May & Baker posts N609.94m profit in nine months
May & Baker Plc has recorded profit before tax of N609.94 million in its nine months operations, against N322.39 million recorded in corresponding period in 2017.
The company’s nine-month performance for the period ended September 30, 2018 submitted at the Nigerian Stock Exchange (NSE), showed that Profit after tax from continuing operations also rose by 89.82 per cent from N218.505 million to N414.76 million.
With the addition of net profit of N329.57 million from discontinued operation, total net comprehensive income grew by 240.65 per cent to N744.33 million in 2018 against N218.505 million in 2017.
However, turnover dropped marginally by 5.63 per cent from N6.93 billion to N6.54 billion. The company had during the period divested and sold its noodles business, as part of its strategic focus on its core healthcare business.
Earnings per share, based on continuing operations, increased by 89.78 per cent from 22.30 kobo in 2017 to 42.32 kobo in 2018.
On the basis of total net comprehensive income, earnings per share jumped by 240.58 per cent to 75.95 kobo in third quarter 2018 as against 22.30 kobo in third quarter (Q3) 2017.
The continuing strong bottom-line performance places May & Baker on a stronger footing to sustain its recent dividend payment record, as it had in 2017, increased cash dividend by 233.3 per cent to 20 kobo per share compared with 6.0 kobo per share paid in 2016.
The bottom-line position makes the ongoing rights issue attractive with possible dividend yield of eight per cent within less than four months.
The company is raising N2.45 billion in new equity funds through a rights issue to existing shareholders, and is offering 980 million ordinary shares of 50 kobo each at N2.50 per share to existing shareholders.
The rights issue has been provisionally pre-allotted on the basis of one new ordinary share for every one ordinary share held as at the close of business on Tuesday, September 4, 2018.
Application list opened on Monday October 22, and will close on Wednesday November 28.
Capital Assets Limited, and Compass Investments & Securities Limited, are the stockbrokers to the rights issue, while Cordros Capital Limited, and Afrinvest (West Africa) Limited, are the issuing houses.
The Managing Director, May & Baker, Nnamdi Okafor, said the Q3 performance showed that its strategic focus and investments have continued to yield gains for the shareholders.
He noted that the ongoing rights issue would further reduce finance costs, increase capacity, and bring greater returns to shareholders, urging shareholders to pick up their rights to realise the benefits of their patience and support for the company over the investment years.
He further said the company would pay dividend on the new ordinary shares to be issued through the rights issue, despite the fact that the proceeds of the rights issue will not impact on the business this year, as the net proceeds will be received towards the end of current business year.
“Our results in the past four years show we are increasingly becoming stronger, and our performance curve is firmly on the upside. The results show the inherent value in our company, and with the investments we had made in recent years and new investments underway, our shareholders can only expect continuing improvement,” Okafor said.