The Nation Newspaper

Tag: Shareholders

  • Union Bank’s shareholders approve N50b rights issue

    Union Bank’s shareholders approve N50b rights issue

    Union Bank of Nigeria (UBN) Plc plans to raise N50 billion new equity funds from existing shareholders of the bank.

    At an extraordinary general meeting yesterday in Lagos, shareholders of the first generation bank approved five resolutions authorising the board of the bank to raise up to N50 billion through rights issue.

    Shareholders increased the authorised capital of the bank from N9.5 billion consisting of 19 billion ordinary shares of 50 kobo each to N17.5 billion consisting of 35 billion ordinary shares of 50 kobo each by the creation of additional 16 billion ordinary shares of 50 kobo each.

    With this, the memorandum and articles of association of the bank will be amended to reflect the increase in the authorised share capital to N17.5 billion.

    Amendment of the bank’s articles and memorandum of association in order to authorise an increase in the bank’s share capital and the mandate to issue new shares require approval of at least a three-quarter majority of votes present at the meeting. The resolutions yesterday were supported by shareholders representing altogether 99.6 per cent of the votes.

    Chief executive officer, Union Bank of Nigeria (UBN) Plc, Mr. Emeka Emuwa, noted that obtaining shareholders’ approval for the bank’s capital increase is a necessary step towards the rights issue.

    He said the increase in capital will further strengthen Union Bank’s near-term positioning and enable it to realise its long-term growth aspirations.

    “We view the right issue approval as a strong sign of shareholders’ support for Union Bank’s  growth strategy and our plans to scale up operations and strengthen our position in readiness for uptake when the macroeconomic direction changes,” Emuwa said.

    Key extracts of the interim report and account for the Union Bank Group for the nine-month period ended September 30, 2016 showed that group gross earnings rose by 12 per cent to N93.43 billion in third quarter 2015 as against N83.72 billion recorded in comparable period of 2015. Interest income had grown from N66.91 billion to N70.96 billion. Net interest income improved by 19 per cent from N40.27 billion to N48.07 billion. Non-interest income also grew by 35 per cent from N16.67 billion to N22.47 billion.

    Group profit before tax rose by 27 per cent to N13.3 billion in third quarter 2015 compared with N9.6 billion in third quarter 2015. After taxes, net profit also rose from N9.34 billion to N13.01 billion. With these, earnings per share improved from 55 kobo in 2015 to 76 kobo in 2016.

    Key underlying ratios were generally positive. Net interest margin, which underlines the profitability of the core banking operations, improved from 8.1 per cent to 8.8 per cent. Cost-to-income ratio also improved to 63 per cent as against 76 per cent in comparable period of 2015. Return on equity increased to 6.9 per cent as against 5.5 per cent while return on assets improved from 1.2 per cent to 1.6 per cent.

  • Shareholders fault FRCN’s governance code

    Shareholders have described the National Code of Corporate Governance for the Private Sector issued by the Financial Reporting Council of Nigeria (FRCN) as unnecessary and duplicitous, warning that the code could be counterproductive to national economic development.

    Shareholders under the aegis of Independent Shareholders Association of Nigeria (ISAN) stated that the code bordered on over-regulation of the nation’s corporate world, particularly the financial industry. Shareholders also noted that the code also suffers from noticeable contradictions and conflict with the subsisting Companies and Allied Matters Act (CAMA).

    According to the shareholders, the FRCN’s code could suffocate entrepreneurial aspirations and initiatives of Nigerians and persons seeking to establish business in the country. Citing the provision of the code that companies shall have not less than five directors, the shareholders said such provision was unnecessarily expansionary and costly for micro small and medium scale enterprises (MSMEs), which are the engines of the nation’s economy.

    Already, the Securities and Exchange Commission (SEC) has a subsisting code of corporate governance that applies to all public limited liability companies. The Central Bank of Nigeria (CBN) and other financial regulators also have sectoral codes and rules that guide operations and corporate governance in their sectors.

    “There are also identified provisions of the code which directly conflict with existing laws governing certain sectors, which FRCN has included in the code all in a bid to elevate itself to another super-regulator over and above existing sectoral regulators for some companies,” ISAN stated.

