By Akintola Omigbodun

The Annual General Meetings, AGMs, of companies that are quoted on the Nigerian Stock Exchange, NSE, have taken place in the past few months. These AGMs have considered the reports and accounts of the various companies for the year 2014. Forte Oil Plc published its reports and accounts early although it was not the first company to have its results published as it was the previous year.

Forte Oil Plc has a 57 per cent stake in Amperion Power Distribution Company which in turn has a 51 per cent stake in Geregu Power Plc, a thermal power station located in Ajaokuta, Kogi State. The gross profit from all of Forte Oil Plc various operations is N18.46billion out of which power generation is contributing N4.74billion. This is an indication that the power generating companies on the national grid can make a profit at current electricity tariff levels.

One hopes that the Bureau of Public Enterprises/Ministry of Finance Incorporated would be able to tell the public what dividends have been earned from the Federal Government’s 49per cent stake in Geregu Power Plc. We would see from the above example that the reports and accounts of a company can provide useful information to the company’s shareholders and to others. The idea that the reports and accounts are meant solely for the purposes of the AGM is mistaken.

A shareholder in a company has the right to know how his investment is performing and the shareholder can at any time ask for the company’s financial statements. The piles of company annual reports that are found in the offices of some company registrars have clearly never been sent to any post office. This year, I have not received any reports and accounts either in CD format or paper format. One of the companies did send me indication of its rights issue and if this got through to me, I should have received the company’s reports and accounts as well.

The ability of a company to reach its shareholders would determine the success of efforts to dematerialize share certificates and to end the incidence of unclaimed dividends. I recently looked at the websites of Nigerians Breweries and Dangote Sugar. Nigerian Breweries in its 2014 annual reports simply stated that some dividends and share certificates have remained unclaimed. In contrast, Dangote Sugar, in several pages in its 2014 annual reports, gave the names of shareholders with unclaimed dividends.

I am aware that the company registrar for Nigerian Breweries, First Registrars, believes that the publication of lists of unclaimed dividends would encourage fraudulent claims. According to its 2014 annual reports, Nigerian Breweries has 113,031 shareholders. The company is very active in promoting all its products and I believe the company can organize a promotion that would bring out its shareholders with unclaimed dividends and share certificates.

Some of the banks have large numbers of shareholders arising from the share offers in 2007 and thereabouts. FBN Holdings in its 2014 annual reports has 1,215,146 shareholder accounts. First Registrars should be able to tell us how many of these accounts are held as share certificates and how many are held with the Central Securities Clearing System Limited.

This would give an idea of the work that has to be done if we are to get all share certificates dematerialized. Out of the 1,215,146 FBN Holdings shareholder accounts, 836,923 of these hold between 1 and 5000 units of shares with their total holdings being less than 5 percent of the company’s 32.63billion units of shares. I hope that whatever policies are put in place for the dematerialisation of share certificates would recognize the need to cater for the large numbers of investors with small holdings.

TO BE CONTINUED