Notore Chemical Industries Plc yesterday listed N1.61 billion ordinary shares of N0.50 each at N62.50 per share on the Nigerian Stock Exchange (NSE). At its listing price, this amounts to a market capitalisation of N100.75 billion. This also marks the first new listing of a company on the NSE this year.
The company held a Facts Behind the Listing presentation after the ceremony. Present at the event where board and management of the company led by its Chairman General Yakubu Gowon (rtd).
Here are highlights from the presentation by the Group Managing Director Onajite Okoloko:
Current capacity
The plant currently has a production capacity of 15,000 metric tonnes per day of Urea, 1,000 metric tonnes per day of Ammonia, and 2,000 metric tonnes per day of NPK fertilizer.
Challenges surmounted
Gas supply had in the last few years of operation been unstable leading to a shutdown of production. Notore is currently the only fertilizer company in the country that has control of its own gas supply. The company signed a gas supply agreement with the Eroton Production and Exploration Limited to supply enough gas for 3 or 4 new plants from OML 18.
Natural gas accounts for 80% of the raw material input required for the production of urea fertilizer.
Guide against faking
In order to guide against faking of its products, the company distributes them through a network of trusted distributors. Only long-standing distributors are allowed to pick up fertilizer straight from the factory.
Room for growth
Okoloko also stated that Nigeria had enough room for growth as fertilizer consumption in the country was still quite low, compared to Pakistan a country with similar geography.
Pakistan has a fertilizer consumption rate of 100 kilograms per hectare. Nigeria has a consumption rate of 8-10 kilograms per hectare. Pakistan produces 10 million metric tonnes per annum of fertilizer. Nigeria produces 1.5 million metric tonnes per annum.
Short term goals
In the short term, the company hopes to complete a scheduled Turn Around Maintenance (TAM) of its plant by September 2019. This will enable the firm increase its capacity to increase its current production level from 1,000 metric tonnes per day to 1,500 metric tonnes per day.
$37 million was raised from a Development Finance Institution. Notore has an annual revenue target after TAM of N50 billion.
The company also plans to develop a 50-megawatt gas-fired plant and sell excess power to the national grid.
Medium term
For its medium-term goals, the company plans to introduce new fertilizer blends and commence dredging at its jetty. Engineering design and early works have commenced on a proposed second plant.