    While identifying possible contradictions in the FRCN code, the shareholders’ group charged FRCN to lead by example by constituting its board in line with its new corporate governance code in order to justify the enforcement and sanction regime in the new code.

    ISAN listed grew areas in the code to include provisions that allow executive directors of the companies to be appointed board members of another company or companies, the time frame provided or “cool off period” before former executive director can be appointed chairman of the same company he served, engagement of two auditing firms and board size.

    The shareholders pointed out that the appointment of substantive executive directors into boards of other companies as contained in the FRCN code breached the whole essence of internationally accepted corporate governance and best practices.

    The Sunny Nwosu-led group noted that the prescribed 10 years “cool-off period” before former chief executive can assume the position of chairman in the same company amounts to serious setback in utilisation of limited experts, managerial proficiencies and scarce human capital resources.

    The minority retail shareholders said a major lacuna and breach of the law has been triggered with the provision of article 5.4 of the new code on the size of the board, noting that while FRCN’s code provides a minimum of eight board members for companies, the Companies and Allied Matters Act (CAMA) provides for minimum of two directors.

  • Shareholders praise Conoil over N2.1b dividend

    Shareholders praise Conoil over N2.1b dividend

    It was a unanimous vote and general commendation at the weekend as shareholders of Conoil Plc approved the payment of N2 billion as cash dividends for the immediate past business year.

    At the annual general meeting in Uyo, Akwa Ibom State, shareholders lauded the board and management of the downstream oil major for the 200 per cent increase in dividend payout, noting that the strong financial performance of the company and the increased dividend payout were major motivations for shareholders in this period of economic recession and stock market meltdown.

    With the approval of the gross dividend of N2 billion, shareholders will receive a dividend per share of N3 for the 2015 business year, 200 per cent increase on N1 paid for the 2014 business year.

    Key extracts of the audited report and accounts for the year ended December 31, 2015 showed that profit after tax rose by 176.5 per cent from N834 million in 2014 to N2.3 billion in 2015. Profit before tax jumped by 125.1 per cent from N1.5 billion in 2014 to N3.4 billion in 2015. Earnings per share also rose sharply by 177 per cent to N3.33 in 2015 as against N1.20 in 2014. Shareholders’ funds increased from N16.1 billion in 2014 to N17.71 billion in 2015. Net assets per share closed 2015 at N25.52 compared with N23.19 in 2014.

    National coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, said the dividend increase reinforced the confidence of shareholders in the commitment of the board and management to shareholders’ value.

    According to him, the performance of the company in spite of economic recession shows resilience and the quality of the company’s management and its entire workforce.

    President, Renaissance Shareholders’ Association, Mr. Olufemi Timothy said the company’s performance in the past 21 months was a pleasant surprise citing the tough operating environment characterised by tight liquidity and rising cost of funds.

    “It is very heartening that Conoil has not only braced the odds, it has remained committed to maximising shareholders’ value and delivering superior returns,” Timothy said.

    Another shareholder, Mrs. Bisi Adedigba of Lagos Zone Shareholders Association, applauded what she described as a resounding performance, urging other companies to emulate the example set by Conoil.

    She added that the company’s efficient management of resources has made it a toast of investors, making indirect reference to the 80 per cent share price appreciation that greeted the announcement of the 2015 results.

    “We commend this impressive performance. It, indeed, calls for celebrations particularly at this austere times and I would recommend other companies to take a cue from Conoil’s laudable example,” Bakare said.

    In his address to shareholders, chairman, Conoil Plc, Dr. Mike Adenuga Jr. reassured shareholders that the company would continue to implement initiatives aimed at growing shareholders’ value in spite of the tough operating environment.

    According to him, Conoil is positioned to further consolidate on the gains recorded so far and ensure better returns to shareholders in the years ahead.

    “Our encouraging performance in the midst of adversities has further confirmed our determination to deliver strong results at all times to the satisfaction of our shareholders and other stakeholders,” Adenuga said.

    He said the company is focused on being one of the industry’s fastest growing companies and it will work harder to maintain and improve the growth momentum.

