By Peter Egwuatu
Julius Berger Nigeria Plc has explained to investors that there was no need to float a rights issue at the moment as the Company’s shareholders equity has risen to N35 billion.
Speaking at the Company’s investor forum 2019 held in Lagos, the Managing Director, Julius Berger Nigeria Plc, Engr. Dr. Lars Richter who was represented by the Finance Director, Martin Brack said that 2018 was a very successful and pivotal year for Julius Berger, a business year filled with many positive developments and achievements.
In 2018, he explained “ Julius Berger successfully overcame many of the tough challenges faced in the recent past and made marked progress across all aspects of its business, moving to greater profitability and success. We don’t think it is necessary to float a rights issue at this moment as our shareholders’ equity has risen by N35 billion.”
Commenting on the 2018 financial year performance, he said: The Company’s revenue increased by 37 percent to N194 billion from N141 billion in 2017. The Profit Before Tax increased by 173 percent to N10.1 billion in 2018 from N3.7 billion in 2017, while Profit After Tax also rose to N6.1 billion in 2018 from N2.5 billion in 2017. This represents a 144 percent increase year on year and total comprehensive income increased by 47 percent.
Similarly, he told investors that the Company recorded significant progress in its first quarter results, saying it posted revenue of ₦35.32 billion for the period ended March 2018 compared to ₦34.15 billion reported for the period ended March 2017. This represents a 3 percent increase for the comparative period in 2017. The profit before tax was ₦2.21 billion for the period ended March 2018, compared to a ₦17.1 million loss before tax reported for the period ended March 2017. The company’s profit after tax for the period ended March 2018 was ₦1.49 billion compared to a ₦426.9 million loss after tax reported March 2017. It recorded earnings per share of 223 kobo for the period ended March 2018 compared to 7 kobo loss per share reported for the period ended March 2017. .
He also said that the record making progress Julius Berger has made at the second Niger Bridge Project site, reflects the company’s continued commitment to a timely completion of the project.
Dr Richter who showed a video clip of the intensive and extensive engineering construction works going on at the Second Niger Bridge in Asaba/ Onitsha since the short time the company has been awarded the main contract for the works, said, “the record setting progress Julius Berger has made at the site, reflects the company’s continued commitment to a timely completion of the project”.
Richter also reiterated that the Cold recycling methodology which the company introduced into the country at the ongoing Abuja Kaduna Zaria Kano Road works, “points to an efficient future of road construction, rehabilitation and maintenance in Nigeria”.
Speaking on the Lagos-Shagamu Expressway, which has seen delays and even work stoppage in the past, due to funding challenges, Richter said since the resumption of work, a steady pace of progress is now the reality. He said, “Considering that the Expressway is now financed via the Presidential Infrastructure Development Fund, we presume that we will be able to achieve an uninterrupted pace of work with the new funding structure”, Dr Richter said, adding that “Julius Berger remains fully committed to completion of this complex project, for the benefit of all”.
On the ongoing Bodo Bonny Road, Richter said that in spite of the project’s strategic socio–economic importance as well as its acknowledged challenges, “ as the first major contractor to enter Bonny Island over 20 years ago, Julius Berger has the experience and the technical knowhow to deliver the needed solution, and we are doing so”.
Speaking to the company’s success at both the completed Azura Power Plant as well as to the success of ongoing works at the Okpai Power Plant, Dr Richter also said “Power is a key sector for the future of Nigeria and for Julius Berger, and we now have the proven experience and knowhow to continue growing our portfolio in the power sector.”
Dr Richter made the remarks at the company’s Investor Relations Forum, which held at the Radisson Blu Hotel Victoria Island Lagos last Thursday, 9th May, 2019.
At the event, which has become a traditional pre-AGM presentation by the executive management of Julius Berger Nigeria Plc, the company’s shareholders and stakeholders were presented with raw data on the business activities and fortunes of the company over the 2018 business year as well as on its economic trajectory. The Managing Director, Engr. Dr. Lars Richter’s presentation dwelt on operational perspectives and outlook. He reviewed the business year 2018, status of operations and outlook for 2019 and beyond. With palpable and positively infectious enthusiasm, Dr Richter informed the investor forum that 2018 was a very successful and pivotal year for Julius Berger, a business year filled with many positive developments and achievements. In 2018, he explained, Julius Berger successfully overcame many of the tough challenges faced in the recent past and made marked progress across all aspects of its business, moving to greater profitability and success.
On quality and standards, Richter said Julius Berger, in 2018 also achieved the recertification of its Quality Management System, to meet the updated standards of ISO 9001, “Proving that despite much change, and in the face of external pressures, Julius Berger’s commitment to quality and process has not wavered”. This, said Richter, contributes greatly to Julius Berger’s enduring, thriving and enviable corporate culture which maintains the brands unique positioning”.
Richter also said that during the 2018 business year, the company effectively optimized its operational structure to ensure the best utilization of resources for projects’ needs. A seamless succession of the Executive Management was implemented and its structure was expanded to include a Directorate of Corporate Development. Strategically, the decision enabled a stronger focus on growth potentials, and provided an even more robust support for the identification and exploration of diversification opportunities and efforts. The result is that Julius Berger revved back from redundancy to renaissance, from the brink of sale of its equipment to investment in new machinery and technology, from firing to hiring again, with the target, to deliver on its new and increasing projects schedules.
In terms of mega-projects, Citing the Dangote’s Petroleum Refinery Project as one of Julius Berger’s ongoing mega projects, being a project set to be the largest refinery in Africa, Dr Richter said “Julius Berger has been successful in delivering the needed basic infrastructure within our scope of work, and due to good performance, have achieved additional scope. We will continue to strive for excellence to drive forward opportunities for our company”.
In addition, the ongoing FAFMA Office Tower in Lagos is developing with impressive speed. It has a promise to be a remarkable high-standard high-rise building set to be an iconic addition to Lagos’s skyline and a notable addition to Julius Berger’s portfolio of building projects.
The National Institute of Legislative and Democratic Studies is also a notable building project within our portfolio. Made up of several buildings, the construction of the campus has continued to progress, as is set to be partially commissioned late this month… thereby enabling it to fulfil its role as a world-class administrative and educational institution for the strengthening of democratic processes and structures in Nigeria.
On the fortunes and outlook for the company, Dr Richter said “Notwithstanding the challenges yet to be faced, Julius Berger continues to be in a strong position to succeed. The company has a firm competitive edge, driven by our commitment to quality, reliability, innovation and integrity – which reflects Julius Berger’s core values. Bolstering our position of strength is our robust order backlog and our diversified portfolio, which includes projects of National Priority…. Our strength is also reinforced by our commitment to innovation and the pioneering of state-of-the-art construction methods and technologies… and further supported by our leading quality management systems, unmatched HSE performance, and highly skilled and dedicated workforce…And last but not least, by the fact that our track record has earned us the trust of our clients, by way of our tried and true ability to reliably deliver, no matter the challenge”.
On the future of the company, the MD said, ” Looking forward, Julius Berger remains intent on continuing to strengthen our core construction business, in part by building on optimizations while maintaining our commitment to a standard of excellence second to none.
Richter, with buoyant optimism, added that Julius Berger “will continue to focus on strengthening the group, by further developing our subsidiaries… all of which have a great potential for increases in revenue and market share in their respective sectors. He cited the case of the growth already achieved with Julius Berger Services Nigeria.”