limited of 72.4 per cent and its equity stakes in three other cement companies in Nigeria-United Cement Company of Nigeria Limited, 35 per cent; Ashaka Cement Plc, 58.61 per cent and Atlas Cement Company Limited, 100 per cent; to Lafarge Wapco for a cash consideration of $200 million and the issuance of some 1.4 billion Lafarge Africa shares to the Lafarge Group.

    Shareholders who spoke at the meeting roundly commended Lafarge Wapco for its improving fundamentals and dividends. Shareholders’ leaders who spoke at the meeting included Chief Sola Abodunrin, chairman, Ibadan Zone Shareholders Association (IBZA); Sir Sunny Nwosu, national coordinator, Independent Shareholders Association of Nigeria (ISAN); Chief Timothy Adesiyan, president, Nigeria Shareholders Solidarity Association (NSSA); Mr. Nonah Awoh and Bishop Goodluck Akporie of Onitsha Zone Shareholders Association among others.

    They applauded the performance of the company noting that they expected the emergence of Lafarge Africa to lead to further improvements in the performance and returns of the company. They approved a dividend per share of N3.30 for the 2013 business year as against N1.20 paid for the previous year.

    Speaking at meeting, chairman, Lafarge Cement Wapco Nigeria, Chief Olusegun Osunkeye said the overwhelming supports from majority of the minority shareholders were strongly reflected the fact that they saw the strong value opportunity in the creation of Lafarge Africa.

    “I am extremely pleased with the outcome of today’s vote.  Lafarge Africa is not only a value enhancing transaction for shareholders but it will provide significant value to all stakeholders through the creation of a Nigerian listed Sub-Saharan Africa building materials giant that will be better able to support the development needs of our continent,” Osunkeye said.

    According to him, the newly created entity will have a combined production capacity of around 12 million metric tonnes comprising Lafarge Wapco’s 4.5 million metric tonnes, Lafarge South Africa Holdings’ 3.6 million metric tonnes, United Cement Company of Nigeria’s 2.5 million metric tonnes, Ashaka Cement’s 1.0 million metric tonnes and Atlas Cement Company – an import operation with bagging capacity of 0.5 million metric tonnes.

    He noted that there were already projects underway to expand on this capacity and by 2017; Lafarge Africa Plc will have installed cement capacity of 17 million metric tonnes while the inclusion of South Africa also provides operations in aggregates and fly ash.

    In his remarks, Guillaume Roux, who will be the managing director and chief executive of Lafarge Africa Plc, said the creation of Lafarge Africa would allow the company to continue in its drive to be the best in the areas in which it operates.

    According to him, the consolidation implies a broader geographic coverage which means that Lafarge Africa will be better positioned to serve its customers more widely.

    “It also places the company in a stronger position to be able to benefit from the economic growth and development opportunities available in both Nigeria and South Africa,” Roux said.

    With the approval yesterday, Lafarge Africa will move on to require regulatory approval from the Securities & Exchange Commission (SEC) to finalise the transaction. This is anticipated to take place during the third quarter of 2014. Once approved and in line with Nigerian regulation, a mandatory tender offer will be open to minority shareholders of Ashaka Cement to give them the opportunity to swap their shares for Lafarge Africa’s shares.

    Audited report and accounts of Lafarge Wapco for the year ended December 31, 2013 showed that profit after tax grew by 92 per cent to N28.2 billion in 2013 as against N14.7 billion recorded in 2012. Profit before tax grew by 30 per cent from N21.3 billion to N27.7 billion. Turnover increased by 12 per cent to N98.8 billion as against N87.9 billion in 2012. The company witnessed significant reduction in interest expenses N5.5 billion to N3.8 billion as a result of the reduction in interest charges due to the full repayment of the Naira syndicated bank loans. Consequently, basic earnings per share grew from N4.90 to N9.42; an increase of 92 per cent.

    Lafarge Wapco’s new ready-mix concrete business contributed N1.6 billion to the total turnover of N98.8 billion. The company not only focused on increasing its turnover but has ensured that its operational costs are curtailed without compromising on service to its customers. The strong operational performance and efficient working capital management resulted in an increase in cash holdings of N11.5 billion. With the company being in a more cash positive position, it was able to reduce its debt by 42 per cent, paying off its variable rate medium term syndicated Naira and foreign currency loans ahead of tenor. Accordingly, Lafarge Wapco’s debt position closed 2013 at N21.5 billion comprising a fixed rate corporate bond and a power intervention fund loan. The debt-to-equity ratio halved to 23 per cent in 2013 as against 55 per cent in 2012.

  • Shareholders seek probe of firms to be delisted

    Shareholders seek probe of firms to be delisted

    Shareholders have called for extensive probe of companies  earmarked for delisting by the Nigerian Stock Exchange (NSE), arguing that capital market regulators should unravel the management of the companies’ resources.

