Sokoto Cement explains non-payment of dividend to shareholders
• Declares N1.3bn profit after tax in 2016
The challenges of infrastructure decay and the burden of retooling have been identified as the major impediment against the declaration of dividend for shareholders by the Board of the Cement Company of Northern Nigeria (CCNN) Plc.
Such decayed equipment include worn-out generators, cooler tubes and kiln shell, which require huge investments for their replacement or repairs, thereby eating deep into the company’s profit.
The Chairman, CCNN, Abdulsamad Rabiu, who gave the explanation at the company’s 2016 Annual General Meeting, said as a result, “The Board resolved not to recommend the payment of any dividend this year … to ensure the long term survival of the company.”
Regardless of the non-declaration of dividend, Rabiu disclosed that the cement company made about N1.254billion profit after tax in 2016 or four per cent increase against the N1.2billion recorded in 2015 financial year.
Similarly, turnover rose by eight per cent to N14.1billion in 2016 from N13.04billion in 2015.He further disclosed that cement production in 2016 was 485,799 tonnes representing 23 per cent increase over the 395,438 tonnes achieved in 2015, while quantity sold stood at 488,495 tonnes or 21 per cent above the 404,377 tonnes sold in the corresponding periods of 2016 and 2015 respectively.
In his assessment of the operating environment vis-a-vis the company’s performance, Rabiu noted that low prices of cement particularly since the third quarter of 2015, continued through to August 2016, which seriously affected its performance.
This notwithstanding, the Chairman promised that the Board and management would continue to ensure strict cost efficiency regime in turning the company around in order to promote strong shareholder value.
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