May & Baker Recommends Dividend Despite Loss

As more companies release their results, May & Baker Nigeria Plc has recommended a dividend of N58.8 million for year ended December 31, 2016, which translates to six kobo per share.

Despite the tough operating environment in 2016, the healthcare group recorded a turnover of N8.47 billion, showing an increase of 12 per cent as against N7.57 billion in 2015. Distribution and marketing expenses dropped from N1.28 billion to N1.14 billion, administrative expenses increased from N587.3 million to N624.06 million. The group’s operating profit rose by 25.2 per cent from N655.80 million to N820.87 million, while profit jumped by 142.9 per cent from N142.40 million in 2015 to N345.94 million in 2016.

However, taxation surged by 420.5 per cent from N74.36 million in 2015 to N387.03 million in 2016. This displaced the net profit of N68.03 million in 2015 with net loss of N41.09 million. The huge tax expense resulted from a cumulative of back duty tax of N128 million, deferred tax charge of N208 million and current tax of N51 million.

In spite of the net loss of N41.09 million, the board of directors has recommended distribution of N58.8 million as cash dividend for the 2016 business year.

According to the Managing Director, May & Baker Nigeria Plc, Mr. Nnamdi Okafor, the group has continued to demonstrate resilience notwithstanding the tough macroeconomic environment that had constrained access to raw and production materials as well as poor purchasing power of consumers.

Okafor said in spite of the macroeconomic challenges, the company’s sales growth has been above industry average while the management has maintained efficient cost control to mitigate the effect of the macroeconomic headwinds on the bottom-line. He said this performance is driven by innovation, creativity and prudence.

He noted that while the com- pany’s manufacturing facility in Ota, Ogun State , is growing into a hub of pharmaceutical manufacturing in West Africa, the foreign exchange crisis that bedeviled the Nigerian economy in 2016 constrained access to raw materials and forced the group to operate the facility at about 50 per cent of its installed capacity.

“We are already looking ahead for better results in 2017 and beyond.