Livestock Feeds Plc has commenced the process of raising additional capital to boost its operations. Shareholders of the company had last year approved that about N2 billion should be raised through a rights issue.
Speaking at the annual general meeting (AGM) of the company in Lagos yesterday, Chairman of Livestock Feeds Plc, Mr. Larry Ettah said the company had begun the implementation of the approval.
“Distinguished shareholders, at the last AGM of our company, you gave approval to the directors to raise additional capital by way of a Rights Issue to enhance the working capital and expansion needs of the company. I am happy to inform you that the process for implementing this has commenced as approvals are presently being sought from the regulatory authorities, the whole exercise is expected to be completed within this year.
He also disclosed that the installation of full fat extrusion plant for the processing of soya beans at the company’s Ikeja factory which commenced at the tail end of 2015 has been completed.
“This will ensure the ready supply of one of our major materials to all our locations and also as an avenue for product portfolio expansion. As the year progresses, your company is poised to leverage on improved supply efficiency, develop technical collaborations, enhance operational efficiency, deepen market development to reach the unreached and launch innovative products to enhance our business fortune,” he said.
Ettah said the company, which is a subsidiary of UAC of Nigeria Plc, recorded revenue of N8.9 billion and profit before tax of N300 million for the year ended December 31, 2015.
He said due to need to conserve funds the directors did not recommend any dividend, as against 10 kobo dividend paid the previous year.
“You will recall that your company paid a dividend of N0.10 per share on the 2014 results after several years of non-payment of dividend. This was done to reward shareholders for their steadfastness in keeping faith with the company through the lean years. However, in view of the 2015 results and the need to conserve funds to fund the growth plans and working capital of the Company in 2016, the board has not recommended payment of a dividend for your approval. We are hopeful that dividend payment will resume shortly,” Ettah said.
He added that the company is restructuring its operations for an improved performance against the backdrop of an extremely challenging economic and business environment.
The chairman feed milling industry encountered acute shortage of the major raw materials of maize and soya bean meal, saying the prices of these products increased by 40 per cent in the course of the year, leading to increased cost.