The profit margins for corporate organisations are beginning to lay bare the dire strait of the Nigerian economy as local investors in construction giant, Julius Berger Nigeria Plc, for the first time in over two decades of operation in the country did not smile home with dividend pay-outs.
The company recorded N3.7 billion loss in its 2016 financial year made public yesterday at the its 47th Annual General Meeting in Abuja. The N3.7 billion losses are against the N2.8 billion profits it recorded in the 2015 financial year.
It also declared a zero dividend of 2.68 basic earnings per share as against the 2.01 earnings per share in 2015. Addressing Shareholders at the AGM, Chairman of the company, Mr. Mutiu Sunmonu attributed the poor performances to the current recession ravaging the Nigerian economy.
Sunmonu observed that ‘’the shrinking economy brought new and ever-increasing challenges with far- reaching consequences , compounding the critical situation with persistently lower crude oil prices, reduced crude oil production, accelerated inflation, naira devaluation and a shortage of foreign currency which magnified hardship, making economic turn-around increasingly tough’’.
He said Julius Berger and its subsidiaries were not insulated from this harsh reality adding that across the group, the Management made enormous efforts to protect profit and reduce risk while proactive measures were taken in previous years proved to be instrumental in supporting the Group’s ability to withstand the prolonged nature of the economic downturn, requiring more aggressive strategies and additional actions over the past year as the situation worsened.
‘’The major focus of the company was on reducing forex exposures both to keep the Group afloat and also to position our business to be more competitive going forward, considering the devastating impact of the current crisis’’, he said.
The Chairman noted that actions taken to arrest the situation include, further downsizing of operations through the consolidation of administrative structures, closure of production facilities, merging of operational units as well as the additional reduction of staff strength especially international staff.
On the good side, the Sunmonu said, ‘’Despite the trying circumstances and increased competition for the fewer viable projects on the market, Julius Berger Nigeria Plc and its subsidiaries were still successful in acquiring several projects, the company’s new awards include, the Rivers state Government House and Pleasure Park in PortHarcourt, a multi functional leisure and recreational park, several building projects and the rehabilitation of the runway at the Nnamdi Azikiwe International Airport in Abuja as well as the rehabilitation of various roads in PortHarcourt and Lagos’’.
He encouraged the staff and shareholders to maintain their faith in the company noting, ‘’Julius Berger Nigeria Plc and its subsidiaries shall ensure core strength are maintained across the Group, across business, as dedication to providing efficient and value-driven planning and execution of projects will remain a top priority, this commitment coupled with the continued emphasis on quality management ensures continuous improvement in the effectiveness of key business processes thereby guaranteeing that the company and its subsidiaries remain well equipped to consistently meet clients demand to superior and reliable delivery’’.
Some of the share holders who had to go home with dividends this year bared their minds to The Guardian on the outcome of the AGM. They said as concerned shareholders, Julius Berger Nigeria Plc still have great hope for them “as shareholders with faith, we believe this hard times would soon be over and JBN would soon take its rightful place as the giant in the industry and we will all smile again, Mr Ojo Makinde and Mrs Joy Onu assured .
• The Guardian