PORTLAND PAINTS & PRODUCTS NIGERIA PLC
Transcript of PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
CONTENTS PAGE
Board of Directors and Professional Advisers 3
Results at a Glance 4
Directors' Report 5
Corporate Goverance Report 12
Report of the Audit Committee 19
Statement of Directors' Responsibilities 20
Independent Auditor's Report 21
Statement of Profit or Loss and Other Comprehensive Income 24
Statement of Financial Position 25
Statement of Changes in Equity 26
Statement of Cash Flows 27
Notes to the Financial Statements 28
Other National Disclosures:
Statement of Value Added 73
Five year Financial Summary 74
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
BOARD OF DIRECTORS AND PROFFESSIONAL ADVISERS
FOR THE YEAR ENDED 31 DECEMBER 2019
BOARD OF DIRECTORS
NAME DESIGNATION STATUS
Mrs. Esosa Balogun Chairman (Non-Executive Director) Appointed with effect from April 26, 2019
Mrs. Bolarin Okunowo Managing Director
Appointed as a director with effect from 29 May
2019 and appointed as Managing Director with
effect from March 21, 2020
Engr. ‘Dipo Ashafa Non-Executive Director
Mrs. Adeline Ogunfidodo Non-Executive Director
Dr. Vitus Ezinwa Non-Executive Director Appointed with effect from March 21, 2020
Mr. Mukhtar Yakasai Non-Executive Director Resigned with effect from January 31, 2019
Mr. Adedamola Olusunmade Managing Director Resigned with effect from March 20, 2020
Retirement by Rotation
RC Number: 76075
Company Secretary
Ms. Ayomipo Wey
FRC/2013/NBA/00000003124
Registered/Head Office
Sandtex House, 105A, Adeniyi Jones Avenue
Ikeja – Lagos
Tel: 08177290233
E-mail: [email protected]
Registrars Auditors
Africa Pridential Plc PriceWaterHouseCoopers
220b, Ikorodu road Palmgrove, Lagos
Landmark Towers, Plot 5B water corporation
road, Victoria Island Lagos
Tel: 07080606400 Tel: 01-2711700
Record of Directors’ Attendance at Board Meetings
In accordance with section 258 (2) of the Companies and Allied Matters Act, Cap C20 LFN 2004, the record of Directors’
attendance at Board meetings during the year is available for inspection at this Annual General Meeting.
FRC Number: FRC/2012/0000000000221
In accordance with the Articles of Association of the Company and Section 259 of CAMA, Mrs. Adeline Ogunfidodo and
Mrs. Esosa Balogun are the directors retiring by rotation and being eligible offer themselves for re-election.
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
RESULTS AT A GLANCE
FOR THE YEAR ENDED 31 DECEMBER 2019
Dec-19 Dec-18
N'000 N'000
Revenue from contracts with customers 2,610,178 2,829,262
Profit before taxation 127,195 307,533
Tax expense (42,301) (100,840)
Profit net of tax attributable to equity holders of the Company 84,894 206,693
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Total equity and liabilities 2,254,911 2,251,468
Shareholders' fund 1,582,204 1,536,981
Earnings per share (kobo) 11 26.05
Net assets per share (Naira) 2 2
Market price per share as at 31 December 2.23 2.80
Market capitalization as at December 1,769,317 2,221,564
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
1. LEGAL FORM
2. Principal activitiesPRINCIPAL ACTIVITIES
3. OPERATING RESULTS
Dec-19 Dec-18
N'000 N'000
2,610,178 2,829,262
859,552 836,496
127,195 307,533
(42,301) (100,840)
84,894 206,693
- 39,671
655,650 610,421
4. DIVIDEND
6. BOARD CHANGES
. Resignation
Pursuant to Section 258(2) of the Companies and Allied Matters Act, CAP C20 Laws of the Federation of Nigeria
2004, the record of Directors' attendance at Board meetings during the year under review will be available for
inspection at the Annual General Meeting.
The following resignations from the Board occurred during the course of the year:
Declared Dividend
The Directors do not recommend the payment of dividend for the financial year ended December 31, 2019 (2018:5k
per share).
Taxation
Profit After taxation
The following is the summary of the performance of the Company during the year under review as compared with the
previous year:
Operating Expenses
5. RECORD OF DIRECTORS’ ATTENDANCE AT MEETINGS
Retained Earnings
The Directors have the pleasure in presenting to the Members, their report on the affairs of Portland Paints & Products
Nigeria Plc (“Portland Paints” or the “Company”), together with the Audited Financial Statements and Independent
Auditor’s Report for the year ended December 31, 2019.
Portland Paints and Products Nigeria Plc (“Portland Paints” or “the Company”), a subsidiary of UAC of Nigeria Plc,
was incorporated as a private limited liability company on September 3, 1985. The Company by a special resolution
dated April 24, 2008 became a public limited liability company and thus changed its name to Portland Paints &
Portland Paints is a leading paints manufacturer in Nigeria and is among the most diversified paints manufacturing
companies with decades of experience in producing Decorative, Industrial and Marine/Protective coatings for the
building/construction and oil and gas industries in Nigeria. The flagship brand of the Company, Sandtex, has been, for
decades, distinguished for its exceptional quality. Sandtex has been formulated to provide protection and aesthetics for
various residential, commercial, corporate and industrial buildings.
The Company is certified with the NIS ISO 9001:2015 Quality Management System and conducts its business
operations by promoting the safety of all employees, customers and other stakeholders.
Turnover
Profit before taxation
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
. Appointments
7. DIRECTORS RETIRING BY ROTATION
- Mr Muhktar Yakasai resigned from the Board as Non-Executive Director, effective January 31, 2019
- Mr Adedamola Olusunmade resigned from the Board as managing Director effective March 20, 2020
In accordance with Section 256 of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of
Nigeria 2004 and in line with Article 95 of the Company's Articles of Association, Muhkar Yakasai resigned from the
board during the year, while Adedamola Olusunmade resigned after year end.
The Board was deeply appreciative of Mr Yakasai and Mr. Olusunamade for their immense contributions to the
growth of the company while wishing them all the very best as they purse other interests. The Nigerian Stock
Exchange and the Corporate Affairs Commission were also notified of their resignations
(a) Mrs. Bolarin Okunowo was appointed to the Board as a Non-Executive Director with effect from May 29, 2019.
Following the resignation of Mr. Adedamola Olusunmade, Mrs. Bolarin Okunowo was appointed as the Managing
Director with effect from March 21, 2020. The appointment of Mrs. Okunowo will be presented at this Meeting for
the approval of the Shareholders. The Nigerian Stock Exchange and the Corporate Affairs were notified of her
appointment.
Mrs. Bolarin Okunowo is a seasoned finance and investment specialist with over 15 years’ experience in a range of
finance roles including debt advisory, debt finance, corporate finance, principal investments and financial
management. She joined UAC of Nigeria Plc (“UACN”) Group in October 2018 and served as UACN’s Investment
Executive responsible for managing the company’s investments in its Industrial businesses (paints, logistics and real
estate). In her role as an Investment Executive, Bolarin was responsible for working with management teams to shape
strategy and deliver commercial outcomes.
Profile of Mrs. Bolarin Okunowo
Prior to joining UACN, she was the Head, Energy & Infrastructure Finance at Stanbic IBTC Capital (“Stanbic”) with
responsibility for the oil and gas, power and infrastructure debt finance portfolio. Bolarin led the execution of debt
advisory and debt arranging mandates for large scale energy and infrastructure projects in Nigeria. Prior to Stanbic,
Bolarin worked with ARM Investments Managers and PricewaterhouseCoopers. Bolarin is a qualified Chartered
Accountant; she holds a Bachelor’s degree in Commerce from the University of Birmingham UK and a Master’s
degree in Information Systems from the prestigious London School of Economics. She currently serves on the board
of Chemical and Allied Products Plc as a Non –Executive Director.
(b) Dr. Vitus Ezinwa – Dr. Ezinwa was appointed as a Non-Executive Director with effect from March 21, 2020.
The appointment of Dr. Ezinwa will be presented at this Meeting for the approval of the Shareholders. The Nigerian
Stock Exchange and the Corporate Affairs were notified of his appointment.
Profile of Dr. Vitus Ezinwa
Dr. Vitus Ezinwa is currently the Group Human Resources Director at UACN. He is a seasoned business manager
and human resource professional with experience in leading multinational corporations. Prior to Joining UACN, Vitus
worked as Group Human Resources Director for Promasidor Africa; Human Resources Director, Coca-Cola Nigeria
& Equatorial Africa with responsibility for 10 countries and Human Resources Director for British American
Tobacco, West & Central Africa covering Ghana, Benin, Niger & Togo. Vitus was, until recently, the Group Human
Resource Director for Tropical General Investments (TGI) Group. He is a member of the Advisory Board of
Afterschool Graduate Development Centre, member of the Institute of Directors and a Fellow of the Chartered
Institute of Personnel and Development (CIPD) UK. He is a co-founder and Director of HR Network Africa and was
until 2014, a member of the Lagos Business School’s Advisory Board.
In accordance with the Articles of Association of the Company and Section 259 of CAMA, Mrs. Adeline Ogunfidodo
and Mrs. Esosa Balogun are the directors retiring by rotation and being eligible, offer themselves for re-election.
Vitus holds a Bachelor’s degree in Sociology/Anthropology from the University of Nigeria, Nsukka, MBA in
Management from Lagos Business School, a Masters in Applied Business Research and a Doctorate in Business
Administration, both from Swiss Business School, Zurich, Switzerland. He joined UACN in November 2018 as the
Group Human Resources Director. In addition to sitting on the board of UACN, Vitus is a non-executive director of
Grand Cereals Limited.
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
8. DIRECTORS’ INDUCTION AND TRAINING
9. DIRECTORS INTERESTS IN CONTRACTS
10. DIRECTORS AND THEIR INTERESTS IN THE SHARES OF THE COMPANY.
31-Dec-19 31-Dec-19 31-Dec-18 31-Dec-18
S/N NAMES OF DIRECTORS DIRECT INDIRECT DIRECT INDIRECT
1 Mrs Esosa Balogun Nil Nil Nil Nil
2 Mrs Bolarin Okunowo Nil Nil Nil Nil
3 Engr. Oladipo Ashafa 776,347 Nil 776,347 Nil
4 Mrs Adeline Ogunfidodo 50,000 Nil 50,000 Nil
5 Dr. Vitus Ezinwa Nil 677,077,225 Nil Nil
11. ALTERNATE DIRECTORSHIP
12. SHAREHOLDING AND SUBSTANTIAL SHAREHOLDERS
S/N
PARTICULARS OF
SHAREHOLDER
1 UAC OF NIGERIA PLC
Directors’ interests in the issued share capital of the Company as recorded in the Register of Members and/or as
notified by the Directors in compliance with Sections 275 and 276 of the Companies and Allied Matters Act, CAP
C20, LFN 2004 and the Listing Requirements of the Nigerian Stock Exchange were as follows:
PERCENTAGE % OF
SHAREHOLDING
677,077,225 85.34
The issued and fully paid up share capital of the Company is N396,708,000 (Three Hundred and Ninety Six Million
Seven hundred and Eight Thousand Naira) divided into 793,415,535 (Seven Hundred and Ninety three Million Four
hundred and Fifteen Thousand, Five hundred and Thirty five) Ordinary shares of N0.50k each.
PERCENTAGE
85.34
NAME
Dr. Vitus Ezinwa
In terms of significant shareholding (5% and above), the Register as at 31 Dec, 2019 shows that UAC of Nigeria Plc
is the largest shareholder with 677,077,225 units of shares. The table below is instructive.
NUMBERS OF
SHARES
The newly appointed Directors all received letters of appointment detailing the terms of reference and composition of
the board and board committees, schedule of board meetings, their entitlements and demand on their time as a result
of their appointments. The letters of appointment was accompanied with the Memorandum and Articles of
Association of the Company, the previous year’s Annual Report, the Code of Corporate Governance for Public
Companies in Nigeria, UACN Code of Business Conduct, and other documents, policies, processes and procedures of
Portland Paints that help the directors gain understanding of the business operations of the Company, its history,
culture, values, business principles, people, projects, processes and plan.
None of the Directors has notified the Company for the purpose of Section 277 of the Companies and Allied Matters
Act of any declarable interest in Contracts in which Portland Paints is involved.
The details of indirect shareholding of Directors in the issued share capital of the Company is as follows:
INDIRECT
INTEREST (UAC
NIGERIA PLC
677,077,225
There was no alternate directorship during the year under review.
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
13. RANGE ANALYSIS OF SHAREHOLDING
No of
Holders Holder %
Holders
Cum Units Units % Units Cum
626 48.64% 626 206,631 0.03% 206,631
194 15.07% 820 564,539 0.07% 771,170
345 26.81% 1165 9,395,231 1.18% 10,166,401
34 2.64% 1199 2,726,648 0.34% 12,893,049
44 3.42% 1243 9,948,755 1.26% 22,841,804
17 1.32% 1260 12,808,561 1.61% 35,650,365
26 2.02% 1286 80,687,945 10.17% 116,338,310
1 0.08% 1287 677,077,225 85.34% 793,415,535
1,287 100% 793,415,535 100%
14. DIRECTORS’ REMUNERATION
Type
Fixed
Fixed
Fixed
Fixed
15. RESIGNATION AND APPOINTMENT OF COMPANY SECRETARY
Package
Basic Salary
13th
Month Salary
Directors’ fees
Sitting Allowance
5,001 - 50,000
50,001 - 100,000
100,001 - 500,000
500,001 - 1,000,000
1,000,001 - 250,000,000
250,000,001 - 1,000,000,000
Description Period
This is part of the gross
salary package for the
Managing Director only
Paid monthly during the
financial year
This is part of the gross
salary package for the
Managing Director only
Paid in the last month of the
year
Ms. Ayomipo Wey holds a Bachelor of Laws degree (LLB) from the Lagos State University, was called to the
Nigerian bar in 2008 and obtained a Master of Laws (LLM) (with distinction) from Queen Mary, University of
London in 2011. She has extensive legal, company secretarial, compliance and corporate governance experience
spanning over twelve (12) years. Prior to joining the Company, she was the Assistant Group General Counsel of
United Capital Plc from June 2015 to August 2019. She had her formative legal years in the prestigious law firm of
Banwo & Ighodalo where she spent over seven (7) years gathering extensive and invaluable knowledge and
experience in the legal aspects of corporate finance, mergers and acquisitions, corporate restructurings, corporate
governance and company secretarial practice.
She has an uncommon flair for corporate governance principles and practices and constantly advises on compliance
with extant laws and regulations on corporate governance.
Ms. Wey is a Member of the Institute of Chartered Secretaries and Administrators (UK) and the Nigerian Bar
Association.
As at the end of 2019, Portland Paint’s shares were held by 1,287 shareholders as analyzed below:
The Company ensures that remuneration paid to its Directors complies with the provisions of the Code of Corporate
Governance issued by the Securities and Exchange Commission (SEC) and the Financial Reporting Council. In
compliance with Section 34 (5) (f) of the SEC Code of Corporate Governance for Public Companies, the Company
makes disclosures of the remuneration paid to its Directors.
Mrs. Bolanle Maryanne Oyekan resigned as Company Secretary of the Company in August 2019. Following the
resignation of Mrs. Oyekan as Company Secretary of Portland Paints and after due and careful consideration by the
Board, Ms. Ayomipo Wey was appointed as Company Secretary of the Company with effect from September 9, 2019.
This is paid to Non-
Executive Directors only
Paid after attendance at each
meeting
Range
1 - 1,000
1,001 - 5,000
This is paid annually to
Non-Executive Directors
Paid in the first month of the
year
Profile of Ms Ayomipo Wey
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
16. BOARD EVALUATION
17. COMPLAINT MANAGEMENT FRAMEWORK
18. INSIDER TRADING AND PRICE SENSITIVE INFORMATION
19. WHISTLE BLOWING PROCEDURE.
20. ACQUISITION OF OWN SHARES
22. HUMAN RESOURCES REPORT
· Health, Safety and Welfare of Company employees
To assess the effectiveness of the Board and the individual Directors, a Board evaluation was undertaken, covering the
period of the financial year under review. This was driven by the Chairman of the Board in consultation with the
Company Secretary. The performance of the Board, Board Committees and individual directors were adjudged to be
satisfactory and the necessary feedback, arising from the exercise, were communicated to the individual directors of
the Company.
