Shareholders of Dangote Flour Mills have commended the management of the company for returning the company to profitability after four years of losses.
Speaking to newsmen in Lagos at the company’s annual general meeting (AGM), shareholders urged the management to create more awareness for the company’s products range as they are of high quality and globally competitive.
Addressing them, Chairman, Dangote Flour Mills, Mr Asue Ighodalo said “Despite the tough business environment, I am delighted to announce that your company delivered impressive results.
“Our turnover during the period was N105.7 billion, representing an increase of 120.2 per cent above the N48.0 billion recorded in the 2015 financial year. Gross Profit improved by 556 percent during the period, rising to N29.3 billion from N4.4 billion in the prior period.”
He stated that as a result, the company effected a complete turnaround on its bottom line, recording a profit after tax of N10.6 billion compared with a loss of N12.7 billion in the prior year.
On the inability to pay dividends, Ighodalo said “Despite the good performance of our company in the current financial year, the directors are unable to recommend a dividend payment.
“You will recall that the company recorded continued losses in the preceding four years, as a result of which accumulated losses stood at N23.1 billion as at 30 September 2015.
“Unfortunately, despite the best efforts of your board and management the accumulated loss position was not fully extinguished by the current year’s results.
“We are therefore unable to declare any dividend because financial standards and regulatory considerations only allow payment of dividends from accumulated profits,” he said.
Ighodalo however assured shareholders that the Board will continue to focus on sustaining high product quality, improving customer engagement strategies and strengthening supply chain capabilities.
“We will continue to work extremely hard to enhance the value of your investment in our company. With your unalloyed support, we look forward to consolidating on these gains in the coming year.”
A shareholder, Alhaji Muktar Muktar, commended the Flour Mills management for reopening the shut Kano Mills. According to him, the reopening of the Kano Mills contributed to the increase in sales volume recorded by the flour mill.
He said that with return to profitability after years of losses, shareholders are encouraged that the board will recommend dividend payment in the coming years. He said that the turnaround in the fortunes of the company is not surprising as any investments associated with Dangote produces results. He tasked the management not to relent in ensuring that the profit recorded in the 2016 financial is surpassed.
He stated, “I want to commend you for this result. It clearly shows that this board is highly proactive and ready to tackle the problems of this company. You have significantly reduced the accumulated losses and reduced borrowing, I believe that under your leadership we should be able to receive dividends in the next couple of years.”
Idowu Monsur, another shareholder speaking at the AGM specifically tasked the management of Dangote Flour Mills to ensure that all their products are available in the market. He said that the same way Dangote Cement has dominated the cement sector, the company should dominate the flour products market. According to him, with the high cost of rice, availability of the products will compel people to shift to consumption of pasta instead of rice.
Executive Director, Sales & Marketing, Halima Dangote at the post AGM interview toed the same line saying that Dangote Flour Mills recently re-vamped its pasta range as to reduce the dependency on rice consumption by Nigerians.