BY FESTUS OKOROMADU
The 2022 financial year does not look good for the shareholders of Notore Chemical Industries Plc, as the nitrogenous fertilizers manufacturers continues to post losses in the face of an overwhelming debt portfolio.
But the Board of Directors are not resting on their oars as they have proffered a threefold plan of raising funds through equity, bond issuance and deploying as a strategic partnerships focusing on new projects to create incremental revenue streams.
The equity fund raise is scheduled to be concluded by the end of the fourth quarter of 2023, while bond issuances will take place in 2024.
The firm’s audited financial accounts for the year ended December 31, 2022 released to the Nigerian Exchange Limited showed net losses of N7.2 billion and N6.8 billion as a group and company respectively, as against N9.6 billion and N9.1 billion net losses recorded by both group and company in the corresponding period of 2021.
Accumulated losses for the group and company stood at N38.9 billion and N38.2 billion respectively in 2022 as against N34.8 billion, and N34.4 billion) in 2021. Similarly, the net current liabilities of the group and company at the close of the 2022 financial year were N72.1 billion and N71.4 billion respectively, down from N82.2 billion; and N81.8 billion.
Responding to the critical situation painted in the financial statement, the Board of Directors in the note attached said, “These events or conditions indicate that a material uncertainty exist that may cast doubt on the Group and Company’s ability to continue as a going concern as to be able to realize their assets and discharge their liabilities in the normal course of business.”
The external auditors, Deloitte & Touche, Chartered Accountants, on its part expressed concerns over the firm’s ability to meet its obligations in the face of its large debt portfolio.
The auditors further noted: “The Group is heavily indebted and currently restructured its loan; hence increased finance cost. Also, the Group is experiencing overhaul of its plants to increase capacity and expansion. These events have exacerbated the losses from operations of the Group.
“The trend of recurring losses and net current liabilities are indications of a material uncertainty in relation to the going concern of the Group. We require management to provide their plans for the continued existence and a turnaround of the Group’s performance.”
Addressing the concerns raised by the auditors, the Board said, they have taken numerous steps with a view to increasing its plant production capacity output, operational stability, improve working capital and return to profitability.
