Accounts
2002

Financial Highlights | Chairman's Statement | Profit and Loss Account | Balance Sheet | Cash Flow Statement | Five-Year Financial Summary | More Information

Financial Highlights

Year ended December, 2002

Chairman's Statement

From the 39th Annual General Meeting - 18th July, 2003

Distinguished Shareholders, Ladies and Gentlemen,

I am pleased to welcome you all to the 39th Annual General Meeting of our Company and to present to you the Annual Report and Accounts for the year ended 31 December 2002. In order to appreciate the results, I shall dwell briefly on the business and political environment under which we operated.

The Business and Political Environment

The lingering disagreement between the Federal Executive and the Federal Legislature, characterized by the delay in approving and implementing the budget, set the tone for the operating environment in 2002, characterised largely by increased costs of doing business. Delays in release of funds by the Federal Government, kept interest rates high until towards the end of the year. The introduction of the Dutch Auction Foreign Exchange System systematically led to a gradual devaluation of the Naira. Unfortunately, also, initial improvements in public infrastructure such as electricity fell back significantly. The increase in fuel prices arising from scarcity increased the cost of doing business. the national road network, critical for distribution of goods continued to deteriorate.

Despite the foregoing, the Federal Government is to be commended for its efforts to create a liberal market oriented economy, driven largely by the private sector. the ongoing privatization process has recorded several successes, not least of all in telecommunications. The liberalisation of this sector has manifested itself in higher efficiencies, improved service deliveries and tremendous growth in job creation, directly and indirectly.

The Federal Government is also to be commended for its unequivocal support and backing for NAFDAC in its efforts to sanitise the food and drug industry. The entire Pharmaceutical industry has benefited considerably from the reduction in influx of substandard and counterfeit products, and owe the Director General and all members of NAFDAC a debt of gratitude for discharging their responsibilities without compromise and setting new standards for public office probity.

2002 Performance

Operating under the foregoing environment, the Company in 2002 recorded a turnover of N1,439,659,000 up from N977,168,000 or 47% over the previous year. Profit before Tax was N95,090,00 up from N39,336,000 the previous year, a growth of 142%. Improvement in our operating performance reflects the successful implementation of our strategic decision to divest our activities in the Industrial Chemical Division, and to reinvest resources hitherto tied up in the Division on growing  the potential of our higher margin Pharmaceutical Division.

Outlook for 2002 & Beyond

It is our hope that the re-elections in 2003 and installation of a democratic government with a fresh mandate will build on the stability we expect and provide a stronger platform for further economic expansion. It is apparent that increased economic well-being will create a virtuous cycle for more stable politics and government.

Within NGC, we are committed to driving business growth by investing in replacement and new capacity, up-dating our IT systems, improving practices, developing skills and strengthening our operations. Bearing in mind the price-elasticity of our products, the enhancement of our operating efficiency is of paramount importance to us. Our measurement of success in this regard is our level of borrowings, and consequent interest expense, which we are committed to reducing.

Dividend Policy

Based on the results for the year, and following several years in which cash dividends were regrettably not available for distribution, the Board is pleased to recommend a dividend payment of 20 Kobo per share, amounting to N30.7m. In setting this level of dividend, we have taken into account the Company's improvement in profitability as well as the need to retain adequate resources within the business to support our growth plans and for the long term financial stability of the Company.

Changes to the Board

During the year, we received notification of the retirement of Alhaji (Dr). M. Aba Aji, following his retirement as Managing Director of NSITF. We wish him every success in his endeavours as an elected member of the Federal Senate. We subsequently received a request from NSITF to replace Alhaji Aba Aji with Alhaji A. R. Mohammed, the incumbent Managing Director. Rufa'i Mohammed is a seasoned accountant and administrator with over 27 years experience in both the private and public sectors. He has been Secretary to Kano State Housing Board, Chief Accountant/Company Secretary of Kano Textile Printers Ltd., Finance Controller, Kano State Investment and Property Company, Director (Finance & Investment) Kano Foundation and was the General Manager (Investment & Treasury Management)/ Special Assistant to the Managing Director/CE of Nigeria Social Insurance Trust Fund (NSITF) before he was appointed the Managing Director/CE. We have no doubt that the Company shall benefit from his wise counsel and contributions. Subject to your ratification of his appointment, we wish him every success during his tenure on this Board.

Management and Staff Matters

The good result for the year reflects largely the sustained effort, loyalty and commitment of the management team and staff. Their willingness to improve individual and team skills and to use those skills in driving the Company's objectives are commendable, and I am sure you have no objection to my extending our appreciation on your behalf to them.

Conclusion

In conclusion, let me express my gratitude to all the shareholders for their continued support. The Company remains fundamentally sound, with a very strong asset base, essential to safeguard sustained long-term growth and development. I conclude by reaffirming my confidence that long term shareholder value and returns are assured.

Thank you for your attention.

Abali Muhammadu – Emir of Fika
Chairman

Profit and Loss Account

Year ended December 31, 2002

Balance Sheet

At December 31, 2002

Cash Flow Statement

Year ended December 31, 2002

Five-Year Financial Summary

Year ended December 31,

More Information

For more information on our accounts, please contact our company secretary for a copy of our ANNUAL REPORT - contact details »»