R.T. Briscoe shareholders approve diversification plans

BY PETER EGWUATU

Shareholders of RT Briscoe Nigeria Plc have approved proposed plans by its Board of Directors to diversify its operations to non motor business activities.

The shareholders at the company’s Annual General Meeting (AGM) approved the proposed dividend of 10 kobo per share and bonus share of one for five held by them as April 21, 2011. They further applauded management’s drive on the growth and development of its industrial equipment

Speaking at the meeting, Mr. Clement Olowokande, Chairman of R.T Briscoe said there will be more emphasis on the after sales aspects of all their business activities to improve after market service competencies and effectiveness.

He said these efforts are expected to reposition the company for more effective and efficient service delivery including positively improving the shareholder value.

According to Olowokande, the Nigerian economy has yet to recover from the impact of the global economic recession witnessed by major economies of the world.

He said business activities were still low as the demand for capital goods declined significantly in 2010 when compared with that of previous years.

Olowokande said the banking sector has yet to fully recover from the recession and in spite of reforms, businesses still have difficulties accessing bank loans and facilities and lending rates have continued to increase, remarking that high costs of funds remains a deterrent to the acquisition of capital goods.

The chairman observed that the low demand for capital goods impacted on the company’s results for the year under review.

He said the motor business activities were particularly affected by the refusal of banks to grant consumer credit, adding that increased costs of procurement of vehicles from the company’s suppliers put pressure on margins, consequently; the turnover and profit margins of the motor business dropped but the Industrial Equipment however fared better in turnover with slightly improved margins in 2010.

The chairman said the company recorded a turnover and profit after tax of N15.1 billion and N152 million in 2010, remarking that cost saving measures introduced by the board in the course of the year proved very effective as selling and administrative expenses dropped by 18 per cent from N1.227 in 2009 to N1.035 billion in 2010.