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FMN Announces 20% Dividend Increase In Q4

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Nigeria’s leading integrated food business and agro-allied Group, Flour Mills of Nigeria Plc (Flour Mills or FMN), has announced its audited 2018/19 financial results, ending the year with a strong quarter 4, a full year result that shows a 30% reduction of its financing cost and a strengthened balance sheet, enabling the Group to increase its dividend by 20%.

Key Highlights The Group’s Q4, 2018/19 improved by N1.9 billion, when compared to the same period last year, with full year Profit Before Tax of N10.2 billion, compared to N16.5 billion in the year ended 31st March 2018.

Deleveraging continued with total net debt reducing by N21.2 billion and financing costs by 30% (N9.8 billion Naira) to N22.9 billion as at 31st March 2019 Proposes dividend increase of N0.20k to N1.20k per share.

This is subject to shareholders’ approval at the company’s AGM. 2019 outlook – Continuous growth is envisaged in key segments such as Food and Agro-Allied, as targeted strategies deliver improved margins and operational efficiencies.

Continuous implementation of turnaround initiatives in the Agro-allied business, accelerated expansion in the B2C segment, optimal operation of our supply chain and further balance sheet management is expected to result in higher profitability.

Operational Review In spite of the prevailing economic headwinds and harsh operating environment which is further heightened by the logistics challenges in Apapa; FMN has continued to make remarkable progress with the Group’s strategic directive to focus on market expansion while realigning its food and agro-allied businesses for sustainable growth and profitability.

In 2018, we undertook a series of strategic actions designed to improve returns and deliver maximum gains for our investors.

Top of such actions was the restructuring process that saw all FMN Group businesses in the agriculture sector aligned under Golden Fertilizer company, a fully owned Holding company.

The decision has already started to yield appreciable improvements within the group, in the areas of cost maximization and improved operational efficiency as the businesses make the most of their competitive advantage and synergies.

This is further supported by the strong cost control measures that have been put in place by management within the year under review, In the agriculture space, FMN has continued to consolidate on its investments, with a strong focus on innovative and efficient use of resources.

Accordingly, the Group is resizing and simplifying the operations of some of the farms which form an integral part of our backward integration strategy with a few of the smaller experimental farms being scaled-down, whereas we continue to focus on the key units.

Commenting on the result, Anders Kristiansson, Group Chief Finance Officer, said: “Our strategy to restructure the balance sheet base and optimize the financing costs have started to yield the desired results, as the business showed increasing levels of efficiency.

Despite ongoing pressures on consumer disposable income in many of our target categories, we continued delivered a stronger quarter 4 than last year.” Paul Gbededo, our Group Managing Director, commented: “We have made substantial progress this year, even in the face of an adverse and challenging business environment.

Our growth and efficiency initiatives across our various functions and businesses have started to show anticipated gains as we continue to focus on organic sales growth and position the business for continuous profitability.

FMN has undergone several functional and structural changes within the last year, with innovation and focus on our consumers, at the heart of our strategic direction.

We are positive that we will see even greater achievements in our financials in the following quarters as we continue to focus on value creation for our shareholders.

To that end, we will be proposing the declaration of a dividend to our shareholders with a significant increase over last year.”

Auditing

Bidvest Bank trading profit rises 3.5% to R6.7bn

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The Commercial bank in the Republic of South Africa trading, distribution and services group Bidvest said recently its trading profit for the year ended June 30 rose 3.5 percent to R6.7 billion despite flat revenue.

Headline earnings per share were up 9.8 percent to 1,352.1 cents and the company said exceptional cost and capital discipline as well as improved margins were highlights against a volatile trading backdrop.

The CEO Bidvest Bank Lindsay Ralphs said, “There has been a strong focus on our clients, on solutions, innovation, wholesaling the right product at the appropriate price point as well as bolt-on acquisitions in the services and office & print divisions, which has culminated in acceptable growth.”

