Following the recent successful acquisition of majority shares in Dangote Flour Plc, shareholders of the company are poised to take a resolution during its annual general meeting (AGM) on Friday (today) to effect a name change.
If the proposal by the Chairman of the company, Aliko Dangote, to the shareholders is approved by the Board of Directors during the meeting, scheduled for Calabar, Cross River State, the company’s name would henceforth be Tiger Branded Consumer Goods Plc.
In a statement on Thursday, Mr. Dangote lamented the decline in the company’s fortune in 2014, culminating in net operating loss after tax of over N6.3 billion.
Describing the year as difficult, the Chairman said it was shaped largely by several challenges, including security concerns and declining margins as a result of over-capacity, which affected the company’s overall performance.
Although the company’s turnover of N41.3 billion showed a 3.3% growth over 2013 performance, its operating loss before abnormal items dropped to N4.8 billion.
The decline was attributed to continued pressure on company margins as a result of stiff competition in the industry.
Abnormal items valued at over N1.6 billion was associated with the impairment of excess production capacity in its Apapa, Ikorodu and Calabar mills.
During the year, divisional performances recorded similar negative trends, with Pasta division showing a dip in sales turnover against the previous year’s figures, due to the company’s focus on quality improvements and operational efficiency towards future improved performance.
The Noodles division also witnessed decline in sales volume by 4.3 per cent, despite the introduction of new product offerings, robust route to the market and improved marketing.
Its primary line of production, flour, was, however, the only division that witnessed increased sales volumes by 6.7 per cent, while cost of sales dropped by 5.1 per cent, resulting in a gross profit of N2.4 billion, despite a slowdown in sales in the first quarter of the year due to price adjustments in the industry.
Mr. Dangote expressed optimism that the company would maintain the progress it has recorded in stabilising its delivery platform as well as optimising infrastructure, particularly in its Kano Flour Mills, in order to boost capacity utilisation and optimise cost.
“For the future, the company will focus on completing the optimisation of its business infrastructure and re-tuning of its business model towards improving on the predictability of its earnings and margins,” he said.