By Adedapo Adesanya
Following a run-of-the-mill performance in the year ended March 31, 2019, Flour Mills of Nigeria Plc is looking forward to drive profitability across its key segments in order to emerge stronger and better.
This was disclosed by the company’s Chairman, Mr John Coumantaros, at the company’s Annual General Meeting (AGM) on Wednesday, September 4, 2019 in Lagos.
Mr Coumantaros noted that following the previous period’s performance, the company was committed and determined to focus on strategies that will improve efficiency and synergy, while driving profitability in all key segments of the group.
Flour Mills, in the previous financial year, recorded drops in revenue, profit, and basic per earning shares indices. The poor performance was attributed to constraints caused by poor power and infrastructure, traffic, soaring input costs, and socio-economic circumstances.
However, the Chairman assured that the board recognizes the importance of improving ahead of the new financial year in progress, noting that the initiatives put in place had started yielding desired results.
“Our strategy to further restructure our balance sheet and optimize the financing costs achieved appreciable results with the significant reduction in net debt by N21.2 billion, while financing costs reduced by 30 percent (N9.8 billion) to N22.9 billion as at 31st March, 2019,” he said.
Accordingly, he also mentioned that working across the four main pillars of the company’s operations – Food Division, Sweetener Division, Agro-allied Division, and Support Services Division, the group was positioned to take the essential leap for continued growth and profitability.
In its food division, the key 5 value chains of grains; oils and fats; sweeteners; proteins and starches are to receive the necessary structure and support in bringing about share gain as imperative strategies has continued to strengthen the service delivery and implemented regionally differentiated plans and offerings.
Working on its innovation, Mr Coumantaros said the group has introduced new and exciting product focused on local content.
“These include the introduction of Golden Penny ‘Dawavita’ which is made from 100 percent natural, yellow Sorghum. Our consumers who are based in the northern part of Nigeria can now enjoy ‘Tuwon Dawa,’ a popular local staple.
“We also introduced Mai Kwabo Pasta and two new flour variants – Easy Bake and Classic flour,” he added.
‘In improving growth across its Sweetener Division through the Golden Sugar Company (GSC), Mr Coumantaros explained: “We introduced the GSC Operational excellence programme which is helping us reduce direct costs, raw material waste and chemical usage resulting in significant savings and employee engagement.”
Despite a drawback due to flood that resulted in damage of its cultivations, he assured that the company has recovered the land and fortified the channel effectively.
“I am happy to report that we have been able to recover the areas lost to the flood and a project to further strengthen our dyke by placing 300,000m3 additional material along 13km has also been completed,” he announced to shareholders present at the meeting yesterday.
Within its Agro-allied division, he assured that there had been significant structural changes along core business business functions disclosing that the agro-allied businesses of the company would now operate under a wholly-owned Agro-allied holding company.
“This was achieved through a Scheme of External restructuring between flour mills of Nigeria Plc and Golden Fertilizer Company Limited (GFC) where GFC emerged as the holding company for the agro-allied businesses and value chains,” Mr Coumantaros said.
The Chairman then assured shareholders that the manufacturing company has started exporting its Golden Penny Garri and High-Quality Cassava Flour (HQCF) to the United States of America and Europe.
“We are looking forward to build even further on this during the current financial year by creating more avenues for Nigerians in the diaspora to get access to our Garri, and equally provide a gluten-free flour alternative for those who are gluten intolerant,” he said.
He then assured shareholders that with the expansion, proper alignment and restructuring coupled with optimal operation of its supply chain put in place that the business would remain in a position of strength and continue to generate growth and create value for shareholders in the coming years.
