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Honeywell Flour Set to Declare Dividend



By Goddy Egene, 06.15.2010


Investors in Honeywell Flour Mills Plc will soon smile as the directors get set to announce the first dividend since the company became listed on the Nigerian Stock Exchange (NSE).


Honeywell Flour Mills was listed on the Exchange last October after an Initial Public Offering that was done in the heat of the stock market lull. The IPO was highly successful and investors have been eager to receive their first dividend as a listed firm. However, the waiting will end soon as the Board of Directors  are said to be considering the  audited accounts for the year ended March 31, 2010 and decide the returns to be given to  investors.


Going by the information made available by the NSE last Monday, the Board of Directors of Honeywell Flour Mills was expected to meet yesterday. Although the meeting could not be confirmed before press time, it was gathered that the directors are ready to delight investors with good returns in form of cash dividend or bonus issue.According to market operators, given the third quarter performance and full year forecast, investors should expect an impressive performance. Honeywell Flour Mills had projected a turnover of N36 billion for the year ended March 31, 2010 and profit after tax of N1.77 billion.


The company had grown its profit by 307 per cent in the third quarter ended December 30, 2009.  It posted a turnover of N26.2 billion for the Q3 of 2009, indicating a growth of 24 per cent above the N21.1 billion recorded in the corresponding period of 2008. But profit after tax soared by 307 per cent or N657 million from N214 million in 2008 to N871 million in 2009. Some analysts have said that the company would achieve the forecast given the rate of growth of Q3 over the Q2. Comparably, the 307 per cent growth posted by the company in Q3 was better than  221 per cent recorded in Q2. 


While speaking on the Q2 results, the  Managing Director of the company, Mr. Babatunde Odunayo,  had attributed the impressive performance to the reduction in energy costs  occasioned by the inauguration and deployment of the Gas Plant in the production facility of the Flour Mills business.He had assured that  the performance would be sustained through the last  quarters of the company's financial year, adding that strategies have been put in place to further expand products line and deepen its market share.


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