Board Chair Charles Bernard Ntim (middle), Kofi Owusu Boateng (Second from right) and other board members of the PBC
The total revenue of PBC limited for the 2017 financial year increased from GH¢1.891 billion to GH¢2.360 billion, representing an increase of 24.8 percent, but it recorded a net loss of GH¢22.442 million as against GH¢15.924 million in the previous year.
Charles Bernard Ntim, Board Chairman, who disclosed this to shareholders on Wednesday in Accra at its Annual General Meeting (AGM) in Accra, explained certain key factors that contributed to the dwindling fortunes of the company.
These, according to him, include the reduction in competitive buyers’ margins, which resulted in lower revenue, an increase in operating cost in the midst of general price level increase of inputs and other logistics, write-off of shea-nut found to have high free fatty acid (FFA) due to the long period of storage, and lack of adequate and timely funding for cocoa purchases which led to lower than expected purchases which impacted revenue for the year.”
Mr Ntim said total operational and administrative expenditure increased by 37 percent from GH¢121.503 million to GH¢166.595 million due principally to a general increase in the price of inputs, logistics and other administrative costs.
“Finance costs continued to take a heavy toll on the company’s finances. Inspite of a slight reduction of finance cost by 4 percent from GH¢110.305 million to GH¢105.794 million, it constituted about 45.7 percent of the company’s total gross earnings.
“It is noteworthy that the company’s operating profit before financing cost, which has always been significantly positive, was whittled away by the huge finance cost leading to financial loss.
“As per the consolidated accounts, the financial position of PBC Limited and its subsidiary Golden bean Hotel show a net loss of GH¢29.876 million.”
He stated that the PBC’s purchases increased by 12.78 percent from 240,297 tonnes in 2015/2016 to 271,000 tonnes during the 2016/2017 year, with the company achieving a market share of about 27.8 percent in 2016/2017 compared to 31.0 percent in 2015/2016.
Chief Executive Officer (CEO) of the company, Kofi Owusu Boateng, in an address, said key financial indicators of PBC’s activities continued to reduce in line with the significant decrease in its level of profitability and financial state.
Basic earnings per share (EPS) decreased by 140.8 percent from GH¢0.0333 to GH¢0.0469; return on capital employed increased from 453 percent to 21.6 percent due to the enhancement of the equity through a surplus from assets revaluation and the balance sheet showed a significant increase in shareholders’ equity from GH¢3,317,197 to GH¢103,536,403 due to the revaluation reserves of GH¢122,417,938 earned from the revaluation of the company’s assets in the year under review.
Mr Boateng stated that following the abysmal performance of the company, management and board appointed Messrs Ernst & Young, a management consultancy firm, to assess the business operating model of PBC.
By Samuel Boadi & Ebenezer Gyamerah