The group declared a final cash dividend of 318 cents per share, bringing the total dividend for the year to 600 cents, up 7.9 percent from last year.

Strong profitability gains were achieved at Adcock Ingram while Comair recognised the successful claim awarded against South African Airways, which increased Bidvest’s share of profits from these associated companies.

Bidvest said its diverse portfolio of businesses and extensive reach allowed it to weather challenging times.

“Our basic-need services and everyday essential product ranges enable us to support and add value to all our stakeholders. Innovation to disrupt ourselves, and the industries in which we operate, remains a core focus alongside disciplined asset management and cost control,” Ralphs added.

 

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Guinness Nigeria Declares N5.5bn Profit, N3.3bn Dividend

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A leading beverage alcohol firm in Nigeria Guinness Nigeria, recently announced a profit after tax (PAT) of N5.483 billion for the year ended June 30, 2019, compared with N6.718 billion. The profit was actualized from a revenue of N131.498 billion as against N142.975 billion in 2018.

Net financing income fell from N3.443 billion to N1.862 billion, while profit before tax (PBT) was N7.103 billion, down from N9.943 billion in 2018. The board of directors has recommended a dividend of N3.329 billion.

Commenting on the result, the Managing Director, Guinness Nigeria Plc, Mr. Baker Magunda, stated that the company would continue to work on all operating indices while expecting that the micro and macroeconomic parameters improve.

Magunda mentioned that: “Revenue for the year declined 8% compared to same period last year on the backdrop of an extremely challenging macroeconomic and competitive environment. The cost of the increase in excise duty at a time of stagnant consumer disposable income had to be absorbed by industry players. Despite the tough competitive landscape, we continue to see good growth performance from Guinness, Spirits and the malt drinks.”

According to him, a combination of factors, inflation plus prior year royalties and accruals not approved by NOTAP, led to a 17 per cent decline in gross profit for the organisation.

Magunda explained that “Marketing spend reduction by 16 per cent and distribution costs initiatives partly mitigated the gross profit decline, thus leading to a fall in operating profit by N4.4 billion. Profit before tax decreased by N2.8 billion as a 46 per cent reduction in net finance costs further helped to cushion the decline in operating profit,”

Also speaking on the performance, Chairman of the company, Mr. Babatunde Savage, said: “As a board, we are confident that our strategy is sound, and that we are making the right investments in the company to ensure our long-term competitiveness. The Board will continue to support the management in its efforts to build a business that aims to consistently deliver growth for stakeholders.”

The company noted that despite the challenges, it continues to fulfill its commitment to stakeholders particularly as it drives its renewable energy and water recovery project for sustainable environment.

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Zenith Bank grows profit to N111.7bn, in H1’19

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Nigeria’s leading financial service Zenith Bank Plc has announced profit before tax (PBT) of N111.7billion and proposed interim dividend of 30 kobo per share for the half-year ended June 2019 (H1’19).

This was disclosed by the bank in its audited financial results for H1’19 released recently which showed improved performance in key financial indicators.

In a statement announcing the results, the bank said: “Gross earnings grew by three percent from ¦ 322.2 billion to ¦ 331.6 billion driven by a significant growth of 24 percent (YoY) in non-interest income from ¦ 88.6 billion in H1 2018 to ¦ 109.7 billion in H1 2019.”

It further said: “In particular, fees from electronic products increased by ¦ 17 billion (168 percent) from ¦ 10 billion in H1 2018 to ¦ 27 billion in H1 2019, demonstrating significant progress in our retail banking initiatives.”

“This top-line growth filtered through to the bottom-line as Profit Before Tax (PBT) increased to¦ 111.7 billion reflecting a four percent growth over ¦ 107.4 billion reported in H1 2018 with earnings per share (EPS) increasing by nine percent to ¦ 2.83 in H1 2019 from ¦ 2.60 compared to the prior period.” It added.

 

 

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