     

  • Shareholders vow to resist SEC’s treasury for unclaimed dividends

    Major retail shareholders’ groups yesterday rose against the plan by the Securities and Exchange Commission (SEC) to establish a Nigerian Capital Market Development Fund (NCMDF) to take custody of unclaimed dividends of 12 years and above.

    SEC in a circular sent to capital market stakeholders on Tuesday, had called for a consideration of a new rule that will set up the NCMDF which will take custody of all unclaimed dividends of 12 years and above.

    Under the extant laws, unclaimed dividends will remain available for collection by beneficiaries up till 12 years when they become statute-barred and subsequently return to the companies that paid the dividends.

    Shareholders’ leaders across the groups said they would resist the transfer of statute-barred unclaimed dividends to any NCMDF, describing the plan as a wrong move and a volte face from the recent campaign by SEC for the removal of the 12-year limit to enable shareholders and their beneficiaries be able to collect their dividends at any time.

    National coordinator, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, said his group would mobilise shareholders to resist what he described as “very offensive” attempt to take their private monies.

    “I think it’s wrong, we will not agree and we will not allow that to happen,” Nwosu told The Nation.

    He said SEC and other regulators have sufficient funds and avenues to mobilise resources to perform their statutory roles of market development, noting that dividends belong to shareholders and the paying companies.

    Shareholders’ activist and one of the co-founders of Nigeria Shareholders Solidarity Association (NSSA), Alhaji Gbadebo Olatokunbo, said the plan would lead to corruption and discourage investors from the domestic market.

    According to him, SEC and other stakeholders should focus more on solving issues surrounding unclaimed dividend rather than looking for ways to start once again on how to acquire what does not belong to them under the guise of regulations.

    “Unclaimed dividends belong to shareholders who are the owners of companies and its going back to the companies after 12 years is legitimate. We respectfully call on the Federal Government to urgently call the regulatory agencies to order, before they add more damage to our already sick economy,” Olatokunbo said.

    President, Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr. Faruk Umar, however described the plan by SEC as a healthy development noting that the trust fund would discourage sharp practices around the unclaimed dividends.

    “The truth of the matter is that bulk of the unclaimed dividend that is more than 12 years belongs to people who are dead, multiple applicants who do not have bank account in their names, or small amounts of money that is not worth claiming. Someone that has not claimed his or her dividend in 12 years is unlikely to do so now. So, the Trust Fund should be established as this will discourage people from benefitting from the unclaimed dividend,” Umar said.

    According to him, with the anti-corruption stance of President Muhammadu Buhari’s government, and with the kind of integrity and transparency being exhibited by the current Director General of SEC, Mr Mounir Gwarzo, retails shareholders would support the establishment of the Fund this time around.

    In his remarks, coordinator, Constance Shareholders Association of Nigeria, Mallam Shehu Mikhail, said the existing rule on return of statute –barred dividends to companies should be retained.

    He criticized the plan by SEC for lack of details on benefits of such initiative to shareholders and the quoted companies.

  • CAP reassures as shareholders approve N1.64b dividend

    The board and management of CAP Plc have assured that the company would continue to explore opportunities to grow its business and deliver competitive returns to shareholders in spite of the macroeconomic challenges.

    At the annual general meeting at Golden Tulip Festac, yesterday in Lagos, shareholders of the leading paint company approved a final dividend of N840 million, representing a dividend per share of N1.20. CAP had earlier paid an interim dividend per share of N1.15 on December 15, 2015, bringing total dividend for 2015 business year to N1.645 billion or N2.35 per share.

    Notwithstanding the contraction in purchasing power and the constraints in the macro economy, CAP, a subsidiary of UAC of Nigeria Plc, showed steadied performance with turnover rising by one per cent to N7.06 billion while profit before tax inched up by five per cent to N2.57 billion.

    Addressing the shareholders, chairman, CAP Plc, Mr Larry Ettah, said the board and management have worked out mitigating strategies to curtail the adverse impact of macroeconomic challenges on the performance of the company.

    He noted that while the largely expansionary fiscal policy of the government will seek to stimulate economic activities and generate employment and thus impact on companies such as CAP, the acute shortage of foreign exchange that started this year could adversely affect corporate performance.

