Chams Plc has informed the Nigerian Exchange Limited (NGX) and the investing public that following the receipt of regulatory approvals, the Balance Sheet Restructuring exercise by the company was approved by a special resolution at the Extra-Ordinary General Meeting of the Company held on April 24, 2018 has been completed.
Balance sheet restructuring, also known as financial restructuring, provides a platform for businesses to undertake operational turnarounds and mitigate distress within. If acted upon quickly, balance sheet restructuring can often help businesses avoid formal insolvency.
Chams Plc has three subsidiaries; CardCentre Nigeria Limited, engaged in the production and manufacturing of Cards – Identity, payments, Smart cards etal; ChamsAccess Limited, licensed consortium for the deployment of ATMs in the country also involved in the deployment of multi-application terminals; and ChamsSwitch Limited, engaged in provision of the e-payment transaction processing platform for the Nigerian Market. At the NGX, the company’s shares exchanged at 21 kobo as of June 29, 2021.
Summary of the Group’s audited financial statement for the year ended 2020 shows Turnover dipped to N2.111billion from N3.285billion in 2019; Gross Profit came down to N759.515million in 2020 from a high of N1.008billion in 2019; while the Group reported Loss After Tax (LAT) of N919.676million in 2020 from Profit After Tax (PAT) of N322.624million in 2019. The Group closed 2020 with diluted/loss per share of 17kobo as against earnings per share of 6kobo in 2019.
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The directors in the 2020 audited financial statement said they made an assessment of the Company and its subsidiaries’ ability to continue as a going concern “and have no reason to believe the Company and its subsidiaries will not remain a going concern in the year ahead. The Consolidated and Separate Financial Statements of the Company and its subsidiaries for the year ended 31, December 2020 were approved on 30th March 2021”, the directors of Chams Plc said in their statement of responsibility signed by Demola Aladekomo, Chairman and Gavin H. Young, Group Managing Director.
Chams Plc said in a June 25 notice at the NGX signed by Yetunde Emmanuel, Company Secretary/Head, Legal Services that “The exercise was executed in the following manner: The Balance Sheet Restructuring Account (BSRA) was created for the purpose of effecting all necessary accounting entries in line with statutory requirements”.
“The sum of N5.458billion as of October 31, 2017 was transferred from the Share Premium as a credit to the BSRA; The negative balance of N5.458billion as of 31st October 2017 was transferred from the Retained Earnings Account to the BSRA; the Solicitors to the Balance Sheet Restructuring sought an order or orders to the following effect from the court,” the company said.
“An order of the Court confirming the above stated Balance Sheet Restructuring of Chams Plc was approved by Special resolution of its shareholders; All incidental, consequential and supplemental orders as are necessary to ensure that the Balance Sheet Restructuring were fully and effectively implemented; and The Directors of the Company were authorized to take all actions that were within their powers and/or necessary to effect the Balance Sheet Restructuring”, it further stated.
The principal activities of Chams Plc and its subsidiaries continue to be the provision of Digital business intelligent solutions across a broad range of market segments. This includes the development, deployment, implementation and maintenance of technology-based payment and other digital solutions including; facilitating the innovative development and operations of digital business.
