 |
|
|
 |
|
investor centre |
|
 |
| DIRECTORS REPORT |
The directors have pleasure in submitting to the members, the Consolidated Balance Sheet as at 31st December, 2006 together with the Consolidated Profit and Loss Accounts for the year ended on that date, showing a net consolidated profit of N3,204 million after providing for taxation of N1,074 million and the transfer of Minority Interest share of profits amounting to N482 million. The report also covered a review of the business performance in the last financial year as well as a look at future prospects. |
DIVIDEND
The Directors have recommended the payment of N1.00 dividend per 50k share for the year.
|
PROFIT FOR THE YEAR AFTER TAXATION |
2006 |
2005 |
|
N'000
|
N'000
|
Group profit for the year after taxation, minority interest and extraordinary items |
3,203,589 |
1,629,909 |
PRINCIPAL ACTIVITIES
UAC of Nigeria Plc is a diversified business with activities in the following principal sectors: Foods, Manufacturing, Automobile, Logistics and Real Estates.
|
CORPORATE GOVERNANCE
The Board is responsible for controlling and managing the business of the Company, keeping of proper books of accounts which disclose with reasonable accuracy from year to year, the financial position of the Company and ensuring their compliance with the provisions of the Companies and Allied Matters Act, CAP C20 Laws of the Federation of Nigeria , . It is also responsible for safe-guarding the assets of the Company by taking reasonable steps for the prevention and 2004 detection of fraud and other irregularities.
|
During the year under review, the Company was managed by a Board of ten members, made up of three executive directors and seven non-executive directors including the Chairman. It ensured the implementation of the Company's objectives through the following committees.
|
| 1. |
General Purposes Committee |
|
| |
Lt. Gen M I Wushishi (rtd) |
Chairman |
| |
Dr. J A Ajayi |
Member |
| |
Mr. O A Adetomiwa |
" |
| |
Mr. L E Ettah |
" |
| |
Chief S O Bolarinde |
" |
| |
Mr. V G Hammond |
" |
| |
Dr. N D Moyo |
" |
| |
|
|
| 2. |
Remuneration and Compensation Committees |
|
| |
Lt. Gen M I Wushishi |
Chairman |
| |
Dr. J A Ajayi |
Member |
| |
Senator U U Udoma |
" |
| |
Mr. V G Hammond |
" |
| |
Dr. N D Moyo |
" |
| |
Mr. L E Ettah |
Member /Secretary |
| |
|
|
|
The company has complied with the provisions of the Code of Best Practices on Corporate Governance in Nigeria (2003). |
DIRECTORS' INTERESTS
In Ordinary Shares |
|
December, 2006 |
December, 2005 |
Directors |
ordinary shares |
ordinary shares |
Lt. - Gen. M.I. Wushishi (rtd), CFR, GCON, FSS, PSC |
464,000 |
464,000 |
| Dr. J. A. Ajayi }direct |
3,166,622 |
2,000,000 |
}indirect |
3,020,650 |
3,020,650 |
Mr. O. A. Adetomiwa |
190,770 |
200,770 |
Chief S. O. Bolarinde |
474,090 |
474,090 |
Mr. L. E. Ettah |
131,250 |
131,250 |
Mr. V. G. Hammond |
2,878 |
2,878 |
Alhaji M. H. Koguna |
377,337 |
377,337 |
Mr. U. U. Udoma} direct |
838,052 |
838,052 |
}indirect |
9,325,180 |
9,325,180 |
| In Contracts |
|
|
Some of the directors have given notices for the purposes of Section 277 of the Companies and Allied Matters Act, CAP C20 Laws of the Federation of Nigeria , 2004, to the effect that they are members of some specified companies which could be regarded as interested in any contracts with which the group was involved during the year under review.
|
| CHARITABLE GIFTS AND OTHER DONATIONS |
N
|
Scholarships (Secondary Schools/Higher Education) |
13,850,000
|
Pan African University Project |
15,000,000
|
Other donations (N40,000 & below) |
293,480
|
Other donations (N40,000 & below) |
29,143,480 |
| THE COMPANY |
uac foods
The business unit recorded remarkable growth in both turnover and profitability in the snacks category. Alternative channel development was intensified with special focus on schools and neighbourhood shops to ensure spread and product availability. The food businesses of the company were restructured in September, 2006. This gave rise to the ice cream category being a division on its own and the central kitchen units of the former Mr. Biggs division becoming a part of the new UAC Foods.
