NASCON mulls backward integration in tomato as shareholders greet 2017 feat
Leading indigenous manufacturer of tinned and sachet Tomato paste, NASCON Allied Industries, has given an indication of championing backward integration in the sub-sector effective this year.
The Managing Director of the company, Paul Farrer, while fielding questions from shareholders during the 2017 yearly general meeting held in Lagos recently, noted that the firm would prioritise local sourcing of raw materials.
He revealed that NASCON ventured into Tomato paste production based on the discovery of a critical supply gap within the Nigerian market where local production and imports failed to meet surging demand year-on-year.
According to him, “Tomatoes is on top of our priority, we are looking at backward integration and what we would do concerning the tomato paste going forward. The plants are not producing but we are looking at backward integration option for the past.”
Earlier in her review of the annual performance of the group, the chairperson, Yemisi Ayeni disclosed that NASCON leveraged its core competencies and operational discipline to advance the overall business and deliver unprecedented returns to shareholders.
She argued that a review of the firm’s financial statements for the year ended December 2017 showed improvement in all indices. She explained that revenue increased from ₦18.2 billion in 2016 to ₦27 billion in 2017, while profit before tax jumped by over 100 percent from ₦3.5 billion in 2016 to ₦7 billion.
Business Hilights can report that NASCON’s profit after tax also rose massively from ₦2.4 billion in 2016 to ₦5.3 billion, thus, becoming the biggest leap in the last 5 years.
Ayeni averred that “Earnings per share also increased from ₦0.91 in 2016 to ₦2.02 in 2017 while a dividend of ₦3.97 billion approved at the AGM, amounted to ₦1.50 per share. This represents a 110 percent increase from the ₦0.70 dividend paid in 2016.
“Salt earnings remain a key driver of revenue. Revenue from salt comprised 81 percent or ₦22.2 billion of the ₦27 billion, largely unchanged from the proportion of revenues it generated in 2016 while seasoning generated two percent of the revenues.
“NASCON also improved revenue across its geographical locations. Revenue from the eastern part of the country increased from ₦1.1 billion to ₦2.2 billion, the west also moved from ₦5 billion to ₦5.6 billion while the northern part of the country showed the biggest improvement as it jumped from ₦12 billion to ₦19 billion.”
In reciprocity to the management’s operational intelligence, the shareholders unanimously approved a dividend of N1.50 kobo per share at the meeting.