    Shareholders, who spoke to The Nation, said capital market regulators should probe the utilisation of the funds earlier raised by those companies and the previous projections made by the companies. Many shareholders were against the delisting of the companies, noting that delisting would worsen shareholders’ fate.

    The NSE recently said it has decided to delist 21 companies that have failed continuously to meet the corporate governance standards at the stock market. In a notice of delisting obtained by The Nation, the NSE said it decided on the delisting to protect investors from trading on securities with serious corporate governance failures.

    The affected companies included Investment and Allied Insurance Plc, Goldlink Insurance, Pinnacle Point Group, Adswitch, Afroil, Rokana Industry, IPWA, West African Glass Industry, Nigeria Wire and Cable, Starcomms, Daar Communication, Mtech, Big Treat, G.Cappa, FTN Cocoa Processing and UTC Nigeria.

    Others included Stockvis, Nigeria Sewing Machine, Jos International Breweries, Capital Oil and Golden Guinea. However, Adswitch had earlier filed for voluntary delisting while Pinnacle Point Group is in the process of being wound up.

    According to the Exchange, while the five of Stockvis, Nigeria Sewing Machine, Jos International Breweries, Capital Oil and Golden Guinea were being delisted because they failed to regularise their listing status, other companies were being delisted because they have failed to submit requisite financial and operational statements.

    Chairman, Ibadan Zone Shareholders Association (IBZA), Chief Sola Abodunrin, said the companies could discourage investors from future participation in new issues as most of them only came to the market to raise funds without returns to shareholders.

    According to him, the companies did not follow through with their purposes of the fund raising and mismanaged investors’ funds.

    Abodunrin, a member of the board of trustees of the Investors Protection Fund (IPF) of the NSE, said delisting would be worse for the investors in the companies as they won’t be able to retrieve their investments.

    He said the companies would not adhere to any iota of corporate governance after delisting and shareholders would not have any hope of holding the companies to account.

    National coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, also said the NSE and Securities and Exchange Commission (SEC) should go beyond the delisting to determine the extent of management’s culpability in the companies’ misfortunes.

    Another shareholders’ leader, Alhaji Gbadebo Olatokunbo, called for a thorough investigation of the management of the companies.

    According to him, the regulators should be able to extricate failures that were due to environmental constraints from those due to managerial failures.

    The NSE had stated that the delisting was necessary to protect investing public from trading in the securities of entities with no current information regarding their financial status.

    The NSE stated that the delisting of the companies would take effect in September, in line with three-month notice required for such action.

    All the companies slated for delisting had been dormant and mostly at their nominal values. Companies such as Big Treat, Starcomms, Capital Oil and Afroil have been subjects of regulatory investigations.

    Since listing on the NSE, Starcomms has struggled with mounting debts and operational losses, leaving shareholders with losses on two fronts as negative bottom-line impacts on share price.

  • Dangote Sugar pays N7.2b dividends to shareholders

    Dangote Sugar pays N7.2b dividends to shareholders

    Shareholders of Dangote Sugar Refinery (DSR) Plc at the weekend unanimously approved the distribution of N7.2 billion as cash dividends for the 2013 business year amidst commendations for the board and management of the sugar company.

    At the annual general meeting in Lagos, shareholders commended the performance of the company in 2013. The gross dividend translates into a dividend per share of 60 kobo.

    Chairman, Ibadan Zone Shareholders Association (IBZA), Chief Sola Abodunrin, said the performance of the company was commendable noting the improvements in sales and profit.

    Coordinator, Pragmatic Shareholders Association of Nigeria, Mrs Bisi Bakare, said the board of Dangote Sugar has shown commitment to shareholders’ interest with consistent dividend payment.

    The shareholders applauded various strategies put in place by the board and management that made the company to overcome the challenging operating environment and deliver improved bottom-line.

    Chairman, Dangote Sugar Refinery (DSR) Plc, Aliko Dangote, said the company’s 10-year growth plan would deliver better returns to shareholders and consolidate its position as the largest sugar company in West Africa.

    According to him, pursuant to the introduction of the federal Government’s National Sugar Master Plan in Nigeria, DSR has begun it own development plan which would lead to phenomenal growth in its capacity over the next five to 10 years.

    “This plan is targeted at the production by your company of 1.5 million to 2.0 million tonnes of sugar per annum from locally-grown sugar cane within the next five to 10 years. This will further consolidate our position as the largest sugar producer in West African region,” Dangote said.

    H e noted that the company has taken great care in the preparation of this sugar development plan with the operations being structures to include an increased focused on the company’s backward integration project.

    He said the company has a robust growth agenda driven by the backward integration development plans.

    “As we commence this journey our priority remains to consolidate our clear leadership of the sugar industry in Nigeria. We will work to ensure ongoing operational efficiency to drive continued growth across our markets,” Dangote said.

    Group managing director, Dangote Sugar Refinery (DSR) Plc, Mr. Graham Clark said the sustainability model of the company is targeted at empowering local communities and will be implemented across all project sites, starting with Savannah Sugar Company Limited.