The business unit finally exited the bread and drinks categories. |
uac dairies
UAC Dairies evolved as a stand alone business unit from UAC Foods on 1st September, 2006. The business achieved a growth of 15% in volume over 2005. UAC Dairies created excitement in the ice cream market through the launch of its Supreme Novelties (impulse range), making it the only current local player in the impulse ice cream market.
The tubs for the scoop range were upgraded to a more contemporary look. To boost its competitive stand, the business unit will pursue further extensions into other segments of the dairy market. |
uac franchising
uac franchising was established on the 1st of September, 2006 as part of the company's corporate restructuring exercise. The unit operates the franchising arm of the Quick Service Restaurant businesses. It is responsible for the marketing, IP development, sub-franchising, project engineering, site location and installation, brand and strategy development/management of the seven restaurant brands. …welcome to our world uac. The brands are Mr Biggs, Nando's, Village Kitchen, the Innscor brands - Luv Dat Chicken, Creamy Inn, Must Be the Pizza and Dial-a-delivery. |
mds logistics
The business unit had a good year, with an impressive performance that resulted in a significant increase in its operating profit over the preceding year.
During the year, MDS commissioned its fleet of brand new Montracon built 100m mega trailers, thus further ensconcing its foothold in the haulage industry.
In addition, MDS consolidated its pharmaceutical distribution framework. Telecoms distribution business also grew with the signing on of three key clients.
The business unit also undertook capacity expansion in some key locations, e.g. Onitsha , Aba and Oregun.
Growth potential remains high given the opportunities in the logistics landscape in Nigeria. |
mr. biggs
Mr. Bigg's, the largest Quick Service Restaurant (QSR) business in Nigeria , added 11 restaurants during the year thus increasing to 171 by the end of 2006.
To encourage local entrepreneurs, the business unit franchised some of its restaurants in the year while maintaining its high standard in quality, ambience and customer service.
”Village Kitchen”, the African meals brand, was introduced during the year to meet the demands of its valued customers for Native Meals of high quality in a friendly and cosy environment.
In the third quarter of the year, the company restructured its food business. This resulted in the emergence of UAC Restaurants, whose responsibility it is to operate all company's corporate QSR shops - Mr. Bigg's, Village Kitchen, Luv Dat Chicken, Creamy Inn, Pizza Inn, and Nando's brands under one business management. |
SUBSIDIARIES |
uac registrars
Registrars Limited, a wholly-owned subsidiary of uac nigeria plc, is duly registered by the Securities and Excshange Commission to perform as Capital Market Registrars. As a securities registration outfit with a proven track record, the company is now poised to explore the opportunities that abound in the share registration market and has formulated its strategies towards making a mark in its chosen market.
It is fully automated with state-of-the-art share registration/data management software and computer equipment, (X-TRAC), which is adjudged the best in the industry.
The clientele cuts across the manufacturing and service industries. |
GM NIGERIA LIMITED
The business recorded growth in turnover and operational profit; as it continued intensification of its distribution network and customer service.
During the year, the company redefined its operations as a result of government's introduction of Common ECOWAS Duty Tariffs (CET), which reduced the duty on CKD to 10% from 30%, which made the importation of CKD unattractive. As a result, the company started importation of completely built vehicles.
The restructured business unit operations have led to the relocation of the head office from Apapa to the Oregun Industrial Area. |
CAP PLC
CAP PLC continued to play a leadership role in the paints and chemicals sector with significant growth in turnover, operational profit and cash flow.
CAP PLC introduced the 2006 Colour of the Year with fanfare and proceeded to launch additional Dulux Colour Centres in Lekki, Abuja and Ikeja.