    According to him, the cumulative effect of the scarcity of foreign exchange, falling oil prices, and the resurgence of restiveness in the Niger Delta, which could endanger the production output of 2.2 million barrels per day and the continued depletion of foreign reserves pose serious threats to businesses and social activities in 2016.

    “The board and management of your company are alive to these challenges and have outlined mitigating strategies to ensure that these headwinds do not significantly impact our business negatively in 2016,” Ettah assured.

    He pointed out that in order to further improve the company’s brand visibility and accessibility to consumers; it opened additional Dulux Colour Centres in Yola and Gombe and Dulux Colour Shops in Lafia, Ada-George Port Harcourt, Ado-Ekiti, Dugbe Ibadan, Agbor, Suleja, Lugbe Abuja and Jalingo in 2015.

    He added that the company has also retained its ISO 9001:2008 and 14001:2004 certifications on quality and environmental standards respectively, which underlined continuing offering of high quality products and services to customers and compliance with regulatory requirements and conduct in its operations.

  • Berger Paints assures shareholders as new factory berths

    Berger Paints assures shareholders as new factory berths

    The board and management of Berger Paints Nigeria Plc have assured shareholders that the company would continue to grow the business value and improve returns on their investments as the paints manufacturing company sets to launch a new top-of-the-range manufacturing plant.

    At the annual general meeting yesterday in Lagos, chairman, Berger Paints Nigeria Plc, Dr. Oladimeji Alo, told shareholders that the impending launch of the company’s automated plant, the first of its kind in Sub-Saharan Africa, is expected to enhance the global competitiveness of the company’s products and increase significantly operational efficiencies.

    He said the new factory, which could be commissioned this year, would bring about tremendous improvement in the company’s operations adding that talks are ongoing with the appropriate authorities to secure tax break as pioneer status.

    Alo outlined that as part of the strategy to sustain the company’s competitive edge, special attention would be placed on increasing earnings and profitability, optimization of existing assets and business operations, investment in the leading brands, entering new categories with emphasis on Nano castings, and driving efficient financial management among others.

    He pointed out that in spite of the challenging operating environment, the company continued to sustain its performance, with emphasis on profitability and value creation for shareholders as profit before tax grew from N249.3 million in 2014 to N565.2 million in 2015, representing a 126.7 per cent increase.

    He said the company earmarked N217.37 million as dividends for the 2015 business year in demonstration of the confidence it has in the future sustainability and to reward shareholders for their investments.

    He assured shareholders that their request for bonus shares would be considered at the appropriate time while the company would more of its products as part of the new measures to improve community social relations (CSR).

    In his remarks, managing director, Berger Paints Nigeria Plc, Mr Peter Folikwe, said that one of the strategic plans to boost earnings was to reduce cost through operational efficiency.

    He added that consumer education would be accorded high priority to strengthen the relationship between the company and its customers.

  • GSK seeks shareholders approval to sell Lucozade, Ribena

    GSK seeks shareholders approval to sell Lucozade, Ribena

    The board of directors of GlaxoSmithKline Consumer Nigeria (GSK Nigeria) Plc has called an extraordinary general meeting of shareholders to seek approval for the disposal of the company’s drinks business to the Japanese group, Suntory Beverage and Food Limited (SBF).

    SBF, a leading soft drinks company with total sales of £6.6 billion, is seeking to buy over GSK Nigeria’s drinks business, which included the two iconic brands-Lucozade and Ribena, through its Nigerian subsidiary Suntory Beverage & Food Nigeria Limited.

    The general meeting, slated for July 4, was sequel to receipt of a binding offer from Suntory Beverage & Food Nigeria Limited by the board of GSK Nigeria.

    According to a regulatory filing submitted yesterday at the Nigerian Stock Exchange (NSE), shareholders would be requested to approve the proposed sale of the company’s business of  manufacturing, bottling, marketing, distributing and selling of the Ribena and Lucozade brands in Nigeria and all assets attached to or deployed in connection with the business to Suntory Beverage & Food Nigeria Limited.

