Despite that the prospects for growth in 2014 remain modest, given the economic and business risks that currently play up in Nigeria, UAC of Nigeria plc, a diversified conglomerate, is optimistic as to its prospects in the medium term.
The company with interests in four primary verticals – Food and Beverages, Real Estate, Paints and Logistics – holds controlling interests in 10 entities with the four verticals, including a closed pension fund administrator.
Shareholders of the company were recently told at its annual general meeting that it was integrating its two newly acquired businesses – Livestock Feeds plc and Portland Paints and Products Nigeria plc – into the UAC family as it continued to build on the synergies created by its various strategic alliances with other industry leaders.
The financials
In the financial year ended December 31, 2013, UAC of Nigeria plc sustained its impressive performance as operating profit grew to N15 billion from N11.5 billion in 2012. It also recorded a commendable top-line growth of 13 percent from N69.6 billion in 2012 to N78.7 billion in 2013. Profit before tax rose from N10.75 billion to N14.01 billion. Earnings per share rose from 257 kobo to 296 kobo.
The company’s salient performance graph over a five-year period shows that turnover grew from N56.5 billion in 2009 to N78.7 billion in 2013. Operating profit also grew from 2009 level of N7.56 billion to N15.26 billion in 2013. Earnings per share, which had dropped from 314 kobo in 2009 to 199 kobo in 2010 and 37 kobo in 2011, rose to 294 kobo in 2013. Dividend per share, which also plunged from a high of 130 kobo in 2009 to 110 kobo in 2010, rose to 175 kobo in 2013.
The board’s view
“The future of UAC is indeed bright as we are poised to reap the benefits of the investments we are currently making, as well as the capacity upgrades we are undertaking in our various businesses,” said Udoma Udo Udoma, chairman, UAC of Nigeria plc.
The company, which had its share price at N66 at the close of deals at the Nigerian Stock Exchange last week, is very much optimistic that as it continues to align its businesses to deliver good returns to its shareholders.
According to Udoma, “we have taken other strategic initiatives geared towards minimising our business risk and exposure. This includes the ongoing implementation of enterprise-wide risk management framework and the deployment of SAP (systems, applications, products in data processing) as our enterprise resource planning software.”
He told shareholders that: “We currently have strategic partners in Tiger Brands Limited for UAC Foods Limited, Imperial Logistics for MDS Logistics Limited, and Famous Brands for our UAC Restaurants Limited businesses. These bold initiatives have repositioned our group for sustainable growth and improved performance in the years ahead.”
Keeping the divided policy
Due to the impressive performance recorded in 2013, and in line with the company’s dividend policy, the board recommended and got shareholders approval to pay dividend of N3.4 billion, representing 31 percent over the N2.5 billion paid in 2012. This represented 175 kobo per ordinary share of 50 kobo each.
Since becoming a public company in 1974, the company has declared dividends and issued a number of scrip shares. Its unclaimed dividend accounts indicate that some dividend warrants have not been presented to the bank for payment while others have been returns to the registrar – now Africa Prudential Registrars plc. Its unclaimed dividend as of June 2013 was N500.7 million.
Shareholders information
Annual report of UAC of Nigeria plc, presented to shareholders at the meeting, shows that one shareholder (Stanbic Nominees Nigeria Limited) held more than 5 percent of the issued share capital of the company at December 31. According to the register of the company in the review 2013 financial year, Stanbic Nominees Nigeria Limited held 354 million units or 18.43 percent of UAC of Nigeria plc shares.