In accordance with the SEC directives on resolution of complaints, the Company has developed a Complaint
Management Policy and framework.
The Company has in place a Securities Trading Policy which prohibits the directors and employees from trading on
the Company’s shares during periods in which they are in possession of price sensitive information. The Company
was in compliance with the Securities Trading Policy during the year under review.
The Company has a Whistle Blowing Procedure which ensures that complaints are anonymously received, discretely
investigated and a report of the outcome of the investigation, sent to the Risk and Governance Committee.
The Company did not purchase any of its own shares during the year.
21. SEC CODE OF CORPORATE GOVERNANCE FOR PUBLIC COMPANIES AND THE NIEGRIAN
CODE OF CORPORATE GOVERNANCE 2018
The Company has complied with the Securities and Exchange Commission’s Code of Corporate Governance for
Public Companies in Nigeria. The Company also continues to comply with the provisions of the Nigerian Code of
Corporate Governance 2018.
The Company considers it a paramount objective to hire individuals based on standards of merit and competence.
Also, the Company upholds a sound culture of providing continued development and training for its Staff to address
knowledge gaps and provide new skill sets along the Company’s lines of responsibilities. Annually, trainings are
identified for staff and followed through in accordance with an approved training plan meant to ensure that this
objective is achieved. The Company encourages easy interaction between Management and other staff of the
Company so as to foster an atmosphere of warmth at work and also to kindle the necessary synergy required for the
Company’s success.
Our policy at all times is to conduct our operations safely, protecting the health and safety of employees and all
persons who may be affected. We manage our activities so as to give benefits to the society, ensuring that relevant
laws and regulations are kept and that our activities are acceptable to the community at large with minimal
environmental impact.
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
· Employee Involvement
· Training and Staff Development
· Anti-corruption and Business integrity
· Donations
S/N Amount (N)
1 450,000
2 182,767
632,767
23. EVENTS AFTER REPORTING PERIOD
24. FIXED ASSETS
25. AUDITORS
FRC/2013/NBA/00000003124
Children's Day - Visit to Love Orphanage, Magodo
Painting of Boet Estate Gate, Ikeja, Lagos
Total
BY ORDER OF THE BOARD
There were no significant events after the reporting period which could have had a material effect on the financial
position of the Company as at 31 December 2019 and on the profit and other comprehensive income for the period
then ended.
In the opinion of the Directors, the market value of the Company’s fixed assets is not less than as shown in the
Balance Sheet. Information relating to property, plant and equipment is given in Note 10 to the financial statements.
The Auditors are Messrs. PricewaterhouseCoopers, having indicated their willingness to continue in office pursuant to
Section 357 (2) of the Companies and Allied Matter Act, CAP C20 Laws of the Federation of Nigeria, 2004.
Dated this 17th day of March, 2020
Description
AYOMIPO WEY
Company Secretary
Portland Paints continues to pursue the Great place to work global initiative which is aimed at creating a better society
of happier employees. To achieve this, an engaged work culture is being entrenched company-wide.
The Company recognizes training of its human resources as an investment which adds value to the business. We are
therefore committed to continuous development of our workforce through courses and seminars organized internally
and externally including overseas courses. Individual needs of each employee are considered in organizing training
courses. Members of staff are also encouraged and assisted financially to embark on self-development schemes to
improve themselves both academically and professionally.
The Company does not give or receive whether directly or indirectly, bribes or other improper advantages for business
or financial gain. No employee may offer, give or receive any gift or payment which is or may be construed as being,
a bribe. Any demand for, or offer of, a bribe must be rejected immediately and reported to management. No employee
will be criticized for any loss of business resulting from adherence to these principles. The Company’s accounting
records and supporting documents must accurately describe and reflect the nature of the underlying transactions. No
undisclosed or unrecorded account, fund or asset will be established or maintained.
A whistle blowing policy has also been put in place to encourage employees at all levels to alert and inform
management of any negative development that might impinge on the value, performance and/or image of the
Company before any harm is done. Similarly a corporate fraud policy has been established to facilitate the
development of controls which will aid in the detection and prevention of fraud against the company. It is our
intention to promote consistent organizational behavior by providing guidelines and assigning responsibility for the
development of controls and conduct of investigations.
The following amounts were given by way of gifts and donations during the year ended 31 December, 2019:
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2019
SHAREHOLDERS INFORMATION
Register Range Analysis
No of
Holders Holder %
Holders
Cum Units Units % Units Cum
626 48.64% 626 206,631 0.03% 206,631
194 15.07% 820 564,539 0.07% 771,170
345 26.81% 1165 9,395,231 1.18% 10,166,401
34 2.64% 1199 2,726,648 0.34% 12,893,049
44 3.42% 1243 9,948,755 1.26% 22,841,804
17 1.32% 1260 12,808,561 1.61% 35,650,365
26 2.02% 1286 80,687,945 10.17% 116,338,310
1 0.08% 1287 677,077,225 85.34% 793,415,535
1,287 100% 793,415,535 100%
Share Capital History
Year Authorized Share Capital N'000
1993 2,000,000
2002 200,000,000
2008 200,000,000
2015 500,000,000
2017 500,000,000
2019 500,000,000
Notice to Shareholders
Unclaimed Dividends and Share Certificates
1,000,001 - 250,000,000
250,000,001 - 1,000,000,000
Range
1 - 1,000
1,001 - 5,000
5,001 - 50,000
50,001 - 100,000
100,001 - 500,000
4,000,000
400,000,000
400,000,000
40,000,000
500,001 - 1,000,000
The total amount of unclaimed dividends as at December 31, 2019 is N20,009,026.21. The total number of unclaimed
certificates as at December 31, 2019 is nil.Shareholders who are yet to claim their dividends are required to fill out the e-dividend mandate form attached to this
Annual Report and to submit physical or scanned copies of the form to the Registrar at Africa Prudential Plc, 220b,
Ikorodu road, Palmgrove, Lagos; Email- [email protected]
793,415,535
793,415,535
4,000,000
36,000,000
360,000,000 Bonus Issue
360,000,000
393,415,535 Right Issue
793,415,535
2,000,000
18,000,000
180,000,000
180,000,000
196,707,768
396,707,768
According to the Register of Members, UAC of Nigeria Plc held 5% and above of the issued share capital of Portland
Paints and Products Nigeria Plc as at 31 December 2019.
Issued Share Capital N'000
Number of Shares
'000
Cumulative Number of
Shares
'000
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
INTRODUCTION
1. THE BOARD
1.1 General
1.2 Appointment Process
1.3 General Board Philosophy
1.4 Chairman and CEO Positions
1.5 Non-Executive Directors
1.6 Board Changes
CORPORATE GOVERNANCE REPORT
In the same vein, Mrs. Bolarin Okunowo was appointed to the Board as a Non-Executive Director with effect from
May 29, 2019.
Mr. Adedamola Olusunmade resigned as Managing Director and from the Board with effect from March 20, 2020
while Mrs. Bolarin Okunowo was appointed as the Managing Director of the Company with effect from March 21,
2020. Also, Dr. Vitus Ezinwa was appointed to the Board as a Non-Executive Director effective March 21, 2020.
Their appointments will be presented to the Members at General Meeting for approval. The Nigerian Stock Exchange
and the Corporate Affairs Commission were notified on the various changes to the Board.
In accordance with best practices, the Board comprises of Five (5) Directors made of up four (4) non-executive
directors and the Managing Director. The Board members are professionals and business persons with vast experience
and credible track record.
The Board appointment process is guided by transparent and high ethical standards. In other words, the process of
appointment to the Board of Portland Paints is transparent and in accordance with relevant regulatory laws and
guidelines. In compliance with the SEC Code of Corporate Governance, the Nigerian Code of Corporate Governance
and the Board Charter, the Directors are selected based on their skills, competence and experience. Upon approval by
the Board, the Nigerian Stock Exchange and the Corporate Affairs Commission are notified of the appointments of
The Board provides overall guidance and policy direction to the Management and acts on behalf of Shareholders in
the overall interest of stakeholders and is accountable to the shareholders. It prides itself in people with a blend of
experience and knowledge cutting across various industries.
In accordance with good corporate governance practices, the positions of the Managing Director and that of the
Chairperson of the Board are occupied by different persons and while the Managing Director is responsible for
implementation of the Company’s business strategy and the day-to-day management of the business, the Chairperson
is not involved in the day-to-day operations of the Company and is not a member of any committee of the Board.
The Non-Executive Board members possess strong knowledge of the Company’s business and usually contribute
actively at Board meetings.
During the year under review, Mr. Muhktar Yakasai resigned from the Board of Portland Paints as a Non-Executive
Director effective January 31, 2019.
Portland Paints has in place an effective governance mechanism that ensures proper oversight of its business by the
Directors and other principal organs of the Company.
The Board is responsible for developing the Company’s strategy and ensuring that its available assets are utilized
towards the attainment of its set strategy and plans. The Board performs supervisory oversight over management
activities ensuring that the affairs of the Company are conducted in a manner that increases the value of shareholders’
investments and is also beneficial to all other stakeholders of the Company.
Portland Paints & Products Nigeria Plc (“Portland Paints” or the “Company”) is a Company with high ethical
standards. The Company is committed to conducting its business operations in full compliance with the laws and
regulations of Nigeria and the UAC of Nigeria Group Code of Business Conduct.
Our actions and interactions with customers, employees, government officials, suppliers, shareholders and other
stakeholders reflect our values, beliefs and principles.
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
CORPORATE GOVERNANCE REPORT
1.7 Attendance of Board Meetings
1.8 Board Meeting Attendance
KEY
P = Present
S/N Members 11/3/2019 17/4/2019 30/5/2019 19/7/2019 15/10/2019 29/11/2019
1 Mrs Esosa Balogun NYA NYA P P P P
2 Mr Adedamola Olusunmade P P P P P P
3 Engr 'Dipo Ashafa P P P P P P
4 Mrs Adeline Ogunfidodo P P P P P P
5 Mrs Bolarin Okunowo NYA NYA P P P P
1.9 Board Committees
1.9.1 Risk and Governance Committee
5. Mr. Adedamola Olusunmade- Member/ Managing Director (resigned with effect from March 20, 2020)
The Risk and Governance Committee is responsible for the oversight of risk and on governance related matters.
The Committee is constituted as follows:
1. Engr. Oladipo Ashafa - Chairman/Non-Executive Director
2. Mrs. Bolarin Okunowo - Member/ Non-Executive Director (appointed as Non-Executive Director effective
May 29, 2019 and subsequently as Managing Director with effect from March 20, 2020)
3. Mrs. Adeline Ogunfidodo - Member/Non-Executive Director
4. Dr. Vitus Ezinwa - Member/Non-Executive Director (Appointed with effect from March 21, 2020)
The Board meets at least once in every quarter or as frequently as the Board’s attention may be required on any
situation which may arise. Sufficient notices with clear agenda and reports are usually given prior to convening such
meetings.
A total of six (6) Board Meetings were held in the 2019 Financial Year. The table below shows Directors’ attendance
at the meetings.
The Board carries out its oversight function through its standing Committee, the Risk and Governance Committee,
which has a Term of Reference that clearly defines its purpose, composition and structure, frequency of meetings and
tenure amongst others. Through the Committee, the Board monitors the effective coverage and control over the
operations of the Company. It is important to state that in line with best practice, the Chairman of the Board does not
sit on the Board Committee.
NYA = Not Yet appointed
13
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
CORPORATE GOVERNANCE REPORT
Risks
Governance
17. Review the Company’s operational performance;18. Make recommendations to the Board on capital expenditure, specific projects and their financing within the
overall approved plan;
19. Appraise the investment climate and recommend to the board where, when and what investment(s) to make with
the Company’s surplus funds;
20. Make recommendations on management of Company’s cash and debt exposure/ borrowings;
21. Monitor compliance with applicable laws and regulations by the Company;
22. Review updates on implementation level of Internal and external auditors’ recommendations by management
from Board representatives on the Audit Committee;
11. Review the process for identifying and analyzing business level risks;
12. Review the structure for, and implementation of, risk measurement and reporting standard as well as
methodologies;
13. Review key control processes and practices of the Company, including limit structures.
14. Ensure that the Company’s risk management practices and conditions are appropriate for the business
environment;
15. Assess new risk return opportunities.
16. Oversee the Company’s financial reporting, its policies and processes;
5. Periodically evaluate the Company’s risk profile, action plans to manage high risks and progress on the
implementation of these plans;
6. Ensure that the Company’s risk exposures are within the approved risk control limits;
7. Undertake at least annually a thorough risk assessment covering all aspects of the company’s business with a
view to using the result of the risk assessment to update the risk management framework of the company;
8. Understand the principal risk to achieving the Company’s strategy;
9. Ensure that the business profile and plans are consistent with the Company’s risk appetite;
10. Make recommendation on the Company’s risks management framework including responsibilities, authorities and
control;
The following are the Committee’s terms of reference:
1. Assist the Board in its oversight of risk management and monitoring the Company’s performance with regards to
risk management;
2. Recommend for Board approval the risk policy of the Company and review its implementation at all levels to
achieve the Company’s objective ;
3. Monitor that risk management policies are integrated into the Company’s culture;
4. Review quarterly risk management reports and make recommendation to the Board on appropriate actions;
14
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
CORPORATE GOVERNANCE REPORT
S/N Members 7/3/2019 16/4/2019 18/7/2019 14/10/2019
Total
Number of
Meeteings
Attended
Percentage of
Attendance
1 Engr 'Dipo Ashafa P P P P 4 100%
2 Mr Adedamola Olusunmade P P P P 4 100%
3 Mrs Bolarin Okunowo NYA NYA P P 2 100%
4 Mrs Adeline Ogunfidodo P P P P 4 100%
2. THE STATUTORY AUDIT COMMITTEE
2.1 Terms of Reference of the Statutory Audit Committee
c) review the findings as reported through the management controls report and management responses thereon;
d) keep under review the effectiveness of the Company’s system of accounting and internal control;
e) make recommendation to the Board with regards to the appointment, removal and remuneration of the external
auditors of the Company;
f) authorize the internal auditor to carry out investigations into any activities of the Company, which may be of
interest or concern to the Committee.
2. Comrade Sulaimon Adenrele Member/Shareholder
3. Mrs. Adeline Ogunfidodo Member/Non-Executive Director
4. Engr. ‘Dipo Ashafa Member/Non-Executive Director
The Committee is authorized by the Companies and Allied Matters Act, CAP C20 Laws of the Federation 2004 to:
a) ascertain whether the accounting and reporting policies of the Company are in accordance with legal
requirements and agreed ethical practices;
b) review the scope and planning of external audit;
29. Periodically review and make recommendations to the Board on the compensation, performance and talent
management, succession planning and retention for the Company;
30. Make recommendations on the whistle blowing process for the Company.
The Committee met four (4) times in 2019. The table below shows Directors’ attendance at the meetings.
By virtue of section 359 (3) of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria
2004, every public company is required to establish a Statutory Audit Committee (“SAC”) composed of an equal
number of Directors and representatives of its Shareholders, subject to a maximum of six (6) members.