The company was rewarded with the Nigerian Stock Exchange and Pearl awards for sectoral leadership. |
SPRING WATERS NIGERIA LIMITED
The business grew in turnover in spite of very tough competitive environment in the bottled water market.
The company concluded its restructuring exercise which resulted in substantial reduction of its debt profile and finance charges.
Consequent upon the strategies put in place last year aimed at assuring sustained future growth of the company, SWAN Soft Drinks product range was introduced into the market in December 2006. The SWAN Soft drinks range, which is specially blended to “surprise your thirst”, comes in three exciting flavours of Orange , Pineapple and Apple. This new addition to the stable of the company has potential in its market segment as it has been well accepted by consumers. |
GRAND CEREALS & OIL MILLS LIMITED
Performance of the business unit dipped due to the outbreak of Avian Influenza in February 2006. The volume of Feed business which accounts for about 60% of the company's entire business plummeted. This resulted in high stock holding and interest charges. The sales of Feeds, however, witnessed a promising recovery in November and December. It is hoped that this will be sustained.
Similarly, the Cereal segment of the business also suffered because of maize glut, a consequence of Avian Influenza. Self and toll millers capitalized on the low price of maize to increase their milling activities. This resulted in reduced demand for cereals - based morsel foods.
For the Oil business, the tactical alliance with a vegetable oil company for refining and packing Grand Pure Soya Oil helped to increase volume during the festivities season in December. |
WARM SPRING WATERS NIGERIA LIMITED
The business made significant improvements and growth in turnover during the year in the very competitive bottled water market. It also recorded improvements in the efficiency of its operations. There was still no sufficient volume to break even.
There was better penetration and visibility of the Gossy brand in the market place as Gossy became available in several cities across the country. The brand is beginning to gain the much desired critical mass with reasonable growth in volumes.
The strategic thrust is to build on its relative success by repositioning the brand and deploying superior marketing communication to create demand and more awareness. With planned improvements in its distribution strategy, the company is positioned for a better performance in the coming year. |
DISTRIBUTORS/CUSTOMERS
Some of our goods and services are handled by distributors. These distributors are appointed solely on the level of business they can make and the degree of support services they can provide to customers. Distributors and clients are spread across the length and breadth of the country.
|
EMPLOYMENT POLICY AND EMPLOYEE WELFARE, HEALTH AND SAFETY |
It is the policy of the group that there is no discrimination in the employment, training and career development of all categories of people including disabled persons. The health and welfare of the work-force are prime in all our activities. Employees enjoy free medical services at the Group Clinics located in Lagos Island , Apapa, Oregun, Ojota, Kano , Kaduna , Jos , Benin , Warri, Aba , Port Harcourt and made with recognised hospitals as retainers to provide medical attention to employees in locations where we have no clinics. It is also our policy to ensure that our work environment is safe and clean. Towards this end, the group enforces strict adherence to safety rules and practices through its Safety Committees in various locations. Safety and Fire Drills are regularly organised to keep employees alert at all times. Heavily subsidised canteen services are provided while recreational facilities and staff clubs are available in various parts of the country.
|
EMPLOYEE INVOLVEMENT AND TRAINING
Regular routine meetings are put in place to ensure exchange of ideas between staff and management through Joint Consultative Committees, Briefing Sessions and Company Council Meetings. Team briefing approach is adopted in some areas and Communication Audit has been embarked upon to stimulate and monitor the level of employee awareness on matters of concern to them.
Our policy recognises human resources as the most important asset of the organisation. It is, therefore, imperative to retain and motivate skilled work force through systematic training and development. Consequently, training forms part of individual development towards achieving excellence in performance of day-to-day activities. We have a Training/Seminar Centre at Apapa.
Various in-house courses are also supplemented by external courses for employees within and outside Nigeria .
We encourage self-development schemes which enable employees to improve themselves academically and professionally in their chosen careers. individual development towards achieving excellence in performance of day-to-day activities. We have a Training/Seminar Centre at Apapa. |
|
|
 |
|
