Shareholders of Nestle Nigeria Plc. on Tuesday endorsed a total dividend of N7.93 billion, declared by the company, for the financial year ended Dec. 31, 2016.
The shareholders gave the approval at the company’s 48th Annual General Meeting (AGM) held in Lagos.
Newsmen report that the dividend translated to N10 per share, compared with N21.79 billion, representing both interim and final dividend, paid in the corresponding period of 2015.
Mr Sunny Nwosu, National Coordinator Emeritus, Independent Shareholders Association of Nigeria (ISAN), lauded the company for the dividend declared, in the face of challenging environment.
Nwosu appreciated the board, management and staff of the company for performance posted in the period under review.
He said that the company’s products quality must be sustained to maintain its leadership position in the industry.
Nwosu urged the company to extend its water business production line to South-East to tap into enormous opportunities in the area.
He also urged Nestle to issue bonus scrip, noting that it had been a long-time a bonus was declared.
Mr Williams Adebayo, another shareholder, said that the company should map out strategies, aimed at reducing loans and borrowings.
Adebayo stated that the company should consider rights issue for fresh funds, to reduce borrowings.
Mr Nona Awo, said the company must liaise with the registrars and its investors’ relation on ways to address the rising unclaimed dividends.
Awo said that there was the need for collaboration between the registrars and investor relations officer, to drive down the figure.
He also urged the company to work with a major Nigerian university on research and development to improve local source of raw materials and reduce cost.
The shareholder activist implored the company to ensure return of interim dividend payment, which was stopped in 2016.
He said that the company must declare an interim dividend in the current financial year to compensate the shareholders.
Mr David Ifezulike, the company’s Chairman, told the shareholders that 2016 was a challenging year due to scarcity of foreign exchange, devaluation of the naira and unfriendly economic policies, among others.
Ifezulike said that scarcity of foreign exchange and devaluation of the nation’s currency led to increase in the company’s foreign loans portfolio.
He said the Central Bank of Nigeria’s (CBN) current foreign exchange policies had enabled the company to pay back most of its foreign loans.
The chairman noted that the company was considering a lot of investments ideas such as spreading to South-East and South-South, saying that it would declare public at the appropriate time.
Ifezulike said that the company was considering issuing bonus but would present it to the shareholders when the climate was right.
He called on the shareholders to embrace the e-dividend payment platform initiative to reduce spate of unclaimed dividends.
The chairman said that the company employed 111 new employees in 2016 in spite of the challenging operating environment.
He said that Nestle remained fully committed to the long-term potential of its business in Nigeria.
Newsmen report that the company posted a turnover of N181.9 billion in the review period compared with N151.3 billion in 2015, an increase of 20 per cent.
Its operating profit stood at N38.2 billion in contrast with N33.7 billion in the preceding year representing a growth of 13 per cent.
Profit after tax dropped to N7.9 billion against N23.7 billion in 2015, due to expiration of the pioneer status and revaluation of dollar denominated loans.