    “Our targets are clear and a robust framework supported by key performance deliverables will enable us to deliver the expected results in the next five to 10 years with enhanced benefits to all our stakeholders,” Clark said.

    He outlined that the company has restructured its sugar operations with greater focus on backward integration project with the targeted selection and acquisition of some 200,000 hectares of land across various states in Nigeria for the development of sugar cane plantations and construction of modern sugar processing factories has begun.

    Audited report and accounts of the company for the year ended December 31, 2013 showed that turnover rose to N102.467 billion in 2013 as against N106.868 billion in 2012. However, profit before tax rose from N16.331 billion in 2012 to N20.099 billion in 2013. Profit after tax grew from N10.796 billion to N13.537 billion.

     

  • Consolidated Breweries rewards shareholders with N918m dividend

    Shareholders of Consolidated Breweries Plc yesterday at the company’s annual general meeting unanimously approved a gross dividend of N917.7 million as cash payouts for the 2013 business year. The breakdown indicates shareholders will receive a dividend per share of N1.85.

    Shareholders at the meeting also threw their weight behind the ongoing plan to merge the company with the Nigerian Breweries Plc, noting that this would result in a bigger and better company. They however demanded for fair valuation of their shares in the merger process.

    Speaking at the general meeting, chairman, Consolidated Breweries Plc, Prof. Oyin Odutola-Olurin, assured shareholders that the board is committed to protection of shareholders’ interests, assuring that shareholders will receive adequate value in the merger.

    It will be recalled that managements of Consolidated Breweries and Nigerian Breweries had in a statement on Monday announced plan to merge both entities for better performance.

    Odutola-Olurin said the immediate past year was a truly eventful year as the company achieved several milestones in its journey towards greatness.

    According to her, major achievements included the expansion of the company’s production capacity, the successful merger of Benue Breweries Limited and DIL/Maltex (Nigeria) Plc, the introduction of a new system which improved the controls in business, as well as the introduction of a new bottle for “33” and a variant of Malt drink, the Hi-Malt Choco Twist.

    She also hinted of the plan to use gas to power some of the equipment at the Ijebu Ode Brewery, in an effort to drive down costs.

    Managing director, Consolidate Breweries Plc, Mr Boudewijn Haarsma noted that the company has been integrated into Heineken’s long-term sustainability strategy.

    “We aim to create genuine shared value for all our stakeholders as sustainability is part of how we manage our business”, Haarsma said.

  • Shareholders laud insurance firm N4.3b profit, dividend

    Shareholders of Custodian and Allied Insurance Plc have lauded the board and management of the company for growing the group’s profit before tax to N4.33 billion. They also praised the firm for announcing a dividend of 16 kobo dividend per sharein 2013 financial period.

    National Coordinator of the Independent Shareholders Association of Nigeria, Mr. Sonny Nwosu, who spoke at the 19thAnnual General Meeting (AGM) of the firm in Lagos, cautioned the firm to ensure its management expenses does not rise beyond limits.

    He also criticised the ‘No premium, no cover’ policy of the National Insurance Commission (NAICOM), noting it is a problem for firms and that it may affect the growth of their businesses.

    He advised the firm to continue to educate the Nigerian public on the need to be insured.

    Chairman, Custodian and Allied Plc, Chief Ade Ojo, affirmed that the company would pay 16 kobo dividend to its shareholders.

    He said this demonstrates the firm’s regular dividend payment to its shareholders.

    Ojo said this was the first consolidated result of the post-merger Custodian group with a top and bottom line growth.

    According to him, the growth was fuelled by 28 per cent increase in gross premium income and 38 per cent rise in fees and commission income while the anticipated cost savings that were envisaged in the merger manifested in noticeable reduction in underwriting expenses which went down by 15 per cent and management expenses which went down by eight per cent in spite of the generous redundancy benefits paid to the disengaged employees.

    He said the group’s profit before tax was N4.33 billion while the earnings per share and net asset per share increased to 60 kobo and 325kobo respectively.

    Total asset, he said, stood at N45.65bn while shareholders’ funds were N19.1 billion.

    He said that the successful integration of the Crusader operations and the resulting strong entity with enviable result had demonstrated that Custodian is ready for the future.

    He said: “Our strong balance sheet and financial capacity, expanded and diversified product portfolio, operational efficiency and highly professional team will ensure that the company maintains its leadership position and provides superior return on investment to our loyal shareholders.

    “The company’s name was changed to Custodian and Allied Insurance Plc, when it was sanctioned by the court after it completed a successful acquisition.”

    The company is an investment holding company with investment in life and non-life insurance subsidiaries, Pension Fund Administrator and a trust company and is also been classified under the other financial services subsector of the financial services sector of the Nigerian Stock Exchange official list.

    He said that Custodian shares had since been issued to the erstwhile shareholders of Crusader (Nigeria) Plc and had grown from a company with 23,812 shareholders as at December 2012 to 41,003 as at December 2013.