By Gbenga Agbana Friday, 9 Jul 2010  

 

Shareholders on Thursday urged the board of directors of Public liability companies quoted on the Nigerian Stock Exchange to find a lasting solution to the problem of unclaimed dividends.

 

Speaking at the Annual General Meeting of May & Baker Nigeria Plc, a member of the Independent Shareholders Association of Nigeria, Mrs. Ayodele Kudaisi, urged the board of directors of publicly owned companies to device new means of dealing with the problem, since it is affecting shareholders.

 

Generally, unclaimed dividends accumulate over time, due to change of addresses by some shareholders without giving the registrar of companies such information; the death of some shareholder; or some other problems associated with the postal system. Some shareholders also ignore some dividend warrants, especially when the amount involved are insignificant.

 

Worried by the volume of unclaimed dividends, which runs into billions of naira, Kudaisi said, ”We shareholders are worried by the volume of unclaimed dividends in this country. What are you doing to reduce it? What are the board and management of quoted companies doing to ensure the dividends they declare get to the owners?

 

Another shareholder, Mr. Nornah Awoh, who also spoke at the meting, noted that some non-executive directors of the company are very old and stressed the need for them to allow younger people to be on the board and direct the affairs of the company.

 

He also advised the board of directors to strengthen the marketing division of the company to enhance turnover and returns to shareholders.Responding, the company‘s Chairman, General Theophilus Danjuma (retd), said, ”We are making progress. We are assisting the management in various ways on how to do things that will enhance shareholders‘ value.”

 

The Managing Director, Dr. Joseph Odumodu also explained that the board takes the issues affecting the welfare of shareholders very serious, adding that the two for five bonus proposed to shareholders by the board represents 40 per cent of their investment in the company.

 

He added that the company has built a N3bn plant at Ota, Ogun state, which when completed and becomes operational, will enhance shareholder value.Bt the results presented at the meeting, the company‘s after tax profit stood at N232m in 2008, down from N417.9m in 2008, on a turnover which fell from N5.44bn to N4.6bn.

 

Odumodu attributed the fall in turnover in 2009, to a major contract the company secured in 2008, which was about half a billion.

 

(Source:Punch)