The Committee is currently constituted with 4 (Four) members as follows:
1. Mr. Shamsideen Balogun Chairperson/Shareholder
23. Periodically review the manning level and adequacy of the resources with which internal audit and the risk
management functions discharge their duties;
24. Monitor, benchmark and apply as appropriate, best practices with regard to governance and risk;
25. Review accounting policies and reporting standards and ensure their adequacy for the Company’s purposes;
26. Make recommendations on the composition of the Board;
27. Recommend the appointment, remuneration and promotion of Executive Directors and Senior Management;
28. Make recommendations to the Board on the adoption of a code of conduct (including the policy on trading in
company shares) for Directors and senior executives and to review same from time to time;
15
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
CORPORATE GOVERNANCE REPORT
2.2 Attendance of SAC Meetings
S/N Members 7/3/2019 16/4/2019 18/7/2019 14/10/2019
Total
Number of
Meeting
Attended
Percentage of
Attendance
1 Mr Shamsideen Balogun P P P P 4 100%
2
Comrade Sulaimon
Adenrele P P P P 4 100%
3 Engr 'Dipo Ashafa P P P P 4 100%
4 Mrs Adeline Ogunfidodo P P P P 4 100%
n) Consider any related party transactions that may arise within the company or group;
o) Invoke its authority to investigate any matter within its terms of reference and the company must make available
resources, including internal audit and access to external advice where necessary, to carry out this function; and report
In the course of the financial year 2019, the SAC met five (5) times as outlined in the schedule below:
h) Discuss policies and strategies with respect to risk assessment and management;
i) Meet separately and periodically with management, internal auditors and external auditors;
j) Review and ensure that adequate whistle-blowing procedures are in place. A summary of issues reported are
highlighted to the chairman;
k) Review, with the external auditor, any audit scope limitations or problems encountered and management’s
responses to same;l) Review the independence of the external auditors and ensure that where non-audit services are provided by the
external auditors, there is no conflict of interest;m) Preserve auditor independence, by setting clear hiring policies for employees or former employees of
independent auditors;
b) Assist in the oversight of the integrity of the Company’s financial statements, compliance with legal and other
regulatory requirements, assessment of qualifications and independence of external auditor and performance of the
Company’s internal audit function as well as that of external auditors;
c) Establish an internal audit function and ensure there are other means of obtaining sufficient assurance of regular
review or appraisal of the system of internal controls of the company;
d) Ensure the development of a comprehensive internal control framework for the company; obtain assurance and
report annually in the financial report, on the operating effectiveness of the company’s internal control framework;
e) Oversee management’s process for the identification of significant fraud risks across the company and ensure
that adequate prevention, detection and reporting mechanisms are in place;
f) At least on an annual basis, obtain and review a report by the internal auditor describing the strength and quality
of internal controls including any issues or recommendations for improvement, raised by the most recent control
review of the company;g) Discuss the annual audited financial statements and half yearly unaudited statements with management and
external auditors;
In addition, the 2011 Securities and Exchange Commission (SEC) Code of Corporate Governance also assigns the
following responsibilities to the Audit Committee:
a) To oversee internal audit and internal controls; and to document and review the roles, responsibilities, authority
and scope of operations of the internal audit function; approve the annual internal audit plan.
16
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
CORPORATE GOVERNANCE REPORT
3. ACOUNTABILITY, AUDIT AND CONTROL
3.1 Financial reporting
3.2 Control Environment
4. COMPANY SECRETARY
5 SHAREHOLDERS
The Company ensures the existence of adequate interaction among the Shareholders, the Management and the Board
of the Company. The Company’s General Meetings provide Shareholders the platform to contribute to the
administration of the Company. The Annual General Meetings (AGMs) are held in accessible locations and are open
to Shareholders or their proxies. The AGMs are conducted in a manner that facilitates Shareholders’ participation in
accordance with relevant regulatory and statutory requirements.
The Company encourages Shareholders to attend these meetings by ensuring that notices of meetings and other
information required by Shareholders to make informed decisions are dispatched in a timely manner. The office of the
Company Secretary additionally affords Shareholders channels of communication to the Board and the Management
of the Company.
The Company has consistently improved its internal control system to ensure effective management of risks. The
Directors review the effectiveness of the system of internal control through regular reports and reviews at Board and
Risk and Governance Committee Meetings.
The Board has continued to place emphasis on risk management as an essential tool for achieving the Company’s
objectives. Towards this end, it has ensured that the Company has in place robust risk management policies and
mechanisms to ensure the identification of risks and effective controls.
The Board approves the annual budget for the Company and ensures that a robust budgetary process is operated with
adequate authorization levels put in place to regulate capital expenditure.
The Company Secretary plays an important role in supporting the effectiveness of the Board by assisting the Board
and management to develop good corporate governance practices and culture within the Company. The Company
Secretary ensures adequate dissemination of information among Board members and between the Board and the
Management of the Company. In furtherance of Board and Committee meetings, the Company Secretary undertakes
the preparation of the necessary papers and other documents requisite for the success in deliberations. The Company
Secretary is responsible for providing the Board and Directors individually, with detailed guidance as to how their
responsibilities should be properly discharged in the best interest of the Company.
The Office of the Company Secretary ensures that the Company complies with the relevant regulatory laws including
the Investments and Securities Act No 29 of 2007, the Securities and Exchange Commission (SEC) Rules and
Regulations, the Securities and Exchange Commission (SEC) Code of Corporate Governance, the Nigerian Code of
Corporate Governance, the Companies and Allied Matters Act, the Nigeria Stock Exchange Rules and Regulations,
amongst others.
The procedure for the appointment and removal of the Company Secretary is a matter for the Board.
The Directors make themselves accountable to shareholders through regular publication of the Company’s financial
performance and annual reports.
The Board is mindful of its responsibilities and is satisfied that in the preparation of its financial report, it has
presented a balanced assessment of the Company’s position and prospects in accordance with its obligation under the
Code of Corporate Governance.
PriceWaterHouseCoopers acted as external auditors to the Company during the 2019 financial year.
17
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FOR THE YEAR ENDED 31 DECEMBER 2019
CORPORATE GOVERNANCE REPORT
6. CODE OF BUSINESS CONDUCT
It is the responsibility of the Shareholders to approve the appointment of Directors and to grant other approvals that
are required by law or the Articles of Association of the Company.
The Shareholders through its representatives on the Statutory Audit Committee in line with section 359 of the CAMA
and the SEC Code also assume responsibility for the integrity of the Company’s audited accounts.
As a member of the UAC of Nigeria Plc Group, the employees of the Company subscribe to UACN Code of Business
Conduct. The Code forms the basis of the conduct expected of every employee of the Company and reflects our core
values and principles. The Board of Directors is responsible for ensuring that the Code is communicated to,
understood and observed by all employees.
18
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
REPORT OF THE AUDIT COMMITTEE
FOR THE YEAR ENDED 31 DECEMBER 2019
To Members of Portland Paints and Products Nigeria Plc,
(1)
(2)
(3)
(4)
Mr Shamsideen Balogun
Chairman, Audit Committee
FRC/2015/NIM/00000013086
Mr. Shamsideen Balogun Chairman
Comrade Sulaiman B. Adenrele Member
Mrs. Adeline Ogunfidodo Member
Engr.Dipo Ashafa Member
We deliberated with the external auditors who confirmed that all necessary cooperation was received from
management and that they had issued a clean report in respect of the year ended December 31, 2019.
Dated March 16, 2020
Members of the Statutory Audit Committee are as follows:
In compliance with the provisions of Section 359 (6) of the Companies and Allied Matters Act (Cap C20) Laws
of the Federation of Nigeria 2004 (“CAMA”), we the members of the Statutory Audit Committee of Portland
Paints and Products Nigeria Plc (the “Company”) hereby report that we have exercised our statutory functions
under Section 359 (6) of CAMA and acknowledge the cooperation of the Management and Staff in the conduct
of these responsibilities.
Specifically we confirm that:
The accounting and reporting policies of the Company are consistent with legal requirements and agreed
ethical practices.
The scope and planning of the external audit for the year ended December 31, 2019 were satisfactory and
adequate.
The Company maintained effective systems of accounting and internal controls during the year.
The Company’s Management adequately responded to matters covered in the management report issued
by the external auditors.
19
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
STATEMENT OF DIRECTORS' RESPONSIBILITIES
FOR THE YEAR ENDED 31 DECEMBER 2019
a)
b)
c)
Mrs Esosa Balogun
Chairperson Managing Director
FRC/2013/ICAN/00000001186 FRC/2020/003/00000020616
March 17, 2020
The Companies and Allied Matters Act Cap C20, Laws of the Federation of Nigeria, 2004 (“CAMA”) requires the
Directors to prepare financial statements for each financial year that give a true and fair view of the state of financial
affairs of the Company at the end of the year and of its profit or loss. The responsibility includes:
The directors accept responsibility for the financial statements, which have been prepared using appropriate accounting
policies supported by reasonable and prudent judgements and estimates, in conformity with International Financial
Reporting Standards and the requirements of the Companies and Allied Matters Act.
The responsibilities includes:
Ensuring that the Company keeps proper accounting records that disclose, with reasonable accuracy, the financial
position of the Company and comply with the requirements of CAMA;
preparing the company’s financial statements using suitable accounting policies supported by reasonable and
prudent judgements and estimates, that are consistently applied.
designing, implementing and maintaining internal control relevant to the preparation and fair presentation of
financial statements that are free from material misstatement, whether due to fraud or error; and
The directors are of the opinion that the financial statements give a true and fair view of the state of the financial affairs of
the Company and of its profit or loss. The directors further accept responsibility for the maintenance of accounting
records that may be relied upon in the preparation of financial statements, as well as adequate systems of internal financial
control.
Nothing has come to the attention of the directors to indicate that the Company will not remain a going concern for at least
twelve months from the date of this statement.
March 17, 2020
Mrs Bolarin Okunowo
20
PricewaterhouseCoopers Chartered Accountants Landmark Towers, 5B Water Corporation Road, Victoria Island, Lagos, Nigeria
Independent auditor’s report To the Members of Portland Paints & Products Nigeria Plc
Report on the audit of the financial statements
Our opinion In our opinion, Portland Paints & Products Nigeria Plc’s (“the company’s”) financial statements give a true and fair view of the financial position of the company as at 31 December 2019, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards and the requirements of the Companies and Allied Matters Act and the Financial Reporting Council of Nigeria Act.
What we have audited
Portland Paints & Products Nigeria Plc’s financial statements comprise:
• the statement of profit or loss and other comprehensive income for the year ended 31 December 2019;
• the statement of financial position as at 31 December 2019;
• the statement of changes in equity for the year then ended;
• the statement of cash flows for the year then ended; and
• the notes to the financial statements, which include a summary of significant accounting policies.
Basis for opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the company in accordance with the International Code of Ethics for Professional Accountants (including International Independence Standards), i.e. the IESBA Code issued by the International Ethics Standards Board for Accountants. We have fulfilled our other ethical responsibilities in accordance with the IESBA Code.
Key audit matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined that there are no key audit matters to communicate in our report.
Other information
The directors are responsible for the other information. The other information comprises the Board of directors
and professional advisers, Results at a glance, Director’s Report, Corporate Governance Report, Statement of Directors’ Responsibilities, Report of the Audit Committee, Statement of Value Added and Five-Year Financial Summary (but does not include the financial statements and our auditor’s report thereon), which we obtained prior to the date of this auditor’s report, and the other sections of the Portland Paints & Products Nigeria Plc 2019 Annual Report, which are expected to be made available to us after that date.
Our opinion on the financial statements does not cover the other information and we do not and will not express an audit opinion or any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
When we read the other sections of the Portland Paints & Products Nigeria Plc 2019 Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
Responsibilities of the directors and those charged with governance for the financial statements The directors are responsible for the preparation of the financial statements that give a true and fair view in accordance with International Financial Reporting Standards and the requirements of the Companies and Allied Matters Act, the Financial Reporting Council of Nigeria Act, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the company’s financial reporting process.
Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
The Companies and Allied Matters Act requires that in carrying out our audit we consider and report to you on the following matters. We confirm that:
i) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
ii) the company has kept proper books of account, so far as appears from our examination of those books and returns adequate for our audit have been received from branches not visited by us;
iii) the company’s statement of financial position and statement of profit or loss and other comprehensive income are in agreement with the books of account.
For: PricewaterhouseCoopers 30 April 2020
Chartered Accountants
Lagos, Nigeria
Engagement Partner: Rasheed Rahji
FRC/2014/ICAN/00000008856
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Dec-19 Dec-18
Note N'000 N'000
Revenue from contracts with customers 4 2,610,178 2,829,262
Cost of sales 6(a) (1,649,439) (1,753,972)
Gross profit 960,739 1,075,290
Other operating income 5 18,354 67,841
Selling and distribution expenses 6(a) (286,238) (264,619)
Administrative expenses 6(a) (536,698) (551,883)
Impairment losses on financial assets 13ii (36,616) (19,994)
Profit from operations 119,541 306,635
Finance income 7 11,522 11,799
Finance cost 8 (3,868) (10,901)
Net finance costs 7,654 898
Profit before taxation 127,195 307,533
Tax expense 9 (42,301) (100,840)
Profit from continuing operations 84,894 206,693
Profit from discountinued operations - -
Other comprehensive income - -
Total comprehensive income 84,894 206,693
Earnings per share for profit attributable to owners
of the Company during the year:
Basic (Kobo) 20 11 26
Diluted (Kobo) 20 11 26
The notes on pages 28 to 72 form an integral part of these financial statements.
24
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Notes Dec-19 Dec-18
N'000 N'000
ASSETS:
Non - current assets:
Property, plant and equipment 10 428,123 441,919
Intangible assets 11 74,749 85,442
Prepayments 14 1,769 5,537
Right of use asset 15 22,092 -
Deferred tax asset 19(a) 11,619 -
Total non - current assets 538,352 532,898
Current assets:
Inventories 12 891,255 728,047
Trade and other receivables 13 512,499 476,180
Prepayments 14 33,057 22,688
Cash and cash equivalents 16 279,749 491,655
Total current assets 1,716,560 1,718,570
Total assets 2,254,911 2,251,468
Equity and liabilities
Equity:
Issued share capital 20 396,708 396,708
Share premium 20 437,923 437,923
Other reserves 20 91,923 91,923
Retained earnings 655,650 610,427
Equity attributable to owners of the parent 1,582,204 1,536,981
Non current liabilities:
Deferred tax liabilities 19(a) - 14,048
Lease liability 15aii 17,374 -
Total non current liabilities 17,374 14,048
Current liabilities:
Trade and other payables 17 553,489 501,988
Contract liabilities 4(b) 17,147 55,373
Provisions 18 3,000 24,917
Lease liability 15aii 4,416 -
Income tax payable 19 77,281 118,161
Total current liabilities 655,333 700,439
Total liabilities 672,707 714,487
Total equity and liabilities 2,254,911 2,251,468
Raheem Adejumobi
(Finance Manager)
Mrs Bolarin Okunowo
(Managing Director)
FRC/2016/ICAN/00000014225 FRC/2020/003/00000020616
The audited financial statements on pages 24 to 74 was approved by the board of directors on 17th March, 2020
and signed on its behalf by:
Mrs Esosa Balogun
(Chairman)
FRC/2013/ICAN/00000001186
25
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
STATEMENT OF CHANGES IN EQUITY
FOR YEAR ENEDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Share
capital
Share
Premium
Other
Reserves
Retained
earnings Total equity
N'000 N'000 N'000 N'000 N'000
1 January 2018 396,708 437,923 91,923 466,461 1,393,015
Increase in impairment losses on
adoption of IFRS 9 - - - (62,727) (62,727)
1 January 2018 restated 396,708 437,923 91,923 403,734 1,330,288
Profit for the year - - - 206,693 206,693
31 December 2018 396,708 437,923 91,923 610,427 1,536,981
1 January 2019 396,708 437,923 91,923 610,427 1,536,981
Dividend paid - - - (39,671) (39,671)
Profit for the year - - - 84,894 84,894
31 December 2019 396,708 437,923 91,923 655,650 1,582,204
The notes on pages 28 to 72 form an integral part of these financial statements.
26
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Dec-19 Dec-18
N'000 N'000
Cash flows from operating activities:
Cash (used in) / generated from operations 21 (75,215) 474,831
Legal claims paid - (4,983)
Income tax paid 19 (51,709) (44,692)
Net cash generated from / (used in) operating activities (126,924) 425,156
Cash flows from investing activities:
Purchase of property, plant and equipment 10 (53,815) (84,996)
Purchase of intangible assets 11 - (2,190)
Proceeds from sales of property,plant and equipment 21.1 2,982 2,322
Finance income 7 11,522 11,799
Net cash used in investing activities (39,311) (73,065)
Cash flows from financing activities:
Repayments of borrowings - (47,813)
Interest paid (3,868) (1,974)
Other direct fees and charges on borrowings - (4,856)
Repayment on lease liabilities (2,132) -
Dvidend paid (39,671) -
Net cash used in financing activities (45,671) (54,643)
Net (decrease)/ increase in cash and cash equivalents (211,906) 297,448
Cash and cash equivalents brought forward 491,655 194,207
Cash and cash equivalents 16 279,749 491,655
The notes on pages 28 to 72 form an integral part of these financial statements.
