Shareholders of May & Baker Nigeria Plc will receive a 233.3 per cent increase in cash dividend as the healthcare company sustained its improving performance with well-rounded growths in all kep performance indicators in 2017.
The board of directors of the company has recommended distribution of N196 million as cash dividend for the 2017 business year, representing a dividend per share of 20 kobo. The recommended dividend payout for 2017 represents an increase of 233.3 per cent on the payout for the 2016 business year. May & Baker had distributed N58.8 million as cash dividend for the 2016 business year, with shareholders receiving a dividend per share of 6.0 kobo.
Key extracts of the audited report and accounts of May & Baker Nigeria for the year ended December 31, 2017 released at the Nigerian Stock Exchange (NSE) showed that the healthcare company recorded significant growths in sales and profitability in 2017.
The report indicated impressive improvements in the underlying fundamentals of the company as well as the actual earnings figures. The top-down improvements in margins underlined the increasing efficiency of the company’s operations and management’s commitment to cost efficiency.
Group turnover rose by 10.39 per cent from N8.47 billion in 2016 to N9.35 billion in 2017. Gross profit grew by 29.13 per cent to N3.28 billion in 2017 as against N2.54 billion in 2016. Operating profit jumped by 51.04 per cent from N820.87 million to cross the billion Naira mark to N1.24 billion in 2017. Profit before tax leapt by 75.07 per cent from N345.94 million in 2016 to N605.62 million in 2017. After taxes, net profit stood at N370.87 million in 2017 compared with net loss after tax of N41.09 million recorded in 2016. Shareholders’ funds also rose by 10.3 per cent from N3.01 billion in 2016 to N3.32 billion in 2017.
All key underlying performance indicators showed considerable improvements, indicating increasing profitability of the company. Gross profit margin improved by more than five percentage points to 35.08 per cent in 2017 compared with 29.99 per cent in 2016. Operating margin-which indicates the profitability of the core operations of the company, rose from 9.69 per cent in 2016 to 13.26 per cent in 2017. Pre-tax profit margin-which underlines the profitability of the company, also increased from 4.09 per cent in 2016 to 6.48 per cent in 2017.
The management of the company attributed the performance of the company in 2017 to the success of management’s efforts to harness the potential of recent investments and reduce related costs.
According to the management, despite the macroeconomic challenges, the company’s sales growth has continued to improve considerably above industry average, showing continuing efforts to retain and grow market share.
Managing Director, May & Baker Nigeria Plc, Mr Nnamdi Okafor said that the improvement in margin validated management’s tight cost control measures and continuing efforts to harness synergies within the group to reduce costs and improve shareholders’ value.
“Our results show our main focus of satisfying our customer and enhancing our shareholders’ value. Our steady implementation of many growth initiatives are paying off as can be seen in the latest results. We are also happy that the investing public is taking note of these improvements with the performance of our stock as one of the best-performing stocks at the market,” Okafor said.
He noted that the recent inauguration of the board of Biovaccines Nigeria Limited has raised the prospects that the subsidiary will soon begin to impact positively on the group performance.
He pointed out that with the company’s world-class manufacturing facility in Ota, Ogun State, growing into a hub of pharmaceutical manufacturing in West Africa, the imminent commencement of operations by Biovacccines Nigeria Limited will open up a new vast vista of growth for the group.
Minister of Health, Prof. Isaac Adewole recently inaugurated the board of Biovaccines Nigeria Limited in Abuja. May & Baker Nigeria holds the majority equity stake of 51 per cent while the government holds 49 per cent equity stake in Biovaccines Nigeria Limited, the company set up for the purpose of May and Baker Nigeria-government partnership.
The Federal Executive Council had at its sitting on May 31, 2017 ratified a joint venture agreement (JVA) between the Federal Government and May & Baker for the formation of a private company, Biovaccines Nigeria Limited to serve as a special purpose vehicle for the production of vaccines in Nigeria.