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On Nairametrics‘ Stock Picks, we take a look at a listed firm that is into industrial packaging products and services, Greif Nigeria Plc. Greif was incorporated as a limited liability company on January 20, 1940, with the name, Metal Containers of West Africa Limited. The name was subsequently changed to Van Leer Containers (Nigeria) Limited on July 4, 1969, and then, Van Leer Containers (Nigeria) Plc.

The Company’s name eventually became “Greif Nigeria Plc” by a special resolution on May 12, 2004.

The principal activities of the company are the manufacturing and marketing of metal drums and plastic containers.

Recent results

Results for the half-year ended April 2018, show that revenue fell sharply from N768 million in April 2017, to N312 million in April 2018. Profit before tax also dropped in a similar fashion from N73.6 million in 2017 to N5.2 million in 2018. Profit after tax fell sharply from N58.6 million in 2017 to N614,000.

Current share price N9.10
Year High: N9.10
Year Low: N9.09
Year to Date: 0.10%
One Year return: 0.10%

The stock has very thin float composed mostly of institutional investors. Greif International Holdings B.V. Netherlands holds 51% of the issued share capital amounting to 21,760,000 shares, the Van Leer Nigerian Educational Trust has 23% or 9,680,000 shares, and other Nigerian investors hold 11,200,000 shares.

The stock is currently trading at a year high of N9.10. It is 0.11% higher than its year low of N9.09


  • Greif is currently trading at 7 times earnings per share.
  • In terms of price to book ratio, the market values it about 1x its book value.
  • The company hasn’t declared any dividend.


As a result of poor business performance, the company recently took steps to restructure its operations. In a notice sent to the Nigerian Stock Exchange (NSE) early last month, management disclosed that it would be shutting down its operations in Koko, Delta State, and Kaduna.

The Apapa factory would be upgraded to world standards and manufacturing will be concentrated there. Products will also be distributed across the country from Apapa.

The release, however, made no mention of redundancy/retrenchment costs for the staff affected.

In what seems to be a prescient move, the firm declined to pay a dividend in its full year ended October 2017, opting to retain all earnings. Should the poor results continue, the firm could incur a loss in its 2018 financial year. At this rate, it will barely be able to repeat its 2017 full year performance.


For shareholders, prospects of a dividend payment for the 2018 financial year are quite slim. Should this happen, this would the second consecutive year of no dividends.


The company has an intercompany trade payable balance of US$897,833 (2016: US$902,681) due to its sister company, Greif South Africa. As at reporting date, there is uncertainty as to the timing and repayment of the balance.

In the event of a sharp depreciation of the Naira against the dollar, the company could be saddled with a large debt. Precedents from other firms with foreign owners show that such debt, in the event of difficulty in payment, is converted into equity. Thus, minority shareholders may bear the brunt of this action.

The company is also exposed to foreign exchange volatility through the raw materials it imports especially aluminum.

While crude oil prices are forecast to remain within the $60-$70 range, forthcoming elections tend to lead to threats by militants to disrupt production.

At the peak of the 2016/2017 foreign exchange crisis, many companies struggled to access foreign exchange. This led the Central Bank of Nigeria (CBN) to create a special FX window for businesses.



The company in its 2017 full year report disclosed it was facing tougher competition from new entrants as well as pressure to reduce prices. If this persists, it may result in lower profit margins and revenue.

Other players in the space include Nampak Nigeria Plc and Avon Crowncaps (both of which have since delisted and embarked on restructuring).

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via onome.ohwovoriole@nairametrics.com


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