Shareholders recapitalise underwriting firm with N3.3billion
The approval to raise N3.3billion capital through right issue was given during Goldlink’s 20th Annual General Meeting (AGM), for the financial year ended December 31, 2015, at the weekend in Lagos.
This comes after about seven years of regulatory intervention in the company by the National Insurance Commission (NAICOM), as a result of breakdown in acceptable corporate governance practices.
Goldlink is also waiting for the withdrawal of NAICOM’s intervention, to enable it begin business on a clean slate.
Presenting the report to shareholders, the Chairman, Mohammed Bintude, recalled that members of the Interim Management Board (IMB), were not constituted during the period of this report.
He said while the arrangements for the commencement of the statutory audit for 2015 were yet to be concluded, NAICOM, on February 25, 2016, reconstituted the current Board of which he became the chairman.
“Broadly, our mandates include among others, to chart a way for the company’s needed recapitalisation and general repositioning for better business performance.
“Year 2015 was an election year in the country which witnessed a trail-blazing and successful transition from one political party to another at the federal level, in her journey of democratisation. This remarkable development was however overshadowed by other global and macro-economic developments all of which combined to make the year a tumultuous one.
“The company made efforts to sustain her market share, but could not, owing to the impact of the same issues already highlighted above, and her current peculiar circumstances,” he said.
On the financial position of the firm, gross premium written fell by 32 per cent from N3.7billion in 2014 to N2.5billion in the current year. The loss before tax however improved marginally from N415million to N409million, a difference of one per cent.
The company gained some tax reversals, which impacted on the loss after tax, reversing the after tax loss of N529million achieved in 2014, to N350million in 2015, a difference of 33 per cent.
“Over the same period, the total assets of the company fell from N2.1billion in 2014 to Nl.8billion in 2015, largely contributed by reduction in reinsurance assets and trade receivables.
“As daunting as the performance appears, it is a reflection partly of the state of the uncertainty in the national economy and the peculiar circumstances of the company itself at the time. It is noteworthy however that the key to achieving a complete turnaround include the recapitalisation of the company, a process which this Board has made remarkable and tremendous progress,” he added.
During a pre-AGM session with reporters, the interim Managing Director, Mrs Funke Moore, said: “It is a matter of public knowledge that the company has been under NAICOM’s regulatory intervention since the last quarter of 2012 due to the regulator’s observed breakdown of acceptable corporate governance practice(s) in the company’s management.
“Upon the successful presentation of the company’s financial statements for the years 2011 to 2014 at the company’s 19th AGM in December, 2015, the first Interim Management Board constituted by the NAICOM was dissolved in February, 2016 and reconstituted as it is presently with the core mandate to; perform the normal duties of the Board and take such actions as may be considered necessary for the sound management and growth of the company within the scope of existing policies and practices; and carry out all other things that may be necessary to bring the company to sound management operation and stability.”
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