  • Shareholders canvass merger of Nigerian Breweries, Champion Breweries

    Shareholders of Champion Breweries Plc have urged Heineken, the majority core investor in the Akwa Ibom State-based breweries, to merge the company with Nigerian Breweries. This they say, is to create synergies that could deliver greater values to them.

    Heineken holds the majority equity stakes in both the Nigerian Breweries and Champion Breweries, which are both quoted on the Nigerian Stock Exchange (NSE). Heineken, through its wholly-owned subsidiary, Raysun Nigeria Limited, holds 60.7 per cent majority equity stake in Champion Breweries.  Akwa Ibom State holds 10 per cent equity stake while other Nigerian shareholders hold 29.3 per cent equity stake.

    At the annual general meeting of Champion Breweries Plc in Lagos, shareholders said the ongoing consolidation in the breweries sector has placed a multiple-entities strategy at a disadvantage, as major investors such as SABMiller and Diageo consolidate their operations in Nigeria to create a critical mass that can drive turnover in the increasingly competitive market.

    President, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, said Heineken should without delay set in motion the process to merge Champion Breweries with Nigerian Breweries in order to optimise the potential of the Akwa Ibom State-based company and bring benefits to minority retail shareholders.

    According to him, while Heineken derives indirect benefits through its management and inter-member contracts within the group, minority shareholders have not been able to benefit from the turnaround because the company lacks the scale to compete profitably.

    Champion Breweries’ principal activities now consist of contract brewing services to Nigerian Breweries as well as brewing and packaging of Champion Lager Beer and non-alcoholic Champ Malta.

    Okezie noted that with the envisaged increased competition in the industry, Champion Breweries lacks the network and scale to stand alone, adding that the company will do better with combination of its business with Nigerian Breweries.

    Another shareholder, Mr Anthony Omojola, a leading member of the Independent Shareholders Association of Nigeria (ISAN), said the merger of Champion Breweries with Nigerian Breweries is the best likely thing to happen as it will be in line with global best practice when it comes to unlocking synergies.

    He said the majority core investor in the two breweries should make the process of business combination smooth.

    Another shareholder, Mr. Michael Cole, described Champion Breweries as a baby in the increasingly competitive breweries industry, noting that it lacks the market penetration needed to profitably compete in the industry.

    He urged the directors of the company to consider all options and go the extra mile to create better values for shareholders.

    Responding to shareholders’ remarks, Chairman, Champion Breweries, Dr Elijah Akpan, said the company foresees stronger competition with ongoing mergers between brewing giants in the world, which lead to more innovations and inflow of new brands in the market.

    He, however, noted that the outlook for the Nigerian breweries sector remains bright because of the country’s large and varied opportunities.

    “We shall explore the available possibilities the Nigerian business environment is offering to increase our market share within our business region. Considering our present financial position from deficit to surplus, our company has the right mindset and structures to achieve payment of dividend to you our esteemed shareholders in no distant future. We remain resolute in continuously achieving cost optimisation and innovation for increased profit,” Akpan said.

    Audited report and accounts of Champion Breweries for the year ended December 31, 2015 showed that turnover rose from N3.30 billion in 2014 to N3.50 billion in 2015. Operating profit jumped from N25.5 million to N206.77 million. Profit before tax stood at N210.18 million in 2015 as against loss of N1.07 billion in 2014. Profit after tax closed 2015 at N77.14 million compared with net loss of N754.52 million in 2014.

    Akpan assured that the board and management are working on a long-term vision that will ensure that the company becomes profitable, paying dividends to shareholders.

     

     

  • Fidelity Bank sets priorities as shareholders get N4.6b dividends

    Fidelity Bank sets priorities as shareholders get N4.6b dividends

    Fidelity Bank Plc plans to focus on redesigning its systems and processes to enhance service delivery and deepen cost optimisation to ensure competitive returns to shareholders.

    Acting Managing Director, Fidelity Bank Plc, Mr. Mohammed Balarabe, outlined the bank strategic focus in the 2016 business year at the annual general meeting in Lagos as shareholders approved distribution of N4.6 billion as cash dividends for the 2015 business year. Shareholders will receive a dividend per share of 16 kobo.

