BY FESTUS OKOROMADU
Directors of Industrial & Medical Gas Plc seem to have found a noble way of sourcing foreign currency for its operations as the challenge of doing so in the open market appears to have become critical.
The company said the new core investor, Rtd. Gen. Theophilus Danjuma, owner of TY Holdings, availed it the equivalent of N1.6 billion in foreign currency to enable it operate without the usual difficulties during the 2022 financial year.
This is contained in the audited account and financial statements for the year ended December 31, 2022 of the company, released last week.
In August 2021, TY Holdings Limited, acquired majority shares of the company through the purchase of 60 percent shareholding of BOC Holding Limited, UK the hitherto core investor, to increase its shareholding to 72 percent in Industrial & Medical Gas.
Disclosing the company’s dealings with related parties as part of adherence to corporate governance ethics, the Directors said during the year under review, they have to depend on Danjuma to help raise the needed forex.
“As part of its expansion plan, the company needed foreign currency to procure equipment. Due to scarcity of forex, the company approached a related party, TY Danjuma, to assist the company to source for dollars from within his business network.
“The Board approved the decision in December 2022 and the fund was paid for the transaction. The currency of settlement is US dollars, and the rate is to be determined at spot rate on the future date when the currency is sourced. As at 31 December 2022, the equivalent foreign currency is being expected, hence this has been presented as related party receivable in the financial statement for the year ended 31 December 2022.
“Subsequent to year end and as at the date the Board approved this report, the transaction has been concluded and the currency of settlement was paid to the Company in line with the agreed terms.
“All outstanding balances with these related parties are to be settled in cash within twelve months of the reporting date. None of the balances are secured nor bear interest.”
Meanwhile, the company has made a provision of N86.764 million as claims for settlement of legal issues.
“During the year, a claim of N30 million was made by Special Piping Materials Nigeria Limited against the company on the legality of the certificate of occupancy obtained over a parcel of land leased from Barjol Engineering Services.
“Even though the parcel of land has been vacated by the company upon the expiration of the lease term, the Board’s directive was that the matter should proceed to trial and a provision should be made for the claim.
“Another claim of N56.764 million was made against the company in the financial year ended 31 December 2021, by a vendor on the refusal of the company to make payments for goods supplied during the year for which a judgement has been passed by the High Court of Rivers State on the payments to be made by the company to repudiate the affected party.
“The total liability of the company on the payments expected to be made for these claims totaled N 86.764 million (2021: N 56.764 million) and has been provided for in the year as the liability is expected to materialise within a short period,” the Directors stated.
Meanwhile, the company posted a revenue of N5.339 billion for 2022 which was a remarkable improvement compared with N3.699 billion in the corresponding period of 2021.
Profit before income tax (PBT) for the year was N704 million up from N552, while Profit after tax (PAT) rose to N448 million against N372 million post in 2021.
Unlike 2021 when Shareholders were rewarded with a stock dividend of one for every five shares, a cash dividend of 40 kobo per share is being proposed for the 2022 financial year.
