Pix capt: MD, Julius Berger, George Marks (right) and Financial Director, Wolfgang Kollermann, during the firm’s investors relations forum...recently
• Says Reforms Take Time
The Managing Director of Julius Berger Plc, George Marks, has enjoined Nigerians to be patient with President Muhammadu Buhari’s strategic economic reform policies, stressing that even in the most developed economies of the world, serious reforms take minimum of two years to begin to bear fruit.
Marks, who expressed what he considered his “rational and well-founded optimism that Nigeria will overcome its economic challenges”, called for reasonable patience from all citizens and stakeholders for the government’s economic reform agenda. “The economic horizon is good for the country as the prospect for stability and growth remains positive,” he stated.
At the 2016 Investor Relations Forum held earlier event in Lagos, the company announced that despite the systemic challenges it encountered during the 2015 financial year, the business of Julius Berger Nigeria Plc remained profitable.”
The company noted that with the presidential assent to the 2016 budget and its high implementation ratio, Nigeria’s economy is set for a positive turnaround.
Speaking at the review of business and operations in 2015, as well as, outlook for 2016, at the investor relations forum held at the Radisson Blu, Lagos, the MD and Financial Director, Wolfgang Kollermann, stated Julius Berger was committed to assisting in the infrastructure development of Nigeria.
Marks disclosed that the group has efficiently and effectively managed available resources to generate profits and maintain a solid liquidity position as it distributed dividends.
While giving details of the operational facts and figures as well as strategies to shareholders, the MD listed the macroeconomic challenges the firm faced, including fallen crude oil prices, revenues and external reserves, higher interest rates, scarcity of foreign exchange and unstable exchange rate regime.
“These contributed to an extremely volatile business environment, which ultimately affected most companies,” he said, pointing out that the consequence was a net fall in gross domestic product from 6.3 percent in 2014 to 4 percent in 2015 as well as a rise in unemployment and underemployment.
He added: “Businesses, especially construction industry whose infrastructural development works always have a strategic multiplier and diversification effect on the economy; now expect a proactive economic stimulus programme, governed by targeted revivalist policies.
“The Federation of Construction Industry (FOCI), now earnestly seeks a bailout programme for the sector. Struggling FOCI member-companies, now work below 30 percent capacity as clients’ inability overheads and suspension of works on numerous projects.”
Hinting at a slight downsizing of staff embarked upon by the firm, Marks noted that Julius Berger retains a necessary percentage of its capable employees, which it continues to train across functions and specialties both in Nigeria and outside the country.
He maintained that the business trajectory of Julius Berger Nigeria Plc as a brand remains good and workable, stressing that with the expected Economic stimulus programme of the Federal Government, the reconstruction of the Northeast, implementation of a National Integrated Infrastructure Master Plan and the Nigerian Industrial Revolution Plan among other palliative measures, the firm plans to implement a business strategy that focuses on participation programmes as the preferred partner.
Earlier the Financial Director of the firm, Kollermann, showed with facts and figures how Julius Berger’s profitability was sustained, pointing out that the management “proactively and rationally developed stringently targeted and efficient measures to alleviate the effects of the economic down turn and mitigate potential adverse consequences.
As stated by Kollermann, “the net result of the tough, but pragmatic measures adopted to attain cross-operational efficiency was that Julius Berger still achieved a positive result”, adding that while turnover in the period was N133.8bn or a decrease of 32percent, the cost of sales during the same period reduced by about 31 percent, proportionate to the turnover and reflecting efficient management of project direct cost.
On the gross profit margin, the Financial Director noted that the firm is ficially healthy despite a slight decrease by 3 percent compared to the previous year; this he said, “shows that the company has been able to maintain a certain threshold in the profit to sales ratio.”
He disclosed that during the year a VAT audit upon application by the management yielded the sum of N4bn to the company, remarking that while the net current assets of the company rose from N19.2bn to N48.5bn in the year, liabilities reduced.
“The company’s assets therefore, can sufficiently cover its liabilities in the short term, and the company has the capacity to invest in short-term expansion and diversification. The company against all odds also has been able to maintain its traditional dividend payout to shareholders. These successes have been achieved with the active collaboration and cooperation of shareholders, employees and stakeholders,” Kollermann declared.
Guardian