Shareholders expecting a dividend declaration from UPDC (Plc), formerly UACN Property Development Company, may have to wait much longer, judging by the audited financials the directors presented to the Nigerian Exchange Limited on Friday, a summary of which included the over 50% slump in revenue, and 358.87% drop in total comprehensive loss for the year, a pointer to the desperate need for a new business strategy to change its story.
With this, the directors confirmed that they are unable to “recommend the declaration of any dividend to the shareholders in view of the performance of the company.”
According to the result, revenue drop by N837.083m from N1.662bn in the 2020 full-year, to N825.404m; while gross profit stood at N140.278m, compared to a loss of N79.541m in the prior year. The company reported a N284.734m profit on disposal on investment property, compared to the previous loss of N47.173m; just as operating expenses dropped slightly to N908.523m from N942.64m; leaving operating loss for the period at N897.748m, compared to N712.96m.
Net finance cost amounted to N718.053m, about a 50% drop from N1.477bn in the corresponding period of 2020.
Loss before tax from continuing operations stood at N1.615bn, up from N262.693m; tax expense for the period increased marginally from N115.023m to N142.969m; resulting in loss after tax from continuing operations of N1.758bn, as against N377.716m in the comparable period of 2020. Total comprehensive loss for the period therefore amounted to N2.015bn, as against N439.15m reported in the preceding full-year. This translated to loss per share of 10 kobo, up from four kobo.
According to UPDC’s external auditors- Ernst & Young, the company has a significant N6.5bn receivable from UPDC Hotels Limited, now held for sale that its subsidiary and former Durbar Hotel, Festac Town. The amount, which was impaired, the audited said, represents 41% of the total assets of the company, noting the fear by management that the potential buyer may absorb the intercompany payables in the books of the subsidiary. As such, the amount, the auditors say, may not be recoverable, as confirmed also by the management, hence the impairment charge of N6.5bn in the company’s books.