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Multiverse Leverages Expansion to Enhance Shareholders’ Value

23 Jan 2013

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With multiple income expected from its expansion drive, shareholders of Multiverse Plc may soon forget their years of woes, writes

Eromosele Abiodun
Incorporated on 20th June, 2002, Multiverse Resources Plc was listed by introduction on the floor of the Nigeria Stock Exchange (NSE) on October 8, 2008 after a successful private placement. Since its listing, the company’s shareholders have had nothing to cheer about as its share price has remained at 50 kobo. Also, the company has been unable to reward its shareholders with dividends due to its efforts to grow its business.

Shareholders Assured
However, the company has assured its investors of good returns on their investments in the coming years following huge expectations from its several expansions in the last several years.


Speaking at the company’s Annual General Meeting (AGM) in Lagos recently, Managing Director/Chief Executive Officer of Multiverse, Mr. Ayedun Fasina, noted that the bright prospects in the solid minerals industry coupled with its investment in strategic operations would ensure increased return on investments for shareholders.


He noted that Multiverse had expanded its operations into the mining of solid minerals adding that it would be focusing on lead ore, barite and copper ore.


Speaking on the future prospects of the business, Fasina noted that barite ore was very critical to the operation of the oil industry noting however its availability in Nigeria, oil companies were importing it because it was not being mined locally.


He also explained that the company had also acquired lead and barite site at Adudu and Azara both in Nassarawa State adding that, soon, the impact of its investments would be seen in the performance of the company.


He said: “What we have is gold. The product we are into guarantees income. We already have 4 million metric tons per annum granite site and we decided to diversify into minerals such as barite and lead ore because we have the expertise and equipment to pioneer the business in that sector.”


“We have moved in to fill that vacuum by mining the barite ore and other minerals and make them available to operators in the oil industries. Your company is worth N4 billion in assets and that is huge. It is only that the business we are into has a gestation period but I assure you that the future is very bright, “he assured.

Mining Licence
Towards the end of the 2012 financial year, Multiverse Plc notified the NSE that it had received approval from the Federal Government of Nigeria for a mining licence to commence mining operations in Nigeria. The mining licence covers 14 cadastre units within the company’s exploration licence 3187 and is subjected to renewal over a 25-year period.


The mining licence was granted to the company after an extensive exploration exercise and geographical study that confirmed economic quantity of Lead/Zinc Ore in the Mining Area.


The company said the licence approval represented significant milestone in its quest to position itself as a leading mining outfit in Nigeria.
“It prospects that this will lead to a sustained and world class Returns on Investment (ROI) for our shareholders in the medium and long term,” Multiverse said.


The company believes the expansion of its operation into the mining of solid minerals will deliver high returns to shareholders in the nearest future.


“Multiverse, a leader in the production of granite stones, has expanded into the solid minerals mining with focus on Lead Ore, Barite Ore and Copper Ore. Our core business line spans through exploring, extracting, prospecting, boring refining and drilling for producing and quarry mining of stones and rocks into different configuration and classification especially granite chipping and stone dust, “the company said.


Director-General of the Nigerian Mining Cadastre, Mr. Mohammed Amate, said the award of the licence to the company attested to the fact that the firm had qualified both technically and financially and had met the minimum requirements by law to be issued mining leases.

Principal Activities
The company has over 5,000 shareholders with its shareholders funds in excess of N3.5 billion. The company specialises in solid minerals with specific focus on mining of lead ore, barite ore, copper ore and granite chippings for construction.
Its philosophy reflects a deep rooted belief that value is created through focusing on a few uncompromising fundamentals namely -solid management, operational excellence, optimised capital structures and sound long term strategic and business objectives.


In year 2005, the company commenced granite quarrying operation in its first site at Oloparun, Obafemi Village, Ogun State with installed capacity of 600,000 tons per annum, which was upgraded by the addition of another production line, in 2007, with production capacity of 400,000 tons per annum making the site installed capacity to 1 million tons per annum.


Since 2008, it has been actively involved in its core areas of businesses developing and deepening its operations.
In 2009, full operations commenced at its second site at Km 14 Alaguntan Village, Abeokuta-Ajebo Road, Ogun State, with an installed capacity of 1.2 million metric tonnes per annum, bringing the company’s total installed capacity to 2.2 million metric tonnes for the two sites in Ogun State.


Financials
An analysis of the company’s financial statement showed that it recorded a turnover of N660.06 million for the year ended December 31 2011, indicating an increase of 16.84 per cent over N564.91 million in the corresponding period of 2010.
Profit before tax (PBT) dipped by 36 per cent to N29.26 million from N45.7 million in 2010. Also, profit after tax (PAT) declined by 40.6 per cent to N25.56 million from N43.10 million in the corresponding period of 2010.


Its balance sheet recorded an improvement as the company's fixed assets went up by 1.8 per cent to close the year at N3.866 billion from N3.796 billion the previous year. Its total current assets moved up by 8.16 per cent from N574 million in 2010 to N620.91 million in 2011. The company's shareholders fund grew by 0.69 per cent to N3.724 billion from N3.698 in 2010.


Total assets swelled by 12.68 per cent to N5.022 billion from N4.457 billion in 2010. Its net asset per share remained constant at 0.870 kobo. It recorded an improvement in its cash flow activity as its net cash inflow/(outflow) from operating activities went up by 198.60 per cent to N348.67 million from N116.76 million in 2010.


Corporate Governance
Multiverse adheres strictly to the Code of Corporate Governance issued by the Securities and Exchange Commission (SEC). This ensures highest standards of transparency, accountability and good governance. It has also taken several initiatives to benchmark its governance system with best practices globally. The company is governed by a framework that defines the rights, roles and responsibilities of all stakeholders. This facilitates all necessary checks, balances and incentives a company needs to manage the various stakeholders.

Tags: Nigeria, Business, Featured, Multiverse Leverages, Shareholders

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