Shareholders at the weekend in Lagos applauded the Dangote Flour Mills return to profitability after posting a profit before tax of N11.82bn for its financial year ended December 31, 2016.
The Chairman of Dangote Flour Mills, Asue Ighodalo, while addressing shareholders at the 11th Annual General Meeting in Lagos said “Despite the tough business environment, I am delighted to announce that your company delivered an impressive turnover of N105.7 billion during the financial year, representing 120 percent increase over turnover recorded in the previous financial year and a 556 percent increase in gross profit rising from N4.4 billion in the previous financial year to N29.3 billion in the current year.”
The company achieved a complete turnaround on its bottom line, recording a profit after tax of N10.6 billion compared with a loss of N12.7 billion in the prior year.
A shareholder rights activist, Alhaji Muktar Muktar commended the Flour Mills management for returning the company to profitability as well reopening the shuttered Kano Mills. According to him, the reopening of the Kano Mills contributed to the increase in sales volume recorded by the flour mill.
He said that with return to profitability after years of losses, shareholders are encouraged that the board will recommend dividend payment in the coming years. He stated, “I want to commend you for this result. It clearly shows that this board is highly proactive and ready to tackle the problems of this company. You have significantly reduced the accumulated losses and reduced borrowings, I believe that under your leadership we should be able to receive dividends in the next couple of years.”
Executive Director, Sales & Marketing, Halima Dangote at the post-AGM interview attributed success recorded by Dangote Flour Mills in the current financial year to change in leadership and product innovation. She highlighted strategic and bold move by the company to grow its market equity in Africa by relaunching a new and improved pasta product, ‘Ecccellente’ with a great taste and in new pack. She said “The new improved and affordable pasta, is expected to reduce the dependency on rice consumption by Nigerians”
On the inability to pay dividends, Ighodalo said “Unfortunately, despite the good performance of the company in the current financial year, we are unable to recommend dividend payment because financial standards and regulatory considerations only allow payment of dividends from accumulated profits.”
Ighodalo however assured shareholders that the Board will continue to focus on sustaining high product quality, improving customer engagement strategies and strengthening supply chain capabilities.
“We will continue to work extremely hard to enhance the value of your investment in our company. With your unalloyed support, we look forward to consolidating on these gains in the coming year.”