Shareholders authorize FTN Cocoa directors to raise N1.4bn capital.

The shareholders of FTN Cocoa Processors Plc have given their consent to a proposed plan by the directors of the company to raise a capital of up to N1.4 billion, subject to regulatory approval. This is part of the resolutions reached during the recently concluded Extra-Ordinary General Meeting of the company.

Affirming this, a notice signed by one of the directors of the company, Mr Akin Laoye, and made available on the website of the Nigerian Exchange Limited (NGX) read: ‘’Subject to obtaining the approval of the relevant regulatory authorities, the Board of directors of the Company (the “Board”) be and is hereby authorized to raise capital of up to ₦1,400,000,000 (One Billion Four Hundred Million Naira), on such terms and conditions and at such time, as the Board may deem fit or determine (“the Capital Raise”).’’

According to the disclosure, the capital is to be raised through the combinations of different strategic means, such as; private placement, rights issue, public offering etc. Subject to regulatory approval, the notice stated that;

  • The Board will offer shares to its shareholders via a rights issue or any other method approved by the relevant regulatory authorities, in compliance with CAMA 2020.
  • The Board will apply amounts outstanding under any convertible loan, shareholder loan or other loan facility due to any person, from the Company, as may be agreed between the person and the Company, towards payment for any shares to be subscribed for and allotted to such person under the rights issue or any other method approved by the relevant regulatory authorities for the offer to the shareholders.
  • In a bid to liquidate some of its debt to OH Origins Global Commodities Inc., the firm stated that it will allot shares outstanding from the Capital Raise to the latter on a basis of private placement / debt to equity conversion. The deal will be executed at a price not below the one offered to the shareholders and on such terms and conditions approved by the Board.
  • Perhaps the entire capital is not raised by the shareholders and by OH Origins, the Board is at liberty to raise the outstanding capital by way of public offering or any other method(s) or combination of methods such as; issuance of shares, convertible or non-convertible securities, loan notes etc.
  • The Board was also charged to exercise its legitimate powers in carrying out actions that will bring the plans into fruition, including but not limited to hiring professional advisers, execute agreements, deeds, notices and other transaction documents, among others.

Back story: Nairametrics had earlier detailed the adverse financial conditions of FTN Cocoa Processors Plc and the efforts it had taken to correct the anomaly. According to the report, the company had been facing financial setbacks since 2014.

True to the observation, the company also reported a half year loss of N689.7 million in its recently released unaudited financial statements for the Half Year period ended June 30, 2021. To this end, the recent approval to raise N1.4billion is a right step towards the right direction with a lot of multiplier impact that can return the company back to its profit ways.

FTN Cocoa Processors Plc closed trading today 12th of August, 2021 with a share price of 40 kobo.

Ellah Lakes Plc appoints Robert Grant as Chief Financial Officer

Ellah Lakes Plc has announced the appointment of Mr Robert Grant as its Chief Financial Officer (CFO), effective from 1st of September, 2021.

The appointment was announced in a notice sent to the Nigerian Exchange Limited (NGX) today which reads: ‘’ Ellah Lakes Plc. (“Ellah Lakes”, or “the Company”) is pleased to announce the appointment of Mr. Robert Grant as the Chief Financial Officer (CFO) of the Company.’

Robert Grant has over 20 years of investment banking and consulting experience and is currently the Head of Infrastructure Financing at First City Monument Bank. He joined FCMB Capital Markets as a Vice President in 2012 having previously spent 5 years at First City Monument Bank Limited. Prior to that, he was the acting CFO of Ghana Telecom from 2003 to 2006 and he was a director at Lucent Technologies between 1999 and 2002 and a Vice President at TD Securities from 1995 to 1999. He has been a team leader on the successful execution of numerous project and structured finance deals in the power, oil & gas and telecommunications sectors.

Robert holds an MBA from New York University’s Stern School of Business, New York, NY and a B.Sc.Accounting from Hayward State University, Hayward, CA.

Commenting on the recent development, the Chief Executive Officer/Managing Director of Ellah Lakes Plc, Mr. Chuka Mordi said: ‘’We are extremely pleased to have such a seasoned professional like Robert Grant joining our team, and we are very excited at the wealth of experience and capacity that we now have at our disposal, for the next stage of growth at Ellah Lakes Plc

What you should know:

  • Ellah Lakes is a diversified Nigerian agribusiness operator with focus on production of oil palm, cassava, maize, soya bean and their derivative products. The firm was established in 1980 and is currently listed on the mainboard of the Nigerian Exchange Limited (NGX).
  • The firm closed trading today 9th of August, 2021 with a share price of N4.25

2020 FY results: Presco Plc post 83% growth in profits

Presco Plc released its 2020 unaudited FY results

  • Revenue of N23.91 billion vs N19.72 billion +21.22% YoY
  • Operating Profits N10.48 billion vs N8.1 billion, 28.4% YoY.
  • Profit after tax of N7.03 billion vs N3.83 billion a year earlier. +83.25% cut YoY.
  • Earnings per share of 703 kobo vs 374 kobo earnings per share reported in 2019. +87.97% YoY.
  • No dividend announcement was made in their press release.
  • The company share price of N74.50, up 5% YTD.

Bottom Line: This was a decent result, however, Presco’s price-earnings ratio of 14x is a tad expensive. Agric stocks tend to be expensive as Okomu oil is also priced at 13x earnings.

See link to results.

FTN Cocoa facing imminent insolvency

FTN Cocoa released its 2020 full-year earnings revealing a loss after tax of N664 million (2019: N797.1 million). Earning per share for the period under review printed at 30kobo per share (2019: 36 kobo).

Key Highlights

  • The company is facing imminent insolvency after losses widened its negative equity to N1.1 billion up from N499.2 billion.
  • This means the company status as a going concern is threatened as it could close shop any time soon.
  • The company also acknowledged this threat explaining that “the company incurred an accumulated loss of N4,705.585 million as at the year ended 31 December 2020. At that date, the company had a negative shareholders fund of N1,163.286 million. This condition gives rise to a material uncertainty which may cast doubt on the company‟s ability to continue as a going concern.”
  • It then assured of a fundraising exercise that could resuscitate the company. “However there is an ongoing capital restructure
    programme which will bring in substantial foreign capital inflow to reposition the company.”
  • The company has a cash balance of just N48. 4 million

What FTN Cocoa does: The company is into the processing of cocoa beans and palm kernel into Cocoa Cake, Liquor, Butter, Powder, Palm Kernel Oil, and Palm Kernel cake. Cocoa Cake, Liquor, and butter are exported while Cocoa powder, Palm Kernel oil and Palm Kernel cakes are marketed locally to manufacturing companies.

See results