27
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1.0 Corporate Information
1.1 Securities Trading Policy
2.0 Summary of significant accounting policies
2.1 Basis of preparation
2.1.1 Basis of Measurement
Portland Paints & Products Nigeria Plc (the Company) has a Securities Trading Policy regulating securities
transactions by its directors and other insiders. The Company’s Securities Trading Policy complies with the
standard set out by the Rules of the Nigerian Stock Exchange are no less stringent than the said standard.
The Company’s Securities Trading Policy is to generally ensure the board members, employees and its
external stakeholders who have knowledge of confidential and potentially price sensitive information are
aware of the prohibition imposed by law against using, disclosing (other than in the normal course of the
performance of their duties) or encouraging transactions in securities on the basis of such inside information.
In addition to obligations imposed by law, the Company wants board members, employees and external
stakeholders to respect the safeguarding of confidential information and potentially price sensitive
information. The Policy has been made available to all stakeholders and is also available on the Company’s
website.
Having made specific enquiry of all directors, the Company confirms that all of its directors have complied
with the standards set out in relevant laws as well as the Company’s Securities Trading Policy.
Portland Paints & Products Nigeria Plc (The Company) was incorporated as a Limited Liability Company on
3 September 1985 and became a Public Company on 24 April 2008. The Company was listed on the floor of
the Nigerian Stock Exchange on 9 July 2009.
The registered office is located at 105A, Adeniyi Jones Avenue, Ikeja, Lagos in Nigeria.
The principal activities of the Company are manufacturing and sale of paints. The main products of the
Company are Sandtex range of decorative and industrial coatings and Hempel marine & protective coatings
for oil and gas sector.
The financial statements of Portland Paints & Products Nigeria Plc ("the Company") have been prepared in
accordance with International Financial Reporting Standards (IFRS) and interpretations issued by the IFRS
Interpretations Committee (IFRS IC) applicable to companies reporting under IFRS. The financial statements
comply with IFRS as issued by the International Accounting Standards Board (IASB).
The financial statements are presented in Nigerian Naira (N), rounded to the nearest thousand, and prepared
under the historical cost convention. The functional currency of the Company' is Nigerian Naira.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the Company’s
accounting policies. The areas involving a higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the financial statements are disclosed in note 2.3
The financial statements have been prepared on a historical cost basis. Transactions in foreign currency are
recognized in naira at the official spot rate at the date of transaction.
28
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.2
2.2.1
2.2.1.1 IFRS 16 - Leases
Lease liabilities
The Company’s leased assets include buildings and land. Lease terms are negotiated on an individual basis
and contain different terms and conditions, including extension options. The lease terms are between 1 and 2
years. On renewal of a lease, the terms are renegotiated. Leased assets may not be used as security for
borrowing purposes.
From 1 January 2019, on adoption of IFRS 16, leased assets are recognised as a right-of-use assets and a
corresponding liability at the date at which the leased asset is available for use by the company is also
recognised. The company elected to use the transition practical expedient allowing the standard to be applied
only to contracts that were previously identified as leases applying IAS 17 and IFRIC 4 at the date of initial
application. The company also elected to use the recognition exemptions for lease contracts that, at the
commencement date, have a lease term of 12 months or less and do not contain a purchase option (‘short-term
leases’). Lease liabilities for leases formerly classified as operating leases were measured at the present value
of the remaining lease payments, discounted using the company’s incremental borrowing rate of 16.17% as at
that date.
At commencement date of a lease, the company recognises lease liabilities measured at the present value of
lease payments to be made over the lease term. The lease payments include the exercise price of a purchase
option reasonably certain to be exercised by the company and payments of penalties for terminating a lease, if
the lease term reflects the company exercising the option to terminate. The variable lease payments that do not
depend on an index or a rate are recognised as expense in the period in which the event or condition that
triggers the payment occurs.
In calculating the present value of lease payments, the company uses the incremental borrowing rate at the
lease commencement date if the interest rate implicit in the lease is not readily determinable. The incremental
borrowing rate is the weighted average interest rate applicable to the company’s general borrowings
denominated in naira during the period. After the commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying
amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the
in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. The lease
term refers to the contractual period of a lease.
The Company has applied the following standards for the first time for their annual reporting period
commencing 1 January 2019:
Changes in accounting policy and disclosures
New and amended standards adopted by the Company
IFRS 16: Leases was issued in January 2016 and became effective for reporting periods beginning on or after
1 January 2019. It replaces the provisions of IAS 17 Leases and IFRIC 4 Determining whether an
arrangement contains a lease. The Company has adopted IFRS 16 from 1 January 2019 using the simplified
transitional approach, and thus has not restated comparative figures for the 2018 reporting period, as
permitted under the specific transitional provisions in the standard. There was no impact on the Company’s
retained earnings at the date of initial application (i.e. 1 January 2019).
The adoption of IFRS 16 resulted in the recognition of right-of-use assets and corresponding lease liabilities
for leases that were formerly classified as operating leases under the provisions of IAS 17, with the exception
of the Company’s shortterm leases, as the distinction between operating and finance leases has been removed.
The impact of the adoption of this standard and the related new accounting policy are disclosed below:
29
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.2
2.2.1
Right of use assets
Impact of adoption
Changes in accounting policy and disclosures (continued)
The Company recognises right-of-use assets at the commencement date of a lease (i.e., the date the underlying
asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and
impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets
includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or
before the commencement date less any lease incentives received. Unless the Company is reasonably certain
to obtain ownership of the leased asset at the end of the lease term, the recognised right-ofuse assets are
depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of-use
assets are subject to impairment
Short-term leases and leases of low value
The Company applies the short-term lease recognition exemption to its short-term leases (i.e., those leases that
have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It
also applies the lease of low-value assets recognition exemption to leases that are considered of low value (i.e.
low value assets). Low-value assets are assets with lease amount of less than $5,000 when new. Lease
payments on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis
over the lease term
The new Leases standard, IFRS 16 replaces the provisions of IAS 17 Leases and IFRIC 4 Determining
whether an arrangement contains a lease. The Company has elected to apply the new standard using the
simplified method.
On adoption of IFRS 16, the lease liabilities as at 1 January 2019 for leases formerly classified as operating
leases were measured at the present value of the remaining lease payments, discounted using the Company’s
incremental borrowing rate as at that date. The Company’s weighted average incremental borrowing rate for
the year was 16.17%.
On adoption of the new accounting standard, the Company elected to apply the following practical
expedients:
• The Company relied on previous assessment of existing lease contracts
• Leases with a remaining lease term of one year with no extension commitments as at 1 January 2019 were
treated as short-term leases.
• The Company excluded initial direct costs in determining the cost of right-of-use assets
• The same discount rate was applied for a portfolio of leases with reasonably similar character
New and amended standards adopted by the Company (continued)
30
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
a)
Amount
without
impact of
IFRS 16
Impact of
IFRS 16
As at Jan 1
2019
N'000 N'000 N'000
ASSETS
Non-current assets
Right-of-use assets - 23,922 23,922
Prepayment - 2,625 2,625
Total non-current assets - 26,547 26,547
Current assets
Prepayment 28,225 (2,625) 25,600
Total current assets 28,225 (2,625) 25,600
Total assets 28,225 23,922 52,148
Non-current liabilities
Lease liabilities - 17,374 17,374
Total non-current liabilities - 17,374 17,374
Current assets
Lease liabilities - 4,416 4,416
Total current liabilities - 4,416 4,416
Total liabilites - 21,790 21,790
The following table summarises the impact of transition to IFRS 16 on the statement of financial position as at
1 January 2019 for each affected individual line item. Line items that were not affected by the changes have
not been included. As a result, the sub-totals and totals disclosed cannot be recalculated from the numbers
provided.
EQUITY AND LIABILITIES
Impact on statement of financial position
31
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.2
2.2.1
Right-of-use assets
N'000
Opening balance as at 1 January
2019 -
Effect of initial application of IFRS
16 26,547
Adjusted opening balance as at 1 January 2019 26,547
Less: depreciation for the period (4,455)
Closing balance as at 31 December 2019 22,092
31-Dec-19 1-Jan-19
N'000 N'000
Building 22,092 26,547
Lease liabilities
N'000
Total undiscounted operating lease commitment as at 31 December 2018 -
Lease liability as at 1 January 2019 23,922
Additions -
Lease payments (6,000)
Add: interest on lease liabilities 3,868
Closing balance as at 31 December 2019 21,790
At 31
December
2019
As at 1
January
2019
N’000 N’000
Non-current 17,374 19,505
Current 4,416 4,416
21,790 23,921
A reconciliation of the Company’s remaining operating lease payments as at 31 December 2018 and the lease
liability as at 1 January 2019 and 31 December 2019 is shown below:
The lease liability as at 1 January 2019 is the total operating lease commitment as at 31 December 2018
discounted using the incremental borrowing rate as at that date.
Short term leases relate to leases of franchisee outlets with contractual lease term of less than or equal to 12
months at the date of initial application of IFRS 16.
The Company’s lease liability as at 1 January 2019 and 31 December 2019 is split into current and non-
current portions as follows:
All the Company’s right-of-use assets are non-current assets. A reconciliation of the Company’s right-of-use
assets as at 1 January 2019 and 31 December 2019 is shown below:
The right-of-use assets recognised as at 1 January 2019 and 31 December 2019 comprised of the following
Changes in accounting policy and disclosures (continued)
New and amended standards adopted by the Company (continued)
32
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
b)
N’000
Depreciation expense (4,455)
Operating profit (4,455)
Finance cost (3,868)
Profit for the year (8,323)
c)
N’000
Depreciation of right-of-use assets
4,455
Interest on lease liabilities 3,868
Net cash flows from operating activities 8,323
d)
Amount
under
IAS 17
Impact of
IFRS 16
Amount
under
IFRS 16
N’000 N’000 N’000
Profit for the period 84,894 (8,323) 76,571
Earnings per share for profit
attributable to the equity
shareholders 0.11 (0.01) 0.10
Impact on earnings per share
As a result of adoption of IFRS 16, the earnings per share of the Company for the year decreased as shown in
Impact on the statement of profit or loss
Impact on the statement of cash flows
33
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.2
2.2.1
e) Impact on deferred taxes
2.3
2.3.1
(a)
(b)
New and amended standards adopted by the Company (continued)
As a result of adoption of IFRS 16, there were no impact on deferred taxes as interest expense on lease
liabilities and depreciation of right-of-use assets give rise to permanent differences for tax purposes.
There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a
material impact on the Company.
Changes in accounting policy and disclosures (continued)
The combined effect of both the following:
- The expected length of time between when the Company transfers the paint to their customers and when
payment is received and;
- The prevailing interest rate in the relevant market.
The advance period is less than 12 months, usually within 30 days. As a result, the effect of discounting will
not be material.
The Company does not expect to have any contracts where the period between the transfer of the promised
goods or services to the customer and payment by the customer exceeds one year. Consequently, the Company
does not adjust any of the transaction prices for the time value of money.
Significant accounting judgements, estimates and assumptions
Impairment of financial assets
Revenue recognition
The loss allowances for financial assets are based on assumptions on default definition and expected loss
rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment
calculation, based on the Company’s past history, existing market conditions as well as forward looking
estimates at the end of each reporting period.
The difference, if any, between the amount of promised consideration and cash selling price and;
The Company has contracts with customers that requirees advance payment to be made before sale of paints
can occur. The Company has considered whether the contract contains a financing component and whether
that financing component is significant to the contract, including both of the following;
The preparation of the Company’s historical financial information requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and
the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these
assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount
of assets or liabilities affected in future periods.
The Company based its assumptions and estimates on parameters available when the financial statements were
prepared. Existing circumstances and assumptions about future developments, however, may change due to
market changes or circumstances arising beyond the control of the Company. Such changes are reflected in
the assumptions when they occur.
Material estimates in the financial statements include the following:
New Standards, amendments and interpretations issued but not yet effective
Significant financing component
34
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.3.1
2.3.2
2.3.3
2.3.4
Revenue recognition (continued)
Significant financing component (continued)
Trademark however has an indefinite useful life as the Company's forecasted sales provides evidence that
Sandtex products will generate net cash inflows for the Company for an indefinite period. Therefore, the
trademark is carried at cost without amortisation, but is tested for impairment annually.
The Company applies the IFRS 9 simplified approach in measuring the expected credit losses (ECL) which
uses a lifetime expected loss allowance for all trade receivables. The expected credit loss rate for this
receivable is determined using a provision matrix approach.
The allowance for doubtful accounts involves management judgment and review of individual receivable
balances based on behavior of customers over the expected life of the receivable and adjusted for forward-
looking estimates of relevant macroeconomic variables. The macroeconomic variables considered include
inflation and gross domestic product (GDP). Additional information on impaired receivables is included in
note 13.
Accounts receivable
Useful life and residual value of property, plant and equipment and definite life intangible assets.
Property, plant and equipment and intangible assets with definite life are depreciated over their useful life.
The Company estimates the useful lives of PPE and intangible assets based on the period over which the
assets are expected to be available for use. The estimation of the useful lives of plant and machinery are based
on technical evaluations carried out on the assets. Estimates could change if expectations differ due to
physical wear and tear and technical or commercial obsolescence.
A certain level of judgement is required for recognition of deferred tax assets. Management is required to
assess the ability of the Company to generate future taxable economic earnings that will utilise the deferred
tax assets. Assumptions over the generation of future taxable profits depends on management's estimates of
future cash flows. This estimate of future taxable income are based on forecast cash flows from operations.
Impairment of intangible assets
Income and deferred tax
The Company is subject to income taxes under the Nigerian tax legislation. Significant judgement is required
in determining the provision for income taxes. There are many transactions and calculations for which the
ultimate tax determination is uncertain. The Company recognises liabilities for anticipated tax audit issues
based on estimates of whether additional taxes will be due.
Management is of the opinion that the trademark is adjudged to have an indefinite life as the ownership had
been transferred to the Company in perpetuity and the Company expects to generate cashflows from the use of
the asset in perpetuity.
Where the final tax outcome of these matters is different from the amounts that were initially recorded, such
differences will impact the current and deferred tax assets and liabilities in the period in which such
determination is made.
It is possible however, that future results of operations could be materially affected by changes in the
estimates brought about by changes in factors mentioned above. The amounts and timing of expenses for any
period would be affected by changes in these factors and circumstances. A reduction in the estimated useful
lives of the plant and machinery would increase expenses and decrease the value of non-current assets.
Externally acquired intangible assets that have indefinite useful lives are initially recognized at cost and are
subsequently tested for impairment at each financial year end or more frequently if events or changes in
circumstances indicate they might be impaired and stated at their recoverable amount (the recoverable amount
is the higher of an asset's fair value less cost of disposal and value-in-use). The impairment loss where the
carrying amount is greater than the recoverable amount is charged to the profit or loss or income statement.
Management is of the opinion that the trademark is adjudged to have an indefinite life as the ownership had
35
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.4 Summary of significant accounting policies
2.4.1 Intangible Assets
Category Useful lives
Trade Mark Indefinite
Computer software 5 years
2.4.2
Intangible assets acquired separately are measured on initial recognition at cost. Intangible assets with finite
lives are amortised over the useful economic life and assessed for impairment whenever there is an indication
that the intangible asset may be impaired. The amortisation period and the amortisation method for an
intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in
the expected useful life or the expected pattern of consumption of future economic benefits embodied in the
asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in
accounting estimates. The amortisation expense on tangible assets with finite lives is recognised in the income
statement as the expense category that is consistent with the function of the intangible assets. Gains or losses
arising from derecognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised in the income statement when the asset is
derecognised.
