News Column

The 2013 Company Results and Shareholder Concerns

July 9, 2014

Akintola Omigbodun

Several companies have, in the last few months, had their Annual General Meetings, AGMs. Shareholders of each company have considered the annual report and accounts of their company for the year 2013 and have also declared at the AGM a dividend to be paid to shareholders from the profits of the company. We still expect results from some companies whose financial year does not end on 31st December.

Such companies include Guinness Nigeria Plc, PZ Cussons Nigeria Plc and University Press Plc. However, PZ Cussons Nigeria Plc has during 2014 paid an interim dividend of 19.91 kobo per share as well as a special dividend of N1.30 per share. We still expect a final dividend from PZ Cussons Nigeria Plc.

From the results submitted to the Nigerian Stock Exchange, NSE, during 2014, ABC Transport and Julius Berger Nigeria have each proposed a bonus share issue of 1 new share for every 10 existing shares.

Following on its AGM, Nigerian Breweries Plc, NBPlc, has announced proposals for a merger with Consolidated Breweries and its share price on the NSE has risen from about N150 per share to about N178 per share at the close of business on Friday 6 June 2014. Forte Oil Plc was one of the first companies to hold its AGM this year.

The company has experienced resurgence in its share price which also closed at about N250 per share on Friday, 6 June 2014. This is the same price as at the share offer in 2008.

Following on its AGM, FBN Holdings Plc, FBNH, has paid a dividend of N1.10 per share which is 10kobo less than would be expected if the company had kept to an apparent policy of increasing dividend by 20k per share from one year to the next year. The indication is that FBN is still underperforming and this is due to the fact that there are no positive results from some of the company's major investments.

For example, the Rainbow Town project in Port Harcourt, Rivers State, remains substantially uncompleted as at Saturday, 7 June 2014.

The project promoters should at this juncture concentrate resources on one of the high-rise buildings such that one building would be completed before the administration of Governor Amaechi leaves office in May 2015. If there is a completed building by this time, the in-coming administration would readily find it attractive to complete the project as a priority.

Otherwise, the project would be subject to further delays whilst various probes, studies etc are carried out by the new administration.

Union Bank of Nigeria Plc, UBN, expects to write off its accumulated losses once the resolutions to that effect are approved at its AGM. This should pave the way for UBN to declare a dividend at the next available opportunity.

The current directors of UBN should not ignore the circumstances in which some of these accumulated losses were inflicted on the company by the previous directors of the company. There is available evidence before the courts to the effect that funds belonging to UBN were misapplied by previous directors in the purchase of UBN shares.

However, the courts have only given a decision on whether there was manipulation of UBN's share prices on the NSE over a period of time. UBN and the previous directors have entered appeals against the decision on share price manipulation. One hopes that UBN would not eventually have to pay substantial sums as compensation when the appeals processes are completed whilst the previous directors walk away free from the issue of misapplication of UBN funds.

Shareholders are still not receiving annual reports, whether in paper format or CD-format. We have received reports from NBPlc, Mobil Oil and lists of unclaimed dividends No 10 - No 14 for Access Bank Plc in paper format whilst Dangote Flour Plc sent its report and lists of unclaimed dividends in CD-format.

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Source: AllAfrica

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