By NKIRUKA NNOROM

May & Baker Plc has disclosed plans to raise at least N3 billion from the capital market to boost its working capital.

The Managing Director, Mr. Nnamdi Okafor, who made the disclosure at a facility tour of the company’s production factory in Ota, Ogun State, said the company will be paying dividend to shareholders in the current financial year after failing to pay them dividend the previous year.

Though he did not disclose the date for commencement of the capital raising exercise, he said it will be through a combination of rights issue, private placement or debt equity by private investors.

He, however, ruled out raising the money through a public offer and undertaking further capital investment, saying that the company has done quite a lot in that direction in the last few years.

“We want to apologise to all investors and shareholders for our inability to give them something to smile about last year. We have actually in the past two or three years been trying to build strong foundation for the business so that we will begin to return very good profit and of course dividend.

“And I think that last year will be the last that we would have to deliver this kind of result because all the issues except the need to recapitalise have been addressed, and going forward, we believe that we should be in a better position to deliver good profit and dividend,” Okafor said.

I believe that the worst days are now behind us and that our company will progressively begin to deliver better returns. We have already started taking steps to reverse the loss position of 2013 and bring the company back to profitability.

“These measures include strategies to sustain revenue growth through more aggressive marketing and product initiatives, efficient management, enhancing working capital and aggressive reduction in overheads costs,” he added.

“We made some huge capital investment in the past three to five years. We are not going into any major capital investment anymore. What we need to do now is to shore up our working capital so that we will have to compete strongly in the market place and deliver value to all our shareholders.

So, the money we will be raising will be majorly for working capital,” he stated.

He also noted that the company is in the process of securing WHO certification, saying that an audit of the products and processes was conducted earlier this month.

According to him, “We expect that in the next couple of months, we should be able to scale through the first stage of bagging a World Health Organization (WHO) pre- qualification and look forward to fast tracking the second and final stage and before the end of the year, we would have our products pre/qualified,” he said.

The company had in 2013 financial year ended December 31, 2013, posted loss after tax of N103.089 million as against profit after tax of N75.943 million in 2012 and turnover of N6.368 billion compared to N5.668 billion posted in corresponding period in 2012.