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Vitafoam shareholders unhappy over depletion of reserve

.Received N6bn loan in 5years, expends N5.5bn interest same period

Shareholders of Vitafoam Nigeria Plc have again charged the company’s board to deploy resources to generate more funds and return the group to profitability, to forestall completely deleting its reserve for dividend payment.

The company, as shareholders disclosed, received N6billion loan in five year and expended N5.5 billion in debt servicing same period, made a profit of N710 million in five years while a dividend of N2.88bn was paid in the past 12 years.

The charge was given on Thursday during the company’s Annual general meeting, during which he shareholders approved the 15 kobo dividend proposed by the board.

Te shareholders who spoke in turns maintained that for consecutive two years, Vitafoam has paid dividend to through funds from the reserves, even as they charged the board to leverage on the N2bilion loan recently received from the Bank of industry (BOI) and return to profitability and pay shareholders remarkable dividend of 50 kobo and above.

Mr. Nona Awoh, shareholders of the company while calling the company to brace up to the reality of the times , said that where the board fails to beef up the company’s performing indices, the likelihood of the company’s price trailing that some insurance companies at below 20 kobo may not be ruled out.

He said “irrespective of the N2 bn loan from the BOI, you need additional fund injection, it is important you recognize this”

He added that the N282 million unclaimed dividend recorded by the company is high as he urged the board to ensure that shareholders receive their dividend and the unclaimed taken by their rightful owners.

On his part, Sir Sunnyy Nwosu founder of the Independent Shareholders Association of Nigeria (ISAN), urged the company to end the era of expansion and commence consolidation and aggressive marketing o fits products t generate profit.

While urging the company not to allow the Vono brand to die or abandon the Ghana or Sierra Leone subsidiaries, Nwosu said “We can reduce exposure through subsidiaries and sell of part to the shareholders”

Earlier Chairman Vitafoam Plc, Dr Bamidele Makonjoula, had in his address to the shareholders assured that the company would deploy the borrowed funds from BOI judiciously and generate earnings to be ale to pay the 50 kobo dividend target raised by the shareholders.

Vitafoam Plc’s, results for the 12 months ended September 2017, showed that revenue increased by 30% from N13.5 bn in 2016 to N17.6 bn in 2017, profit before tax dropped from N61m in 2016 to N16 min 2017.

Vitafoam (the group) made another loss for the third consecutive year as it made a loss after tax of N127m. Vitafoam (the company) made a profit of N190 m– a 116% drop from the N412mit made in 2016.

 

 

 

 

 

 

 

Stories by Bonny Amadi

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