UAC of Nigeria Plc has outlined strategic plans that are expected to drive growth while addressing the issue of dwindling profitability, which has plagued the company in recent years.
UACN’s Chairman, Mr Dan Agbor, made this known while speaking at the company’s annual general meeting (AGM) held in Lagos on Wednesday, June 20, 2018. According to him, the proposed strategies will focus on important areas such as capital allocation, human capital development, portfolio composition, as well as the reinforcement of accountability and responsibility.
More so, UACN Plc plans to consider compensating employees based on how much value they bring to the group.
Agbor also stated that they will use 2018 as a ‘transitional year’ for the implementation of these initiatives.
“I am excited by the challenges as well as by the opportunities that lie ahead, and I assure you that your board and the management of your company are well equipped to meet these challenges and take advantage of the opportunities in the Nigerian economy generally and in our existing businesses more specifically” – Agbor
Over the past five years, UACN’s revenue has maintained relative consistency, even though profitability has been on the decline. For example, whereas turnover for the year ended December, 2017, stood at ₦89.1 billion as against ₦82.6 billion in 2016, profit declined drastically to just ₦963 million, down from ₦5.6 billion in 2016.
The Nation reports that this reflects the compression in the margins of operating subsidiaries.
UACN Plc recently shutdown one of its subsidiaries, Warm Spring Waters Nigeria limited, which produced and marketed Gossy portable water. The decision was due mainly to weak performance. More brands could potentially be shelved also as the company continues to review its business strategy.
Meanwhile, the company’s shareholders, yesterday, approved the payment of ₦1.86 billion as dividend for the 2017 financial year. The sum will be split at 65 Kobo per ordinary share.
Chances abound that the company will soon rebound, especially considering all the plans that have been put in place. The company also has the backing of its shareholders who, despite the recorded unfavourable performances, went all out to over-subscribe a ₦15 billion rights issue late last year.
The proceeds of the rights issue are being utilised towards the actualisation of the strategic goals that were earlier highlighted.
UAC of Nigeria Plc is one of the oldest corporate entities in Nigeria. It has a diversified operation, with investments in the FMCG market, real estate, paint production, logistics etc.
Its shares traded at ₦14.40 during today’s NSE session.