BY FESTUS OKOROMADU
The Board of Directors of GlaxoSmithKline Consumer Nigeria Plc, said it was unable to dispose of some assets worth N715 million in the 2022 financial year due to the negative business climate caused by the 2023 general election.
The firm in its annual report and financial statements for the year ended December 31, 2022, said the assets were held following the shutdown of its manufacturing facility in Agbara, Ogun State in 2021.
The report listed the item and their value as plant and machinery, furniture and fittings and motor vehicles in the facility with carrying values of N666 million, 28 Million and N21 Million respectively.
“As at the date of the shutdown the items were classified as assets held for sale following management’s commitment to sell the assets.
“On classification to hold for sale, the expectation was that the assets will be sold within a one year period. However, due to circumstances that arose in the course of the year which were previously considered unlikely, some of the assets were not sold as at 31 December 2022.
“In 2022, the Nigerian economy took a downturn and the negative perception of the occurrence of the 2023 general elections in Nigeria made businesses stall on making capital investment decisions which affected the sale of these assets,” the report read in part.
On steps taken to resolve the challenge, the Directors said they have taken the necessary action to respond to the change in the circumstances through direct engagement with potential purchasers to complement the bidding approach originally planned.
“Furthermore, the assets were reported to have been impaired and are being actively marketed at a price that is reasonable to their fair value, given the change in circumstances.”
However, the company’s directors also stated that they were able to sell assets with a total value of N31.6 million during the year.
“During the year, plants and machinery and motor vehicles with carrying amounts of N29.7 million and N4.8 million respectively were disposed of during the year through several bidding processes. Net gains of N7.1 million which arose from the disposals have been reported in “other gains and losses” in the statement of profit or loss under the non-operating segment.”
Meanwhile the firm’s revenue stood at N25.382 billion for the period under review up from N22.449 billion in the corresponding period of 2021.
Cost of sales stood at N18.452 billion, as against N16.270 billion in 2021 while profit after tax came to N771 million up from N659 million in 2021.
Consequently, the Board has recommended a dividend of N0.55k to be paid to shareholders.
GlaxoSmithKline Consumer Nigeria Plc is a public limited liability company incorporated in 1971 and domiciled in Nigeria where its shares are publicly traded. About 46.4 percent of the shares of the Company are held by Setfirst Limited and Smithkline Beecham Limited (both incorporated in the United Kingdom); and 53.6 percent by Nigerian
shareholders.
The ultimate parent and controlling party is GlaxoSmithKline Plc, United Kingdom (GSK Plc UK). GSK Plc UK controls the Company through Setfirst Limited and Smithkline Beecham Limited.
