Efficient management of men and resources pushed up the revenue of Beta Glass plc by 18.6 percent, from N22.186 billion to N26.321 billion in the financial year ended December 31, 2018.
The growth was mainly driven by price increases in response to inflationary trends and partly by higher volumes, Otunba Abimbola Ogunbanjo, chairman of Beta Glass, said at the annual general meeting held in Lagos.
Gross profit was 24 percent of sales, which was 22 percent higher compared to previous year. Prudent deployment of resources boosted returns, improving profit before tax (PBT) to 27 percent of sales. Operating income was strong at 22 percent of sales, showing a healthy improvement of 35 percent compared to the previous year. Finance income rose by 11 percent to N1.41 billion for the year, as net profit margin stood at a healthy 19 percent, remaining broadly steady compared to the prior year.
“Notwithstanding the increased capital expenditure (capex) needs, your company closed the year with a very robust cash position of N8.9 billion, auguring well for critical capex requirements in the coming years,” Ogunbanjo told shareholders.
“I am pleased to inform you that the glass business delivered on its plan and successfully completed the furnace cold repair faster than expected at the Delta Plant last year, thereby enhancing its efficiency and capacity.
“We have also commenced preparations towards furnace rebuild in Agbara plant, which is scheduled for H1 2020. This furnace rebuild is a strategic project targeted at the transformation of the company’s glass capacity for Nigeria and the export markets, for the anticipated growth and demand for glass in Nigeria,” he stated.
The glass maker’s financials further show that shareholders’ equity improved by N4.4 billion when compared with the previous year, resulting from the strong profit and adjusted for the dividend distributed during the year.
Ogunbajo disclosed that the board recommended a gross dividend of N1.30 kobo per share subject to the deduction of 10 percent withholding tax.
This, he said, represents a 22 percent increase in value from last year’s dividend and is consistent with the company’s dividend policy to pay out 13 percent of net profit after tax.
Assessing the 2018 financial year, he said the expectation of stronger growth in the economy was dampened by contraction in the oil and gas sectors, contractions in the agricultural sector due to farmers-herders clashes, including increased political tension.
He pointed out that while the exchange rate was relatively stable in 2018 in different segments of the FX market, including the Importers’ and Exporters’ (I & E) foreign exchange window, businesses experienced severe logistics challenges owing to the state of Apapa and Tin Can link roads.
“The gridlock at the two functional ports in the country, the Lagos Apapa and Tin-Can Island ports, wreaked havoc on international trade, haulage, commuting and business activities. Traffic congestion on major road networks in Lagos took its toll on man hours while businesses dependent on importation and export, and big factories located within the Apapa/Wharf axis of Lagos State, reported weaker volumes,” he recalled.
He expressed confidence that with the elections over, structural challenges confronting the economy in critical sectors such as oil and gas, power, infrastructure and healthcare would be addressed and resolved to move the economy to the next level of growth.
Odinaka Anudu