Intangible assets include purchased trade mark and computer software.
Trade mark is externally acquired with indefinite useful lives. It is recognized at cost and are subsequently
tested for impairment at each financial year end and stated at their recoverable amounts. The impairment loss,
where the carrying amount is greater than the future economic benefits, is charged to the income statement.
Purchased software with finite useful lives are recognised as assets if there is sufficient certainty that future
economic benefits associated with the item will flow to the entity. Amortisation is calculated using the straight-
line method over 5 years.
The assets’ residual values, and useful lives and method of depreciation are reviewed and adjusted, if
appropriate, at each financial year end and adjusted prospectively, if appropriate.
Impairment reviews are performed when there are indicators that the carrying value may not be recoverable.
Impairment losses are recognised within "other income/loss" in the income statement as an expense.
The depreciation base is determined as cost less any residual value. Depreciation is charged on a straight-line
basis over the estimated useful lives of the assets and begins when the assets are available for use.
Cost comprises the cost of acquisition and costs directly related to the acquisition up until the time when the
asset is available for use. In the case of assets under construction, cost comprises direct and indirect costs
attributable to the construction work, including salaries and wages, materials, components and work
performed by subcontractors.
Replacement or major inspection costs are capitalised when incurred and if it is probable that future economic
benefits associated with the item will flow to the entity and the cost of the item can be measured reliably.
Property Plant and Equipment
Land and buildings are initially recognized at cost less any subsequent accumulated depreciation and
accumulated impairment loss for land and buildings. All other property, plant and equipments are initially
recognized at historical cost less accumulated depreciation and accumulated impairment loss.
Computer software primarily comprises external costs and other directly attributable costs.
36
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
Category Useful lives
Long Leasehold Land Over the lease periodFreehold buildings up to 99
yearsFactory Building 50 years
Plant and machinery 5-10 years
Furniture and fittings 3-5years
Motor vehicles 2-4 years
Office/ computer equipments 3-5 years
2.4.3 Assets on lease
2.4.4 Earnings per share
2.4.5 Diluted Earnings per share
2.4.6 Impairment of non-financial assets
2.4.7 Inventories
Raw materials:
Property, plant and equipment and intangible assets are reviewed at each reporting date to determine whether
there is any indication of impairment. If any such indication exists, or in the case of indefinite life intangibles,
then the asset’s (CGU’s) recoverable amount is estimated. For the purpose of measuring recoverable amounts,
assets are grouped at the lowest levels for which there are separately identifiable cash-generating units
(CGUs). The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use (being
the present value of the expected future cash flows of the relevant asset or CGUs). An impairment loss is
recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.
Portland Paints & Products Nigeria Plc evaluates impairment losses for potential reversals when events or
circumstances may indicate such consideration is appropriate. The increased carrying amount of an asset other
than goodwill attributable to a reversal of an impairment loss shall not exceed the carrying amount that would
have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the
asset in prior years.
Inventories are valued at the lower of cost and net realizable value. Cost is determined using the weighted
average method. Costs incurred in bringing each product to its present location and conditions are accounted
for as follows:
Purchase cost on weighted average basis.
Diluted Earnings per share is calculated by dividing the profit attributable to shareholders by the total number
of shares (inclusive of diluted shares).
Finance leases are recognized at amount equal to the fair value of the leased property or if lower the present
value of the minimum lease property, each determined at the inception of the lease.
Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding
liability. The finance charge is allocated to each period during the lease terms so as to produce a constant
periodic rate of interest on the remaining balance of the liability.
An item of property and equipment is derecognised upon disposal or when no further future economic
benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset
(calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is
included in the income statement in the year the asset is derecognised.
Basic earnings are determined by dividing the profit attributable to share holders by the weighted average
number of shares on issue during the year.
37
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
Goods-In-Transit, Work-in-progress and Finished goods:
2.4.8 Financial instruments
(a)
(i)
(ii)
The Company’s financial assets include trade and other receivables, cash and cash equivalents. They are
included in current assets, except for maturities greater than 12 months after the reporting date. Interest
income from these assets is included in finance income using the effective interest rate method. Any gain or
Fair value gains or losses for financial liabilities designated at fair value through profit or loss are accounted
for in profit or loss except for the amount of change that is attributable to changes in the Company’s own
credit risk which is presented in other comprehensive income. The remaining amount of change in the fair
value of the liability is presented in profit or loss. The Company’s financial liabilities include trade and other
payables and interest bearing loans and borrowings.
- Fair value through other comprehensive income: Financial assets in this category are held to collect
contractual cash flows and sell where there are advantageous opportunities. The cash flows represents solely
payment of principal and interest. These financial assets are measured at fair value through other - Fair value through profit or loss: This category is the residual category for financial assets that do not meet
the criteria described above. Financial assets in this category are managed in order to realise the asset’s fair
value.The business model for the Company’s financial assets are held to collect contractual cashflows that are solely
payments of principal (for non-interest bearing financial assets) or solely payments of principal and interest
(for interest bearing financial assets)
Classification and measurement
Financial assets
Goods in transit are valued at invoice price together with other attributable charges.
Work-in-progress cost consist of direct materials and labour and a proportion of manufacturing overheads
based on normal operating capacity but excluding borrowing costs.
The cost of finished goods comprises overheads,suppliers’ invoice prices, and,where appropriate, freight,
printing costs and other charges incurred to bring the materials to their location and condition.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of
completion and the estimated costs necessary to make the sale.
Financial liabilities of the Company are classified and measured at fair value on initial recognition and
subsequently at amortised cost net of directly attributable transaction costs.
The Company’s accounting policies were changed to comply with IFRS 9. IFRS 9 replaces the provisions of
IAS 39 that relate to the recognition, classification. and measurement of financial assets and financial
liabilities; derecognition of financial instruments; impairment of financial assets and hedge accounting. IFRS
9 also significantly amends other standards dealing with financial instruments such as IFRS 7 Financial
Instruments: Disclosures.
It is the Company’s policy to initially recognise financial assets at fair value plus transaction costs, except in
the case of financial assets recorded at fair value through profit or loss which are expensed in profit or loss.
Classification and subsequent measurement is dependent on the Company’s business model for managing the
asset and the cashflow characteristics of the asset. On this basis, the Company may classify its financial
instruments at amortised cost, fair value through profit or loss and at fair value through other comprehensive
income.
Financial liabilities
- Hold to collect: Financial assets in this category are held by the Company solely to collect contractual cash
flows and these cash flows represents solely payments of principal and interest. Assets held under this
business model are measured at amortised cost
The business models applied to assess the classification of the financial assets held by the company are;
38
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.4.8 Financial instruments (continued)
(b)
(c)
(i)
(ii)
(d) Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount is reported in the statement of financial position.
Offsetting can be applied when there is a legally enforceable right to offset the recognised amounts, and there
is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.
The Company derecognises a financial asset when the contractual rights to the cash flows from the financial
asset expire or when it transfers the financial asset and the transfer qualifies for derecognition. Gains or losses
on derecognition of financial assets are recognised as finance income/cost.
Financial liabilities
Recognition of impairment provisions under IFRS 9 is based on the expected credit loss (ECL) model. The
ECL model is applicable to financial assets classified at amortised cost under IFRS 9: Financial instruments.
The measurement of ECL reflects an unbiased and probability-weighted amount that is determined by
evaluating a range of possible outcomes, time value of money and reasonable and supportable information
that is available without undue cost or effort at the reporting date, about past events, current conditions and
forecasts of future economic conditions.
The legally enforceable right is not contingent on future events and is enforceable in the normal course of
business, and in the event of default, insolvency or bankruptcy of the Company or the counterparty.
In line with the Company’s credit risk management practices, a financial asset is defined to be in default when
contractual payments have not been received at least 90 days after the contractual payment period. Subsequent
to default, the Company carries out active recovery strategies to recover all outstanding payments due on
receivables. Where the Company determines that there are no realistic prospects of recovery, the financial
asset, and any related loss allowance is written off either partially or in full.
Derecognition
Financial assets
The Company derecognises a financial liability when it is extinguished i.e. when the obligation specified in
the contract is discharged or cancelled or expires. When an existing financial liability is replaced by another
from the same lender on substantially different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as a derecognition of the original liability and the
recognition of a new liability. The difference in the respective carrying amounts is recognised immediately in
the statement of profit or loss.
Impairment of financial assets
The simplified approach is applied for trade receivables from related parties and third party customers. The
simplified approach requires expected lifetime losses to be recognised from initial recognition of the
receivables. This involves determining the expected loss rates using a provision matrix that is based on the
Company’s historical default rates observed over the expected life of the receivable and adjusted forward-
looking estimates. This is then applied to the gross carrying amount of the receivable to arrive at the loss
allowance for the period.
Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount
of the related financial assets and the amount of the loss is recognised in profit or loss.
39
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.4.9 Cash and cash equivalent
2.4.10 Taxes
Current income tax
Deferred tax
• Sales tax
Revenues, expenses and assets are recognised net of the amount of sales tax, except:
• Receivables and payables are stated with the amount of sales tax included
The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the statement of financial position.
Current income tax assets and liabilities for the current period are measured at the amount expected to be
recovered from or paid to the tax authorities. The tax rates and tax laws used to compute the amount are those
that are enacted or substantively enacted by the reporting date in Nigeria. Current income tax assets and
liabilities also include adjustments for tax expected to be payable or recoverable in respect of previous
periods.
Current income tax relating to items recognised directly in equity or other comprehensive income is
recognised in equity or other comprehensive income and not in the income statement.
Cash and cash equivalents comprise cash at bank and in hand and short-term deposits that are readily
convertible to known aounts of cash and which are subject to an insignificant risk of changes in value with an
original maturity of three months or less in the statement of financial position.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents
as defined above, net of any outstanding bank overdraft.
• Where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation
authority, in which case, the sales tax is recognised as part of the cost of acquisition of the asset or as part of
the expense item, as applicable.
Deferred tax is provided using the liability method in respect of temporary differences at the reporting date
between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are
recognised for all deductible temporary differences, carry forward of unused tax losses.
No deferred tax is recognised when relating to temporary differences that arise from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income
tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each reporting date and are
recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset
to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax items are recognised in correlation to the underlying transaction either in profit or loss, other
comprehensive income or directly in equity.
40
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.4.11 Government grants
2.4.12 Provisions
2.4.13 Revenue recognition
The probability that a customer would make payment is ascertained based on the evaluation done on the
customer as stated in the credit management policy at the inception of the contract. The Company is the
principal in all of its revenue arrangement since it is the primary obligor in most of the revenue arrangements,
has inventory risk and determines the pricing for the goods and services.
Revenue is measured at the fair value of the consideration received or receivable for goods or services, in the
ordinary course of the Company's activities and it is stated net of value added tax (VAT), rebates and returns .
A valid contract is recognised as revenue after;
- Collectability is probable.
- The contract has commercial substance.
Provisions are recognised when there is a present obligation (legal or constructive) as a result of a past event,
it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured on
initial recognition at the present value of management best estimate of the expenditure required to settle the
present obligation at the end of the reporting period. Where the Company expects some or all of a provision to
be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset
but only when the reimbursement is virtually certain.
- The payment terms and consideration are identifiable.
Government grants for expenditure are netted against the relevant expenditures as and when due and these
are recognized in profit or loss in the statement of comprehensive income.
Where retention of a government grant is dependent on the Company satisfying certain criteria, it is
recognized as deferred income. When the criteria for retention have been satisfied, the deferred income
balance is released to the statement of comprehensive income (when related to expenses) or netted against the
asset purchased (when specific to an asset).
When loans or similar assistance are provided by governments or related institutions with an interest rate
below the current applicable market rate, the effect of this favourable interest is regarded as a government
grant.
The expense relating to any provision is presented in the income statement. If the effect of the time value of
money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the
risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of
time is recognised as a finance cost.
- The contract is approved by the parties.
- Rights and obligations are recognised.
41
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.4.13 Revenue recognition
(a)
(b)
('c)
Sale of
Paint
Income
from
executed
projects
Franchise/
Managemen
t fees Total
2,536,897 58,698 14,583 2,610,178
2.4.14 Interest income
The Company recognises revenue from the transfer of goods at a point in time and services overtime in the
following product lines and geographical regions. The Company derives revenue from three major revenue
lines, sale of paint, franchise fees and income from executed projects.
Sale of goods arises from sales of paint products to third parties and related parties. Revenue from the sale of
goods is recognised when the control of the goods are transferred to the buyer. This occurs when the goods
are delivered to the customer or picked up by the customers. This is at a point in time.
Revenue from sale of paint is recognised based on the price specified in the contract, net of the estimated
rebates and returns. Rebates are estimated at the inception of the contract except where the time lag between
the recognition of revenue and granting rebates is within one month.
Returns on goods are estimated at the inception of the contract except where the timing between when the
revenue is recognised and when the returns occur is considered immaterial. In these instances, the returns are
accounted for when they occur.
Revenue from contract with customers
Disaggregation of revenue from contract with customers
Revenue from painting services is recognised as income from executed projects and it is recognised overtime
by measuring the progress towards complete satisfaction of the performance obligation.
The sale-based management fees (royalties) are recognized at the later of when the sale occurs (provided there
is no expectation of a subsequent reversal of the revenue); or the performance obligation to which some or all
of the sales-based royalty has been allocated is satisfied (in whole or in part). An agreed royalty rate (1%) is
charged on the turnover declared by each franchisee quarterly and recognized in the books as
franchise/management fee.
(in thousands)
Sale of goods
Portland transfers control to the customers after the goods have been delivered to the customer, however, the
customer obtains the right to return goods that are bad or damaged after they have been delivered.
Delivery occurs when the goods have been shipped to the specific location, the risks of obsolescence and loss
have been transferred to the customer, and when the customer has accepted the products in accordance with
the sales contract, or the acceptance provisions have lapsed, or the company has objective evidence that all
criteria for acceptance have been satisfied.
Rendering of services
All financial instruments measured at ammortised cost and interest income or expense is recorded using the
effective interest rate (EIR), which is the rate that exactly discounts the estimated future cash payments or
receipts through the expected life of the financial instrument or a shorter period, where appropriate, to the net
carrying amount of the financial asset or liability. Interest income is included in finance income in the income
statement.
42
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2.4.15 Borrowing cost
2.4.16 Foreign currency
2.4.17
2.4.18 Employees' benefits
Employees' benefits both legal and constructive which are long and short term in nature are adequately
recognized in profit or loss and the related liabilities are included in other liabilities in the statement of
financial position.
The Company operates a defined contribution pension scheme in line with the Pension Reform Act 2014. The
total contribution rate is 18%,where the employees contributes 8% and the Company contributes 10% of basic
salary, housing and transport allowances. The Company's contributions are accrued and charged to the income
statement as and when the relevant service is provided by employees. The Company has no further payment
obligations once the contributions have been paid.
Specific borrowing costs on qualifying assets are capitalized from the date the actual costs on the qualifying
asset are incurred. Where such borrowed amount, or part thereof, is invested, the income earned is netted off
the borrowing costs capitalised.
Where the entity does not specifically borrow funds to construct a qualifying asset, general borrowing costs
are capitalized by applying the weighted average cost of the borrowing cost proportionate to the expenditure
on the asset.
The Company’s financial statements are presented in Nigerian Naira, which is also the Company’s functional
currency. Transactions in the foreign currency are recognized in Naira at the official spot rate at the date of
transaction.
Monetary assets and liabilities denominated in a foreign currency are translated into Naira at the spot rate of
exchange ruling at reporting date. Differences arising on settlement or translation of monetary items are
recognised in income statement.
Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are
translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at
fair value in a foreign currency are translated using the exchange rates at the date when the fair value is
determined. The gain or loss arising on translation of non-monetary measured at fair value is treated in line
with the recognition of gain or loss on change in fair value in the item (i.e. the translation differences on items
whose fair value gain or loss is recognised in OCI or profit or loss are also recognised in OCI or profit or loss,
respectively).
