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May & Baker to pay N49m dividend

By on May 30, 2015

May & Baker Nigeria Plc on Thursday received the approval of its shareholders to pay N49m dividend for the financial year ended December 31, 2014.

The company got the approval of the shareholders to pay the dividend, which translates into five kobo per share, at its 64th Annual General Meeting in Lagos.

The Chairman, May & Baker Nigeria, Lt. Gen Theophilus Danjuma (retd), told the shareholders that the company had bounced back to profitability in 2014, overcoming a harsh operating environment to record a 990 per cent growth in profit.

He said the company moved from a pre-tax loss positon of N11.4m in 2013 to record a pre-tax profit of N101.1m. Similarly, the company recorded a profit after tax of N63m, 161 per cent higher than the loss after tax of N103m it posted in 2013.

“Cost containment and efficient resource utilisation were responsible for the positive signals by way of slight reduction in financing charges, distribution, sales and marketing expenses all of which contributed towards the profit delivered,” he said.

Danjuma explained that it was the improvement in performance that led the company to pay dividend after failing to do so for two years.

The shareholders of the company had last year authorised the Board of Directors to raise additional equity capital of N3.2bn for the company through any or a combination of rights issue, private placements and offer for subscription.

The May & Baker chairman, however, told the shareholders that the company had not been able to do so “on account of due considerations for timing, low market appetite, and readiness of members to take their rights.”

He, however, expressed the hope that additional capital would be raised to reduce the cost of finance.

He said, “It is my utmost hope that we will be able to bring in equity within the nest one year as it is evident that recapitalising the company has become imperative.

“Our finance cost has remained above N600m for the second year running. These would have flowed into profits for shareholders had we operated more on own equity than borrowed funds.

Danjuma, who said he was delighted that the company’s new pharmaceutical manufacturing plant in Ota, Ogun State had attained the World Health Organisation Good Manufacturing Practice status, stressed that the next target was to have a pharmaceutical finished product pre-qualified by the WHO.

He also said he was optimistic that once the company was recapitalised, it would be in a stronger position to fully leverage its installed capacity and aggressively promote its brands, ultimately delivering better profits.

Shareholders at the event commended the management for the turnaround of its fortunes. They also acknowledged the need for equity capital, but called for improved visibility for the products and better dividends in the future.

 

[Punch]