DAAR Communications Plc has finally reached an out-of court settlement with its creditor, Fidelity Bank Plc over an outstanding N7.5billion loan. Daar Communications accessed this loan from Fidelity to fund the broadcast of the FIFA under 17 World Cup hosted by Nigeria in 2009.
In his speech at the Daar Communications 4th Annual General Meeting, Raymond Dokpesi the company’s board Chairman disclosed that all issues relating to the loans have been amicably resolved and all cases in court withdrawn by both parties.
A Federal High court in Lagos had in April 2012 ordered Chief Raymond Dokpesi and his company, DAAR Communication Plc to repay a debt of N7.5bn debt owed Fidelity Bank Plc.
The court also ordered Dokpesi and his company to pay the bank 21 per cent per annum on the amount owed from May 31, 2011 until judgment and 21 per cent interest per annum from the day of judgment until final liquidation.
At the AGM, Dokpesi assured the shareholders who could not receive dividends that with the resolution together with the ongoing and strategic repositioning programmes of the company, the future of the company is bright and assured investors of better returns on their investments.
He attributed the poor performance of the company within the 2011 financial year to huge interests on this loan which was weighing down on the Daar’s financials coupled with the unfriendly business environment which greatly affected the media industry.
“The unstable power supply situation in the country, the security challenges, the unstable economic policies of the government, inadequate infrastructural facilities, unstable exchange rate of the Naira and other spice economic variables adversely affected the company’s operations” he said.
Dokpesi disclosed that in spite of these challenges, there was a slight increase in turnover from N4.8 billion in 2010 to N5.1 billion in 2011.
But the company’s net loss position regrettably increased from N1.5billion in 2010 to N4.0 billion in 2011.
Interests and similar charges which include interest on Fidelity Bank loan accounted for about 76 per cent of the year’s net loss position adding that the financial situation therefore made it difficult to declare dividend to shareholders.
He informed the shareholders that AIT and Raypower broadcasting stations have been established in 12 states of the federation as well as the Federal Capital Territory (FCT)