Segment reporting
The reportable segments are identified on the basis of Strategic Business Units (SBU) and the threshold of
recognition is a contribution of not less than 10% of the revenue, assets, profits or losses of all the operating
segments. Where the board and management is of the opinion that a strategic business unit is important to the
growth initiative of the Company such SBU may be reported as a reportable segment even though it is not
meeting the threshold of a reportable segment. The Chief Operating Decision Maker (CODM) has been
identified as the executive management.
43
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
3 Segment information:
(a) Income
Decorative
paints
Marine
paints
Sanitary
wares
Management
fees
Total
Dec-19 Dec-19 Dec-19 Dec-19 Dec-19
N'000 N'000 N'000 N'000 N'000
Revenue:
Revenue from contracts with
customers 1,788,941 806,648 6 14,583 2,610,178
Company's revenue per statement
of profit or loss and other
comprehensive income 1,788,941 806,648 6 14,583 2,610,178
Segment gross profit /(Loss) 698,142 248,061 (46) 14,583 960,739
Operating expenses (746,388)
Impairment losses on financial assets (36,616)
Depreciation (65,855)
Amortisation (10,693)
Finance income 11,522
Finance cost (3,868)
Other income 18,354
Sub-total (833,544)
Company's profit before tax 127,195
The Chief Operating Decision Maker (CODM) has been identified as the executive management. The Executive
Management monitors the operating results of each business units separately for the purpose of making decisions
about resource allocation and performance assessment. Segment performance is evaluated based on gross profit or
loss and is measured consistently with gross profit or loss in the combined financial statements.
- Portland decorative paints segment, which manufactures and markets a range of decorative paints.
- Portland marine segment, which manufactures and markets various ranges of marine protective paints.
- Portland sanitary wares segment, which markets and distributes a range of sanitary ware products.
The company derives revenue from the transfer of goods and services overtime and at a point in time. All
revenue are generated in Nigeria.
-Portland services segment which carries out the exceution of painting projects for customers and also earns
income from management fees arising on franchisee agreements.
For management purpose, the Company is organised into Strategic Business Units (SBU) based on products
categories and has three reportable segments as follows:
No other segment has been aggregated to form the above reportable operating segments.
44
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Decorative
paints
Marine
paints
Sanitary
wares
Management
fees
Total
Dec-18 Dec-18 Dec-18 Dec-18 Dec-18
N'000 N'000 N'000 N'000 N'000
Revenue:
Revenue from contracts with
customers 1,810,367 1,000,921 137 17,837 2,829,262 Company's revenue per statement
of profit or loss and other
comprehensive income 1,810,367 1,000,921 137 17,837 2,829,262
Segment gross profit /(Loss) 659,155 400,798 (2,500) 17,837 1,075,290
Operating expenses (746,443)
Impairment losses on financial assets (19,994)
Depreciation (59,366)
Amortisation (10,693)
Finance income 11,799
Finance cost (10,901)
Other income 67,841
Sub-total (767,757)
Company's profit before tax 307,533
The operating segments did not transact with each other and as such there are no transfer prices between operating
segments.
Production activities in the factory is mainly production of decorative paints. Hence the relevant costs are
absorbed by Decorative Paints Segment. This accounts for the depreciation on Factory building wholly absorbed
by Decorative Paints. Other Income is generated from the application of paints in addition to the sales and
marketing of paint products.
The amounts provided to the Chief Operating Decision Maker (CODM) with respect to total assets are measured
in a manner consistent with that of the financial statements. These assets are allocated based on the operations of
the segments and the physical location of the assets.
45
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
(ii) Assets & Liabilities
Decorative
Paints
Marine
Paints
Sanitary
wares Total
Dec-19 Dec-19 Dec-19 Dec-19
N'000 N'000 N'000 N'000
Addition to non-current assets 16,608 38,304 - 54,912
Reportable segment assets 1,536,839 500,047 12,450 2,049,336
Factory office property 188,967 - - 188,967
Total company assets 1,742,414 538,351 12,450 2,293,215
Reportable segment liabilities:
Loans and borrowings (excluding leases
and overdrafts) - - - -
Defined contribution pension scheme 4,543 - - 4,543
Financial liabilities 528,915 - - 528,915
Contact liabilities 17,147 - - 17,147
Deferred tax laibilities - - - -
Other unallocated and central liabilities 97,312 - - 97,312
Total company liabilities 647,917 - - 647,917
Decorative
Paints
Marine
Paints
Sanitary
wares Total
Dec-18 Dec-18 Dec-18 Dec-18
N'000 N'000 N'000 N'000
Addition to non-current assets 57,346 30,022 - 87,368
Reportable segment assets 1,678,313 312,418 10,962 2,001,693
Factory office property 192,429 - - 192,429
Total company assets 1,928,088 342,440 10,962 2,281,490
Reportable segment liabilities:
Loans and borrowings (excluding leases
and overdrafts) (1,974) - - (1,974)
Defined contribution pension scheme 7,817 - - 7,817
Financial liabilities 463,867 - - 463,867
Contact liabilities 55,373 - - 55,373
Deferred tax laibilities 14,048 - - 14,048
Other unallocated and central liabilities 173,382 - - 173,382
Total company liabilities 712,513 - - 712,513
Items of property, plant and equipment are directly allocated to the SBU enjoying the economic
benefits of the assets.
46
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
4 Revenue from contracts with customers
(a) Disaggregation of revenue from contracts with customers
Dec-19 Dec-18
N'000 N'000
Sale of paint 2,536,897 2,787,882
Revenue from executed projects 58,698 23,543
Franchise / Management fees 14,583 17,837
2,610,178 2,829,262
4(b) Liabilities related to contracts with customers
Dec-19 Dec-18
N'000 N'000
Contract liabilities - customer deposits 17,147 55,373
17,147 55,373
Dec-19 Dec-18
5 Other operating income N'000 N'000
Discount received - 10,940
Government grants - 7,742
Profit on sale of property, plant & equipment 1,227 937
Sale of scrap 2,954 2,268
Insurance claim received 1,215 4,315
Exchange gain 1,850 23,397
Other income 11,108 16,134
Container deposit refund - 2,108
Total 18,354 67,841
The company derives revenue from the transfer of goods and services over time and at a point in time in the
following major product lines:
Revenues of approximately N777 million (2017: N624 million) are derived from a single external customer.
The company has recognised the following liabilities related to contracts with customers:
Contract liabilities relate to advance payments from customers and also volume rebates earned by
franchisees both of which can be used as consideration for purchase of goods and services.
No revenue recognised in the current reporting period relates to carried-forward contract liabilities.
47
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Dec-19 Dec-18
6(a) Expense by function N'000 N'000
Cost of sales 1,649,439 1,753,972
Selling & distribution expenses 286,238 264,619
Adminstrative expenses 536,698 551,883
2,472,375 2,570,474
6(b) Expenses by nature
Change in inventories of finished goods and work in progress 1,473,970 1,514,480
Amortization of intangible assets 10,693 10,693
Depreciation on property, plant and equipment 65,856 59,366
Staff costs 477,089 475,203
Distribution costs 88,977 86,865
Repairs and maintenance 45,960 61,180
Energy consumption 23,830 32,730
Advert and promotional expenses 55,126 58,707
Commercial service Fee 27,060 28,078
Auditors' fees 11,900 11,880
** Fees for non - audit services provided by auditor - 2,258
Information technology 48,022 43,172
Rent & rates 23,972 19,951
Bank charges 6,193 6,471
Legal and professional Fees 13,592 22,294
Impairment of non-current assets (note 10) - 3,282
Provisions for legal claims (note 18) - 29,900
Travelling expenses 62,164 62,057
Directors fees 3,050 4,184
Telephone and stationery 6,388 4,792
Other expenses 28,534 32,934
2,472,375 2,570,474
*Change in inventories of finished goods and work in progress relates to movement in finished goods
inventory during the year charged to cost of goods sold.
**Fees for non-audit services provided by auditor relates to expenses incurred in respect of transfer pricing
services and consultancy for implementation of IFRS 9 and IFRS 15 provided by the auditor during the year
(2018: N2.2m).
48
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Dec-19 Dec-18
7 Finance income: N'000 N'000
Interest received on bank deposits 11,522 11,799
Total 11,522 11,799
8 Finance costs:
Interest expense - lease liability 3,868 10,901
Total 3,868 10,901
9 Taxation: Dec-19 Dec-18
(i) Current tax on profits for the year:
Company income tax 62,510 100,608
Education tax 5,458 8,240
67,968 108,848
Deferred tax credit (note 19a) (25,667) (8,008)
Total current tax 42,301 100,840
(ii) Reconciliation of tax charge:
Profit before tax 127,195 307,533
Tax at Nigerian's statutory income tax rates (Minimum tax) 38,159 92,260
Disallowable expenses 52,370 -
Disallowable income (8,662) (284)
Balancing charge 849 634
Effect of permanent difference (20,206) 102
Education tax @2% of assessable profit 5,492 8,240
Others - (112)
Deffered tax (25,667) -
Total tax charge for the year 42,335 100,840
49
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Land
Factory
building
Plant
and
machinery
Office/
computer
equipments
Furniture
and
fittings
Motor
vehicles
Work-in-
progress Total
10 Property, plant and
equipment N'000 N'000 N'000 N'000 N'000 N'000 N'000 N'000
Cost
At 1 January 2018 40,000 173,164 417,630 156,103 28,802 196,510 2,372 1,014,581
Additions - 1 45,170 9,997 2,866 22,800 4,162 84,996
Transfers - - - - 2,372 - (2,372) -
Write off - - (3,282) - - - - (3,282)
Disposal - - - (3,001) (209) (8,775) - (11,985)
At 31 December 2018 40,000 173,165 459,518 163,099 33,831 210,535 4,162 1,084,310
At 1 January 2019 40,000 173,165 459,518 163,099 33,831 210,535 4,162 1,084,310
Additions - - 38,304 6,939 953 8,715 - 54,911
Transfers /Reclassification - - - - - - (1,096) (1,096)
Write off - - - - - - - -
Disposal - - - (3,783) - (18,127) - (21,910)
At 31 December 2019 40,000 173,165 497,822 166,255 34,784 201,123 3,066 1,116,215
Depreciation
At 1 January 2018 - 17,274 283,308 124,440 25,451 143,152 - 593,626
Charge for the year - 3,462 31,276 9,573 3,402 11,653 - 59,366
Disposal - - - (2,572) (130) (7,898) - (10,600)
At 31 December 2018 - 20,736 314,584 131,441 28,723 146,907 - 642,391
At 1 January 2019 - 20,736 314,584 131,441 28,723 146,907 - 642,391
Charge for the year - 3,462 34,117 9,390 3,225 15,662 - 65,856
Write off - - - - - - - -
Disposal - - - (3,780) - (16,375) - (20,155)
At 31 December 2019 - 24,198 348,701 137,051 31,948 146,194 - 688,092
Net book value as at:
At 31 December 2019 40,000 148,967 149,121 29,204 2,836 54,929 3,066 428,123
At 31 December 2018 40,000 152,429 144,934 31,658 5,108 63,628 4,162 441,919
Land and building held for use in the production or supply of goods and services, or for administrative purposes are stated at cost less
any accumulated impairment losses and accumulted depreciation.
Depreciation amounting to N65.9 million (2018:N59.4 million) has been charged to the income statement, N33.8million (2018: N25.5
million) charged to cost of sales, N22.2million (2018: N12.1 million) to administrative expenses and N9.9million (2018: N7.3 million)
to selling and distribution expenses.
There were no borrowing costs capitalised during the year (2018: Nil).
50
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Trade Mark
Computer
Software Total
11 Intangible Assets N'000 N'000 N'000
Cost
At 1 January 2018 49,025 248,644 297,669
Additions - 2,190 2,190
At 31 December 2018 49,025 250,834 299,859
At 1 January 2019 49,025 250,834 299,859
Additions - - -
At 31 December 2019 49,025 250,833 299,859
Amortization:
At 1 January 2018 - 203,724 203,724
Charge for the year - 10,693 10,693
At 31 December 2018 - 214,417 214,417
At 1 January 2019 - 214,417 214,417
Charge for the year - 10,693 10,693
At 31 December 2019 - 225,110 225,110
Net Book values at:
At 31 December 2019 49,025 25,723 74,749
At 31 December 2018 49,025 36,417 85,442
Intangible assets amortization charged to income statement amounts to N10.7m (2018: N10.7million) has
been included as part of administrative expenses.
The Company's trademark represents the N49 million trade mark purchased from Blue Circle Industries
Plc adjudged to have an indefinite life. The trade mark is carried at cost to be tested annually for
impairment.
The trade mark was reviewed for impairment as at 31 December 2019 and at present no impairment is
deemed required and there are no contractual commitment that may have an impact on the carrying value
of the trade mark.
The trademark used to identify and distinguish (Sandtex brands; carrying amount N49million) has an
indefinite life. The Company intends to continue the production of paints in the Sandtex product
categories and evidence supports its ability to do so. An analysis of the Company's forecasted sales
provides evidence that Sandtex products will generate net cash inflows for the Company for an indefinite
period. Therefore, the trademark is carried at cost without amortisation, but is tested for impairment
annually.
51
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Dec-19 Dec-18
12 Inventories: N'000 N'000
Raw materials 233,443 217,476
Packaging materials 29,233 31,357
Work in progress 156 2,986
Finished goods 717,708 537,402
Spare parts 9,490 10,135
Diesel 1,279 4,591
Stock impairment (100,054) (75,900)
Total 891,255 728,047
Dec-19 Dec-18
13 Trade and other receivables N'000 N'000
(i) Trade receivables 596,143 447,789
Less: Provision for impairment of trade receivables - (note 13ii) (238,912) (202,296)
Net trade receivables 357,231 245,493
Other receivables 5,914 57,393
Right of return asset 5,253 9,593
Unutilized withholding tax credit note 31,407 8,630
Less: Provision for impairment of other receivables - - Net other receivables 42,574 75,616
Receivables from related parties (note 22) 5,759 5,286
Less: provision for impairment of receivable from related parties (1,692) (1,692)
4,067 3,594
Withholding tax receivable 50,754 88,614
VAT receivable 57,873 62,863
Total trade and other receivables 512,499 476,180
The amount of write-down on inventories to net realizable value recognised as an expense is N100 million
(2018: N75.9 million). This represents impairment for slow moving, obsolete and damaged inventories. All
inventory items are stated at the lower of cost and their net realisable values.
Year end stock count was conducted across all Company's stock holding locations. The quantity counted
was valued using weighted average costing model as per the Company's policy and agreed as stated herein.
The value of finished goods include N500 million (2018: N312 million) imported merchandizing products.
*Other receivables relates to advance payments made to suppliers.
52
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
13 Trade and other receivables (continued)
Dec-19 Dec-18
N'000 N'000
Trade receivables 357,231 245,493
Receivables from related parties (note 22e) 4,067 3,594
Withholding tax receivable 50,754 88,614
VAT receivable 57,873 62,863
Right of return asset 5,253 9,593
Untilized withholding tax credit note 31,407 8,630
Other receivables 5,914 57,393
Total 512,499 476,180
Dec-19 Dec-18
N'000 N'000
(ii) Allowance for impairment of trade receivables:
At 1 January 2019 202,296 176,905
Increase in impairment losses on transition (Adoption of IFRS 9) - 62,727
202,296 239,632
Additional allowance for receivable impairment 36,616 19,994
238,911 259,626
Amount written off - (57,330)
Total as at 31 Dec 2019 238,911 202,296
(iii) Reconciliation of gross carrying amount of trade receivables Dec-19 Dec-18
N'000 N'000
Gross carrying amount as at 1 January 447,789 433,811
Revenue from contracts with customers 2,599,258 2,823,950
Receipts from customers (2,450,904) (2,752,642)
Receivables written off as uncollectible - (57,330)
Gross carrying amount as at 31 December 596,143 447,789
(iv) Reconciliation of gross carrying amount of related party receivables
Gross carrying amount as at 1 January 5,286 13,171
Revenue from contracts with customers 10,920 5,312
Receipts from customers (10,447) (13,197)
Gross carrying amount as at 31 December 5,759 5,286
Trade receivables are non-interest bearing and are generally on terms of 30-90 days. Trade and other
receivables as at 31 December 2019 were reviewed for impairment.