    He outlined that the bank would pursue initiatives aimed at reducing operating expenses and cost-to-serve while enhancing it over all risk monitoring capacities to ensure both internal and external risks are identified and mitigated before they crystalise.

    “On the back of the evolving dynamics in the industry, we will continue to increase the adoption and migration of customers to our digital platforms and increase our retail banking market share through innovative products and services,” Balarabe said.

    He said the bank’s 2015 performance reflected the disciplined execution of the management’s medium term strategy and the resilience of evolving business models despite the extremely challenging business environment in 2015.

    Key extracts of the audited report and accounts for the year ended December 31, 2015, showed that gross earnings grew to N146.9 billion in 2015 from N136.1 billion recorded in 2014. Profit after tax rose marginally to N13.9 billion in 2015 as against N13.8 billion in 2014.

    He pointed out that the 2015 financial year was challenging due to the difficult operating environment, the tight monetary stance of the Central Bank of Nigeria (CBN), implementation of the Treasury Single Account (TSA) and currency devaluation concerns, which culminated in negative earnings headwinds in the banking industry.

    According to him, even with the prevalent economic conditions, the performance of the bank showed resilience as it was able to achieve sustained growth through income stream built on qualitative services, innovative products and clear understanding of the varying needs of customers.

    He said the bank would continue to focus on balance sheet optimisation, rebalancing of its loan portfolio in consonance with its medium term strategy and increased growth in retail deposit base.

    In his address, chairman, Fidelity Bank Plc, Chief Christopher Ezeh explained that the tough business environment reflected more on the fees and commission income of the bank which dropped by 20.8 per cent to N23.3 billion from N29.4 billion due to regulatory restrictions on foreign exchange transactions.

    “Despite the drop in fees and commission income, profit after tax grew by 0.8 per cent, which shows the resilience of the earnings base of the bank. Net interest income increased by 24.7 per cent to N60.9 billion on account of loan re-pricing and balance sheet optimisation towards higher yield sectors of the economy,” Ezeh said.

    He pointed out that the bank improved the earnings capacity of its balance sheet even in the face of decline in fee income precipitated by a N10 billion reduction in its foreign exchange income.

    “We continued to increase yields on earning assets faster than the growth in funding costs, which improved our net interest margin to 6.9 per cent in 2015,” Ezeh said.

  • Shareholders approve Transcorp’s 1.94b bonus shares

    Shareholders approve Transcorp’s 1.94b bonus shares

    Shareholders of Transnational Corporation of Nigeria (Transcorp) Plc at approved the distribution of a total of 1.936 billion ordinary shares as bonus shares for the 2015 business years.

    At the annual general meeting in Calabar, Cross River State, they commended the conglomerate for what they described as resilient performance in 2015 in spite of the difficult operating environment. The bonus shares were distributed on the basis of one bonus share for every 20 ordinary shares of 50 kobo each held by each shareholder.

    Key extracts of the audited report and accounts showed that turnover stood at N40.75 billion in 2015 as against N41.34 billion in 2014. Gross profit dropped from N27.63 billion to N24.33 billion. Profit before tax declined from N7.73 billion to N3.32 billion while profit after tax slumped to N1.44 billion in 2015 as against N3.30 billion in 2014.

    Chairman, Transnational Corporation of Nigeria (Transcorp) Plc, Mr. Tony Elumelu, said the company remained steadfast in her efforts to consolidate on the significant achievements recorded to date and will continue to explore opportunities that will lead to the creation of significant value for all stakeholders in the coming years.

    In his remarks, president, Transnational Corporation of Nigeria (Transcorp) Plc, Mr. Emmanuel Nnorom, said the company made good progress on delivering on its strategy in 2015 as the group continued to improve operational and cost effectiveness as well as explore opportunities to expand its product offering.

    “The group continues to benefit from our ongoing investment in all our subsidiaries and new business lines, which enhance Transcorp Plc’s offering and position us for further growth. Our long-term value creation for our shareholders is our target which will come from the diversification plans, which includes the construction of new hotels in Lagos and Port Harcourt, ongoing installation of new turbines at Transcorp Power Plant, all which will result to an increased capacity after completion. The future of our company is very bright, considering the strategic path being undertaken by the board,” Nnorom said.