Steel Drum maker, Greif Nigeria Plc has decided to suspend operations in the country. The firm’s Chairman, Adebayo Olowoniyi, made this disclosure in its 2018 full year financial reports for the period ended 31 October 2018 released on Wednesday this week.
According to Olowoniyi, the company has been operating below operating cost even below direct material costs noting that the company had tried to stay afloat through price increases and embarked on cost reduction initiatives.
Halfway through its financial year, the company lost a key customer and had to reduce prices to retain volumes, leading to an under-recovery of costs.
“Therefore we have decided to stop operations with immediate effect. In the coming months, we will investigate on if and/or how we can continue with Grief Nigeria,” he said.
Results for the twelve months ended October 2018 show revenue fell by 62% from N1.4 billion in 2017 to N534 million in 2018. The firm recorded a loss before tax of N245 million in 2018, as against a profit before tax of N77.5 million in 2017.
The 2018 financial year was a very challenging year for Grief Plc as its factories in Kaduna and Delta states remain non-profitable, while the Kaduna plant contributed just a tenth of its total revenue for Q1 2018 and the Delta plant virtually dormant.
The Board of the company in May 2018, announced the closure of factory plants in both Koko, Delta State and Kaduna, Kaduna State with the commencement of complete evacuation of all machines and equipment.
Greif Nigeria Plc 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. Greif International Holdings B.V. Netherlands holds 51% of the issued share capital amounting to 21million shares, the Van Leer Nigerian Educational Trust has 9.6million amounting to 23% shares, other Nigerian investors hold 11.2million ordinary shares.
OLUFIKAYO OWOEYE & SEGUN ADAMS