The fair values of trade and other receivables classified as amortised cost are as follows:
53
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of naira, unless otherwise stated)
Dec-19 Dec-18
N'000 N'000
14 Prepayments
Prepayments - current portion 33,057 22,688
Prepayments - non current portion 1,769 5,537
Total prepayments 34,825 28,224
15 Right of use - Asset
Dec-19 Dec-18
Building N'000 N'000
(i) At 1 January 2019 26,547 -
Additions - -
At 31 December 2019 26,547 -
Accumulated Depreciation
At 1 January 2019 - -
Charge for the year 4,455 -
At 31 December 2019 4,455 -
Carrying amount
At 1 January 2019 26,547 -
At 31 December 2019 22,092 -
15ai Lease liability
Dec-19 Dec-18
N'000 N'000
I January 23,922 - Lease payment c/fwd - -
Payments during the year (6,000) -
Interest on lease liability during the year 3,868 -
31 December 21,790 -
15aiiLease liability(Current & Non Current)
Lease liability - current portion 4,416 -
Lease liability - non current portion 17,374 -
Total Lease Liability 21,790 -
The balance on prepayment represent rent, housing,generator allowances and insurance paid
in advance which will be charged against earnings in the periods it relates.
IFRS 16 affect the accounting for Portland's current operating lease which is the lease of its office premises.
The estimated amount of right-of-use assets of ₦ 26.5million and lease liabilities of ₦ 23.9million was
recognised on adoption of the new standard.
54
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Dec-19 Dec-18
Interest bearing loans and borrowings N'000 N'000
Bank loans:
At 1 January - 43,742
Interest expense in the year - 6,045
Principal repayments in the year - (47,813)
Interest repayments in the year - (1,974)
At 31 December - -
The movement in loan and borrowings represent principal and interest repayment is as follows:
(iii) Government grants:
Dec-19 Dec-18
N'000 N'000
As at 1 January 2019 - 7,742
Total government grant for the year - 7,742
Released to the income statement - (7,742)
- -
16 Cash and cash equivalent:
Dec-19 Dec-18
N'000 N'000
Cash in hand and bank 22,758 326,655
Treasury bills & fixed deposit 256,991 165,000
Cash & short term deposit 279,749 491,655
Cash and cash equivalents 279,749 491,655
For the purpose of the statement of cash flow, cash and cash equivalents comprise the following as at 31
December 2019
Treasury bills & fixed deposit are made for varying periods of between one month and three months
depending on the immediate cash requirements of the Company, and earn interest at the respective short-
term deposit rates. During the reporting period, an expected credit loss assessment was performed on these
balances. The impairment allowance is considered immaterial.
Government grants relates to loan granted by an Agency of the Nigeria Government (Central Bank of
Nigeria) with 6% interest rate which is below the current applicable market rate, the effect of this
favourable interest is regarded as a government grant. There are no unfulfilled conditions or contigencies
attached to these grants.
55
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Dec-19 Dec-18
17 Trade and other payables N'000 N'000
Trade payables 297,608 217,446
Accrued employee benefits 4,833 44,156
Other payables 87,579 86,403
Refund liability (note 17i) 7,985 15,276
Intercompany payable (note21d) 110,901 80,577
Dividends payable (refunded) 20,009 20,009
528,915 463,867
PAYE payable 485 514
Defined contribution pension scheme 4,543 7,817
VAT payable 17,482 28,726
Withholding tax payable 2,064 1,064 Customer deposits - -
Total trade and other payables 553,489 501,988
17(i)
Dec-19 Dec-18
N'000 N'000
At 1 January 2019 15,277 15,277
Addition/(release) (7,292) -
Total refund liability 7,985 15,277
18 ProvisionsDec-19 Dec-18
N'000 N'000
At 1 January 2019 24,917 -
Charge to profit or loss - 29,900
Amount used during the year (9,917) (4,983)
Provisions write back (12,000) -
3,000 24,917
Terms and conditions of the above financial and non-financial liabilities.
Total financial liabilities, excluding loans and borrowings, classified as
financial liabilities measured at amortised cost
Trade payables are non-interest bearing and normally settled on 30 day term.
Other payables and accruals are non-interest bearing and have an average term of 90 days. Dividend payable
represents the total unclaimed dividend as at 31 Dec 2019.
Refund Liability
When a customer has a right to return products bought within a given period, the company recognises a
refund liability for the amount of consideration received for which the entity does not expect to be entitled. At
the same time, the company has a right to recover the products from the customer where the customer
exercises his right of return and recognises an asset.
The recognised provision reflects the directors' best estimate of the most likely outcome of legal
cases against the company based on legal advice from the company's legal counsel
The costs to recover the products are not material because the customers usually return the product
in a saleable condition.
56
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Dec-19 Dec-18
19 Corporate tax liability N'000 N'000
Balance at beginning of the year
Company income tax 109,921 65,805
Education tax 8,240 5,787
118,161 71,592
Current tax expense
Company income tax 62,510 100,608
Education tax 5,458 8,240
186,129 180,440 Withholding tax credit Un - Utilized
Payment (108,848) (62,279)
Income tax payable 77,281 118,161
The analysis of tax payment during the year is as follows:
Cash payment 51,709 44,692
Withholding tax credit Utilized 57,139 17,587
108,848 62,279
19(a)
Dec-19 Dec-18
Deferred tax N'000 N'000
At 1 January 14,048 22,056
Recognised in profit and loss
Tax expense (25,667) (8,008)
At 31 December (11,619) 14,048
Provisions
Property, plant
& equipment
Unrealised
exchange gain Total
Deferred tax (assets)/liabilities N'000 N'000 N'000 N'000
At 1 January 2018 (73,571) 95,627 - 22,056
Charged/(credited) to profit and loss (11,408) 3,400 - (8,008)
At 31 December 2018 (84,979) 99,027 - 14,048
At 1 January 2019 (84,979) 99,027 - 14,048
Charged/(credited) to profit and loss (24,292) (1,375) - (25,667)
At 31 December 2019 (109,271) 97,652 - (11,619)
There are no unrecognised deferred tax assets as at 31 December 2019 (2018:Nil).
Deferred taxes are calculated on all temporary differences using the balance sheet method and a tax
rate of 30% (2018:30%).
Deferred income tax assets and liabilities, deferred income tax charge/(credit) in profit or loss are attributable
to the following items:
57
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
20 Equity
(1) Share capital
Number'000 N'000 Number'000 N'000
Ordinary shares of 50 kobo each 1,000,000 500,000 1,000,000 500,000
Total 1,000,000 500,000 1,000,000 500,000
Issued and
Fully Paid
Issued and
Fully Paid
Issued and
Fully Paid
Issued and
Fully Paid
Dec-19 Dec-19 Dec-18 Dec-18
Number'000 N'000 Number'000 N'000
Ordinary shares of 50 Kobo each at the
beginning of the year 793,416 396,708 793,416 396,708
Rights issue - - - -
As at 31 Dec 2019 793,416 396,708 793,416 396,708
Dec-19 Dec-18
(ii) Share premium N'000 N'000
At 1 January 2019 437,923 437,923
Additions in the year - -
As at 31 Dec 2019 437,923 437,923
(iii) Nature and purpose of reserves:
Dec-19 Dec-18
Other reserves N'000 N'000
At 1 January 2019 91,923 91,923
Revaluation during the year - -
As at 31 Dec 2019 91,923 91,923
Other reserves:
(iv) Earnings per share
The other reserves relates to increases in the fair value of property, plant and equipment and decreases to the
extent that such decrease relates to an increase on the same asset previously recognised in equity. The
revaluation was carried out on land and building in December 2010 and 2012 by Ubosi Eleh & Co., a
professional firm of Chartered Surveyors on an open market basis. However, upon the conversion of the
Company's accounting standard to International Financial Reporting Standards, the cost and revaluation
surplus of the asset was taken as deemed cost and no subsequent revaluations are required in line with the
UACN Plc group accounting policy.
Share premium relates to the excess consideration paid forN 393 million ordinary shares issued in 2017 over
the nominal amount of 50kobo per share. Funds raised from the right issues were used for general working
capital purposes.
Basic earnings per share is calculated by dividing net profit for the period attributable to ordinary equity
holders of the parent by the weighted average number of ordinary shares during the year.
The following reflects the income and share data used on the basic and diluted earnings per share
computations:
Authorised Authorised
Dec-19 Dec-18
58
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
20 Equity (continued)
Dec-19 Dec-18
(iv) Earnings per share (continued) N'000 N'000
Net profit attributable to ordinary equity holders 84,894 206,693
Weighted average number of ordinary shares for basic earnings per share 793,416 793,416
Basic earnings per share (in kobo) 11 26
Weighted average number of ordinary shares for diluted earnings per share 793,416 793,416
Diluted earnings per share (in kobo) 11 26
Dec-19 Dec-18
21 Reconciliation of net profit to net cash generated from operations N'000 N'000
Profit before tax 127,195 307,533
Adjustments to reconcile net income to net cash provided by operating activities:
Dec-19 Dec-18
N'000 N'000
Interest paid 3,868 10,901
Impairment of non-current assets (note 10) - 3282
Provisions for legal claims (note 18) - 29,900
Finance income (11,522) (11,799)
Depreciation charges 65,856 59,366
Depreciation - Right of use asset 4,455 -
Impairment loss recognised in profit or loss (note 13ii) (36,616) (19,994)
WHT credit notes utilized (note 19a) (57,139) (17,587)Interest Expense - Lease Liability - -
Amortization of government grant - (7,742)
Profit on disposal of fixed assets (1,227) (937)
Amortisation of intangible assets 10,693 10,693
(21,632) 56,083
Changes in assets and liabilities:
Increase in trade debtors and prepayments (8,929) (58,046)
Increase in impairment losses on transition (adoption of IFRS 9) - (62,727)
(Increase)/decrease in inventories (163,208) 172,383
Increase in trade creditors & accruals 29,584 4,232
(Decrease)/increase in contract liabilities (38,226) 55,373
(180,779) 111,215
Net adjustment (202,410) 167,298
Net cash provided by operating activities (75,215) 474,831
21.1 Gain/(Loss) on disposal of property, plant and equipment
Proceeds on disposal of property, plant and equipment 2,982 2,322
Less: net book value 1,755 1,385
Gain on disposal of property plant and equipment 1,227 937
59
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
22 Related party transactions
Dec-19 Dec-18
(a) Sales of goods and services Relationship N'000 N'000
UACN Property Development Company Plc Sister company - 2,237
Grand Cereals Limited Sister company 4,243 2,467
Chemical and Allied Products (CAP) Plc Sister company 2,322 -
UAC Foods Limited Sister company 1,716 608
MDS Logistics Ltd Sister company 1,968 -
UAC Resturants Ltd Sister company 670 -
10,920 5,312
Dec-19 Dec-18
(b) Purchases of goods and services N'000 N'000
UAC of Nigeria Plc: Service fee Principal shareholder 27,060 28,078
27,060 28,078
Dec-19 Dec-18
(c) Other transactions with related parties N'000 N'000
UAC of Nigeria Plc Principal shareholder 72,927 48,450
Grand Cereals Limited Sister company - 423
72,927 48,873
Dec-19 Dec-18
(d) Intercompany payable: N'000 N'000
UAC of Nigeria Plc Principal shareholder 99,986 76,528
Grand Cereals Limited Sister company - 1,101
Chemical and Allied Products (CAP) Plc Sister company 10,912 2,736
Livestock Feeds Plc Sister company 3 -
UAC Foods Limited Sister company - 212
110,901 80,577
Dec-19 Dec-18
(e) Intercompany receivable: N'000 N'000
UACN Property Development Company Plc Sister company 2,349 2,237
Grand Cereals Limited Sister company 1,843 2,441
Chemical and Allied Products (CAP) Plc Sister company 11 -
UAC Foods Limited Sister company 1,556 608
5,759 5,286
The parent, ultimate parent and controlling party of the company is UAC of Nigeria Plc incorporated in
Nigeria. There are other companies that are related to Portland Paints & Products Nigeria Plc through
common share holdings and directorship.
All trading balances will be settled in cash.
All related party transactions were carried out on commercial terms and conditions (See also disclosures in
Note 17).
The following transactions were carried out with related parties:
Receivables are largely as a result of sales of paints to related parties. Payables due to related parties are not
as a result of trade transactions but relate to settlement of liabilities and reimbursements for expenses
incurred by related parties on behalf of the Company.
Provisions for doubtful related party receivables as at 31 December 2019 amounted to N1.7 million (2018:
N1.7million) and charges to the income statement in respect of related party receivables is nil. (2018:
N1.7million).
60
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Dec-19 Dec-18
N'000 N'000
23 Compensation to key management personnel:
Short-term employee benefits 22,762 20,382
Long-term employee benefits 1,908 1,325
24,669 21,707
Dec-19 Dec-18
N'000 N'000
The emoluments of the highest paid director 24,669 21,707
Emolument of non-executive directors:
Fee 375 913
Sitting allowance 2,675 2,575
Passage Allowance 30,171 -
33,221 3,488
Directors' mix Dec-19 Dec-18
Number Number
Executive Director 1 1
Non-executive Directors 4 5
5 6
24 Employee compensation
Dec-19 Dec-18
Number Number
Production 12 37
Sales, marketing and depot 36 46
Administration 29 28
77 111
Dec-19 Dec-18
Number Number
N10,000 - N500,000 - -
N500,001 - N1,000,000 - 31
Above N1,000,001 77 80
77 111
The amounts disclosed above are the amounts recognised as an expense during the reporting period related to
key management personnel (The Executive Directors). The Executive Director is paid salaries and housing
allowance, transportation is also provided for him. While the Non-executive Directors are only entitled to
Directors Fees, sitting and passage allowance. The Executive Director is entitled to a defined contribution plan
(pension) in accordance with Pension Reform Act 2004. But non-executive Directors are not entitled to any
form of pension or post employment benefits with the company. Amounts paid to Directors are disclosed
below:
The average number of persons employed by the Company during the year, including Director, is as follows:
The number of employees in respect of emoluments within the following ranges was:
61
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
24 Employee compensation (continued)
Dec-19 Dec-18
The aggregate cost of these employees were: N'000 N'000
Salaries and wages 295,951 334,757
Director's fees (note 23) 33,221 3,489
Defined contributions 20,479 22,203
Staff training expenses 2,097 8,430
Other employment related expenses 125,341 106,324
477,089 475,203
Cost of sales 87,733 93,860
Selling & distribution expenses 94,601 75,424
Adminstrative expenses 294,755 305,919
477,089 475,203
25 Financial risk management
Staff costs have been recognised in the "statement of profit or loss and other comprehensive income" as
follows:
Portland Paints & Products Nigeria Plc’s principal financial assets comprise trade and other receivables,
cash and short term deposits that arise directly from its operations. The Company’s principal financial
liabilities comprise of trade and other payables. The main purpose of these financial liabilities is to finance
and to provide guarantee to support the Company’s operations.
Portland Paints & Products Nigeria Plc is exposed to credit risk, liquidity risk and market risk. The
Company’s board has overall responsibility to oversee the management of these risks. The Company’s
Board of Directors is supported by a risk management and governance committee that is responsible for
developing the Company’s Corporate Governance policies and practices and to consider the nature, extent
and category of risks facing the Company.
The overall objective of the Board is to set policies that seek to reduce risk as far as possible without
unduly affecting the Company’s competitiveness and flexibility.
The Board of Directors reviews and agrees policies for managing each of these risks which are summarised
below:
62
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
25.1 Credit risk
The concentration of the Company's credit risk is as follows:
Item
Total gross
amount
Fully
performing
Past due but
not impaired Impaired
N'000 N'000 N'000 N'000
Trade receivables 596,143 288,329 68,902 238,912
Receivables from related companies 5,759 4,067 - 1,692
Cash and cash equivalent 279,749 279,749 - -
881,651 572,145 68,902 240,604
Item
Total gross
amount
Fully
performing
Past due but
not impaired Impaired
N'000 N'000 N'000 N'000
Trade receivables 447,789 144,648 102,537 200,604
Receivables from related companies 5,286 3,594 - 1,692
Cash and cash equivalent 491,655 491,655 - -
944,730 639,897 102,537 202,296
Dec-19 Dec-18
Age analysis of past due but not impaired receivables N'000 N'000
52,227 34,708 16,675 67,829
68,902 102,537
(a) Trade receivables
31 December 2018
91 - 180 days181 - 360 days
Credit quality of the customer is assessed based on an extensive credit rating scorecard and individual
credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly
monitored by the credit committee comprising of sales, finance and internal audit and the Company intends
to explore issuing of issurance certificates to major distributors and customers.
This is the risk of financial loss to the Company if a customer or counterparty to financial instrument fails
to meet its Contractual obligations. The Company is mainly exposed to credit risk from credit sales. It is
Company policy, implemented locally, to assess the credit risk of new customers before entering contracts.
31 December 2019
63
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
25.1 Credit risk (continued)
(a) Trade receivables (continued)
Counterparties with external credit ratings: Dec-19 Dec-18
N'000 N'000
193,781 81,551
193,781 81,551
Counterparties without external credit ratings: Dec-19 Dec-18
N'000 N'000
21,852 134,082
72,249 114,880
308,261 117,276
402,362 366,238
The Company defines the rating as follows:
Trade receivables
Group 1
Total
Trade receivables
Group 1
Group 2
Group 3
Total
Group 1 – These are balances with Blue Chip, Listed and other large entities with a low chance of default.
Group 2 - These are balances with small – medium sized entities with no history of defaults.
Group 3 – These are balances with small entities and also medium sized entities with history of defaults or
late payments.
The entity has adopted a policy of only dealing with credit worthy counter-parties and a credit committee is
instituted which comprises of sale, finance and internal audit department to review the outstanding balances
on customers’ account. Insurance certificate is required before credit is granted to key distributors. Trade
receivables consist of a large number of customers, spread across diverse industries and geographical areas.
On-going credit evaluation is performed on the financial conditions of account receivable and where
appropriate, credit guarantee insurance cover is purchased.
Portland Paints & Products Nigeria Plc has 25% of it's credit risk exposure to a single key customer.
Apart from this key customer, the entity does not have significant credit risk exposure to any single
counterparts or any group of counterparties having similar characteristic. Concentration of credit risk to any
other counterparty did not exceed 5% of gross monetary assets at any time during the year.
The credit risk on liquid funds is limited because the counterparties are banks with high credit-rating
assigned by international credit-rating agencies.
64
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Sensitivity of estimates used in IFRS 9 ECL
Estimation uncertainty in measuring impairment loss
(a)
2019
N’000
Increase/decrease in estimated cash flows
+20% 42,036
-20% (38,439)
-10% Held constant 10%
N’000 N’000 N’000
+10% 57,062 54,928 52,795
Held constant 2,134 - (2,133)
-10% (119,719) (124,945) (130,172)
In establishing sensitivity to ECL estimates for trade receivables from customers and related parties, three
variables (GDP growth rate, unemployment rate, Inflation rate) were considered. Of these variables, the
Company's receivables portfolio reflects greater responsiveness to GDP growth rate and inflation rates.
The table below shows information on the sensitivity of the carrying amounts of the Company’s financial
assets to the methods, assumptions and estimates used in calculating impairment losses on those financial
assets at the end of the reporting period. These methods, assumptions and estimates have a significant risk
of causing material adjustments to the carrying amounts of the Company’s financial assets.
Effect on profit
before tax
-
-
Expected cash flow recoverable from trade receivables:
The table below demonstrates the sensitivity to a 20% change in the expected cash flows from trade
receivables, with all other variables held constant:
The table below demonstrates the sensitivity to a 20% change in the expected cash flows from trade
GDP growth rate
This table shows the sensitivity of the expected credit loss to an inverse and positive change to each
forward-looking macro variables, with all other variables held constant:
Inflation Rate
Effect on other components
of profit before tax
2019
N’000
65
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
(b) Cash and short term deposit
Counterparties with external credit ratings:
Dec-19 Dec-18
N'000 N'000
- 6,866
8,438 9,149
58,102 7,666
810 53,584
- -
206,231 410,634
- -
B 5,571 2,683
CCC - 827
597 246
279,749 491,655
'AA' A financial institution of very good financial condition and strong capacity to meet its obligations as
and when they fall due. Adverse changes in the environment (macro-economic, political and regulatory)
will result in a slight increase the risk attributable to an exposure to this financial institution. However,
financial condition and ability to meet obligations as and when they fall due should remain strong.
'A' A financial institution of good financial condition and strong capacity to meet its obligations. Adverse
changes in the environment (macro-economic, political and regulatory) will result in a medium increase in
the risk attributable to an exposure to this financial institution. However, financial condition and ability to
meet obligations as and when they fall due should remain largely unchanged.
BBB+
BBB-
BBB
Unrated
Total
Counterparty credit limits are reviewed by the Company’s Board of Directors on an annual basis, and may
be updated throughout the year subject to approval of the Managing Director. The limits are set to minimise
the concentration of risks and therefore mitigate financial loss through potential counterparty’s failure.
Portland Paints’ maximum exposure to credit risk for the components of the statement of financial position
at 31 December 2019 and 2018 is the carrying amounts.
Cash and short term deposits
AA
AA-
AA+
A+
Credit risk from balances with banks and financial institutions is managed by the Portland Paints’ treasury
department in accordance with the Company’s policy. Investments of surplus funds are made only with
approved counterparties and within credit limits assigned to each counter party.
66
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
25.1 Credit risk (continued)
25.2 Liquidity risk
CCC' There is substantial credit risk and default is a real possibility. Failure of the bank is a real
possibility. The capacity for continued unsupported operation is highly vulnerable to deterioration in the
business and economic environment.
This is based on Fitch ratings.
This is the risk arising from the Company’s management of working capital and the finance charges and
principal repayments on its debt instruments. It is the risk that the Company will encounter difficulty in
meeting its financial obligations as they fall due.
The Company policy is to ensure that it will always have sufficient cash to allow it meet its liabilities when
they become due. Ultimate responsibility for liquidity risk management rests with the Board of Directors,
which has established an appropriate liquidity risk management framework for the management of the
entity’s short, medium and long-term funding and liquidity requirement. The entity manages liquidity risk
through the use of bank overdrafts and bank loans. The company has agreement with our bankers to
provide overdraft facilities for short term funds requirement and long-term borrowing facilities, by
continuously monitoring forecast and actual cash flow and matching the maturity profile of financial assets
and liabilities.
'BBB' A financial institution of satisfactory financial condition and adequate capacity to meet its
obligations as and when they fall due. It may have one major weakness which, if addressed, should not
impair its ability to meet obligations as and when due. Adverse changes in the environment (macro-
economic, political and regulatory) will result in a medium increase in the risk attributable to an exposure
to this financial institution.
'BB' Financial condition is satisfactory and ability to meet obligations as and when they fall due exists.
May have one or more major weaknesses. Adverse changes in the environment (macro-economic, political
and regulatory) will increase risk significantly.
'B' Financial condition is weak but obligations are still being met as and when they fall due. Has more than
one major weakness and may require external support.
The modifiers "+" or "-" may be appended to a rating to denote comparative position within the rating
categories.
67
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
25.2 Liquidity risk (continued)
31 December 2019
Less than 3
months
Between 3
months and 1
year
Between 1
and 5 years Over 5 years
Borrowings - - - -
Trade and other payables 528,915 - - -
Total 528,915 - - -
31 December 2018
Borrowings - - - -
Trade and other payables 463,867 - - -
Total 463,867 - - -
25.3 Market risk
25.4 Interest rate risk
Other payables excludes withholding tax payable and customer deposits (see note 17) as these are non financial instrument.
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of changes in market prices. The activities of the entity are exposed primary to the following
market risks; interest rate risk, foreign currency risk and commodity price risk.
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will flunctuate
because of changes in market interest rates. The company’s exposure to the risk of changes in market
interest rates relates primarily to the company’s short-term debt obligations with floating interest rates.
The company interest rate risk arises from short term deposits and borrowings held at fixed rates. The
Company does not carry any borrowings at fair value and as such is not exposed to fair value risk.
The balances below are undiscounted amounts and are based on contractual cashflows.
68
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
Concentration of interest risks is as follows:
Weighted
average
interest rate
Interest
bearing
balance
Fixed rate
Non interest
bearing
% N'000 N'000
Financial assets:
Trade and other receivables - - 361,298
Cash and bank balances - 256,991 22,758
Total 256,991 384,056
Financial liabilities:
Borrowings - - -
Trade and other payables - - 528,915
Total - 528,915
Weighted
average
interest rate
Interest
bearing
balance
Non interest
bearing
%
Fixed rate
N'000 N'000
Financial assets:
Trade and other receivables - - 249,087
Cash and bank balances - - 326,655
Short term deposits - 165,000 -
Total 165,000 575,742
Financial liabilities:
Borrowings - - -
Trade and other payables - - 463,867
Total - 463,867
31 December 2019
31 December 2018
69
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
25.5 Foreign currency risk
Naira USD GBP Total
N'000 N'000 N'000 N'000
Financial assets:
Trade and other receivables 180,425 180,873 - 361,298
Cash and short term deposits 45,895 233,043 811 279,749
Total 226,319 413,916 811 641,047
Financial liabilities:
Trade and other payables 278,629 102,657 36,727 418,013
Inter-company payables 110,901 - - 110,901
389,531 102,657 36,727 528,915
Naira USD GBP Total
N'000 N'000 N'000 N'000
Financial assets:
Trade and other receivables 136,572 112,515 - 249,087
Cash and short term deposits 228,277 263,374 4 491,655
Total 364,849 375,889 4 740,742
Financial liabilities:
Trade and other payables 366,430 16,860 - 383,290
Inter-company payables 80,577 - - 80,577
Total 447,007 16,860 - 463,867
31 December 2018
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in foreign exchange rates. The company’s exposure to the risk of changes in
foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense is
denominated in a different currency from the Company’s functional currency). In preparing the financial
statement of the entity, transactions in currencies other than the entity’s functional currency [foreign
currencies] are recognized at the rates of exchanges prevailing at the date of the transactions. The company
is not managing its foreign currency risk by hedging because the entity’s dealing in foreign currencies is
minimal and will not have material effect on the financial statements of Portland Paints & Products Nigeria
Plc.
31 December 2019
70
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
26 Capital management
Dec-19 Dec-18
- -
1,582,204 1,536,981
Total capital 1,582,204 1,536,981
0% 0%
27 Commitments and contingencies
Capital commitments
28 Events after reporting period
At 31 December, 2019 the Company did not have any capital commitments (Dec 2018: Nil).
In the first quarter of 2020, there was a COVID -19 outbreak which has spread globally. The outbreak has
been declared a Public Health Emergency of International concern by World Health Organisation (WHO)
in March 2020. As at the date of this report, several cases have been confirmed in Nigeria by the Nigerian
Centre for Disease Control.
Interest bearing debt
Equity
Gearing ratio
Management considers capital to consist only of equity as disclosed in the statement of financial position.
The primary objective of the Portland Paints capital management is to ensure that it maintains a healthy
capital ratio that support its business and maximize shareholder value. The company manages its capital
structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust the
capital structure, the Company may adjust the dividend payment to shareholders or issue new shares.
No changes were made in the objectives, policies or processes for managing capital during the year ended
31 December 2019. In order to ensure an appropriate return for shareholder’s capital invested in the
company, management thoroughly evaluates all material projects and potential acquisitions before
approval. The company is not subject to any capital restriction requirements.
The company monitors capital using a gearing ratio, which is interest bearing debt divided by total capital
plus interest bearing debt. The company’s policy is to keep the gearing ratio between 0% and 50%.
Item
The disease has caused a significant reduction in social interaction, with a shutdown of public facilities and
physical interaction. Measures taken to contain the virus have affected economic activity. The slowdown in
the global and Nigerian economy, coupled with global crude oil price declines and pressure on the Naira is
expected to impact disposable income and in turn consumer demand for decorative, industrial and marine
paint.
71
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DEC 2019
(All amounts are in thousands of Naira, unless otherwise stated)
28 Events after reporting period (continued)
In the light of these recent developments and its underlying impact on revenue (due to reduced demand for
products), increase costs (given imported products and expected inflationary pressures). However, detailed
estimate cannot be made now given the uncertainty about the extent and duration of the pandemic.
Management has also considered the potential implications of this outbreak and have put in place measures
to mitigate against a significant impairment of the carrying value of assets. The management is confident
that there are no plans to liquidate any of the Company's operations or to cease trading. Management is
confident that we can manage liquidity and remain a going concern.
However, its reasonably possible, based on existing knowledge, that outcomes within the next financial
year that are different from assumptions used for some estimates and judgement, could require a material
adjustment to the carrying amount of the asset or liability affected.
72
PORTLAND PAINTS & PRODUCTS NIGERIA PLC
STATEMENT OF VALUE ADDED
FOR THE YEAR ENDED 31 DECEMBER 2019
Dec-19 Dec-18
N'000 % N'000 %
Turnover 2,610,178 2,829,262
Non trading items 29,876 79,640
2,640,054 2,908,902
Bought-in-material and services:
- Local (1,502,572) (1,603,601)
- Imported (423,802) (452,298)
Value added 713,680 100% 853,003 100%
Applied as follows:-
To pay employees:
Salaries and labour related expenses 477,089 67% 475,203 56%
To pay Government:
Corporate tax 67,968 10% 108,848 13%
To pay provider of capital:
Interest charges 3,868 1% 10,901 1%
To pay shareholders
as dividend 39,671 6% - 0%
Retained for replacement of assets and business growth:
- Depreciation 65,856 9% 59,366 7%
- Deferred tax (25,667) -4% (8,008) -1%
- Profit for the year 84,894 12% 206,693 24%
713,680 100% 853,003 100%
Value added represents the additional wealth which the company has been able to create by its own and its employees' efforts.
This statement shows the allocation of that wealth to employees, providers of capital, government and the portion retained for
the future creation of more wealth.
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PORTLAND PAINTS & PRODUCTS NIGERIA PLC
FIVE YEAR FINANCIAL SUMMARY
FOR THE YEAR ENDED 31 DECEMBER 2019
2019 2018 2017 2016 2015
N’000 N’000 N’000 N’000 N’000
Statement of financial position:
Property, plant & equipment 428,123 441,919 420,955 438,083 456,202
Intangible asset 74,749 85,442 93,945 49,025 124,685
Right of use asset 22,092 - - - -
Deferred tax asset 11,619 - - - -
Non-current prepayments 1,769 5,537 3,245 13,402 10,789
Net current assets 1,061,227 1,018,131 896,926 260,019 252,858
Non-current liabilities:
Borrowings - - - (43,492) (101,571)
Government grants - - - (7,728) (32,240)
Deferred taxation - (14,048) (22,056) (9,095) (19,106)
Lease liabilites (17,374) - - - -
1,582,204 1,536,981 1,393,015 700,214 691,617
Shareholders’ funds:
Issued share capital 396,708 396,708 396,708 200,000 200,000
Share premium 437,923 437,923 437,923 - -
Other capital reserve 91,923 91,923 91,923 91,923 91,923
Retained earnings 655,650 610,427 466,461 408,291 399,694
1,582,204 1,536,981 1,393,015 700,214 691,617
Statement of comprehensive income
Revenue 2,610,178 2,829,262 2,316,289 1,844,050 2,771,147
Profit/(loss) before taxation 127,195 307,533 123,868 7,502 (258,369)
Taxation (42,301) (100,840) (65,698) 1,094 25,384
Profit/(loss) after taxation 84,894 206,693 58,170 8,596 (232,985)
Dividend declared per share - 0.05 - - -
Per share data (kobo)
Earnings /(loss) per share – Basic 11 26 8 2 (58)
Diluted earnings per share 11 26 8 2 (58)
Note:
Earnings per share is based on profit after taxation and the number of issued and fully paid ordinary shares at the end of
each financial year.
74