Our vision is to be market leaders in our various business sectors, delivering excellent customer services and returns to shareholders well above the industry standard.
GENERAL
Fellow shareholders, this year is a significant one for us and it is my pleasure to congratulate you on another successful year as we collectively celebrate our Company's golden jubilee. I welcome you to the 50 th annual general meeting.
BUSINESS ENVIRONMENT
The country recorded some remarkable achievements on the economic front in 2006.
Nigeria finally secured debt relief from the Paris Club of Creditors which led to a reduction in the country's external debt profile.
The Nigeria Population Commission eventually conducted a census exercise after previous postponements. It is for the nation to continue to live by the positive effect of our probable population figure through enumeration and not by the dispute from it.
The banking sector witnessed an aggressive expansion drive through opening more branches locally and in the West Coast of Africa. Many banks went to the capital Market to raise funds to back up their share capital base and qualify for the management of the nation's foreign reserves. Others also took up foreign technical partners for this purpose.
Interest rates were stable while the naira appreciated slightly against the US dollar. In the second quarter of 2006, the CBN announced the liberalization of the foreign exchange market with 100% increase in personal and business travel allowance.
The introduction of the ECOWAS Common External Tariff resulted in the reduction of import duties on vehicles generally.
The poor state of public infrastructure particularly roads, water and electricity supply continue to be a cause for concern. The situation has been worsened by continued crises in the Niger Delta which has culminated in the vandalisation of oil pipelines, abductions of expatriate workers and disruptions of oil products supply thereby resulting in shortfalls in revenue projections and electricity generation/distribution.
BUSINESS REVIEW
Before introducing the results, I wish to briefly review the performance of the respective business units of the Company.
Briscoe Toyota
The Toyota motor business had a good year having recorded a significant increase in the sales of Toyota motor vehicles including improved patronage of the motor workshops. A new Toyota sales and service outlet was opened on September 1, 2006 at Victoria Island , thereby improving the customer service network. The name of the unit will be changed shortly to BriscoeToyota to reinforce the Toyota brand in the minds of customers and underscore the close cooperation of the two brands for over 40 years now. The launch of the new name will take place in March during the activities to commemorate the 50th anniversary.
Briscoe Ford
The performance of Briscoe Ford was quite impressive as it contributed over 10% to the income of the motor business after only one year of operations. A model launch in August 2006, including the choice of a Ford Explorer as the official vehicle for the popular Gulder Ultimate Man Search Promotion generated a lot of public awareness. Ford is steadily carving a niche for itself in the market especially in the commercial vehicles sector where the Ford Ranger and Everest are becoming popular. To bring our services closer to our customers, an additional facility is to be constructed along the Lekki express road. Land has been acquired for this purpose and construction is expected to commence in the second quarter of the year.
Briscoe Solutions Plus
The Atlas Copco unit of the division which deals in industrial air compressors, generators and other technical equipment exceeded its performance in 2005. infrastructure maintenance services for companies in the telecommunications sector earned the Company additional income of N503.
Briscoe Properties
The business activities of Briscoe Properties Limited, our associate Company recorded significant growth in 2006. Facility Management services accounted for a substantial portion of the income generated. This activity is quite profitable and has a lot of potentials, as there is a large untapped market with very few capable firms in the industry. There is also a growing awareness of maintenance habits by property owners (commercial and residential), including the need to maximize long-term value of properties and achieve high tenant retention through the use of efficient professional maintenance services.
RESULTS
The Company's turnover and profit after tax of N13.2b and N531.8m in 2006 significantly exceeded its performance in 2005 by 70% and 166% respectively.
DIVIDEND AND SCRIP ISSUE
Your Board has recommended a divided of 50 kobo per share, amounting to N181.5 million, to shareholders for approval at the AGM subject to the appropriate withholding tax. The dividend recommended is an increase of 43% over that declared last year. In addition, a scrip issue of one new share for every four held is also recommended.
In this course of the year, shareholders recorded significant capital appreciation as the Company's share price increased by over a 100%, having commenced the year at N7.00 and closed at N14.89. as the Company's shares were more actively traded in 2006 than in previous years, a sizeable number actually realized the capital gains made.
DIRECTORS
Mr. Akinbiyi Oloko, the director responsible for the Briscoe Solutions Plus Division resigned from the board with effect from July 24, 2006 . on behalf of your board, I wish him success in his future endeavours. At this meeting, Mr. A.Alli and my humble self will be retiring by rotation and being eligible would be offering ourselves for re-election.
Meristem Registrars Limited, a firm whose operations are Information technology driven with a fast response time to enquiries including a team of competent professionals, was in the first quarter of 2007 appointed as Registrars of the Company. Their staff will be officiating at the next AGM.
FUTURE PROSPECTS
R.T. Briscoe certainly has a promising future ahead of it as we look forward to commemorating our 50th anniversary in March. The Company has a chequered history, and against all odds has overcome a number of trying moments over the years to bounce back to reckoning. This explains briefly the back drop for our golden jubilee anniversary which is “Resilience, Value, Innovation”. The anniversary falls on the 9th of March, 2007 and will be celebrated with a week long event of activities.
To take the company to a higher level; in the years to come, sustain growth and create value for shareholders, the board with the active participation of the management and staff of the Company has evolved a new vision for the future: Our vision is to be market leaders in our various business sectors, delivering excellent customer services and returns to shareholders well above the industry standard. A corollary of this is our current focus to expend current business activities and diversify into other promising sectors of the economy.
CONCLUSION
Our Company had the privilege of winning for the 11th and 4th consecutive time since 2002, the Nigerian Stock Exchange Annual President's Merit Award for the 2005 financial year in the Automobile & Tyre category. We remain grateful for this honour and do assure all our stakeholders that matters of corporate governance particularly financial reporting, will continue to be given the utmost priority such deserves.
In conclusion, I wish to thank to the members of the Board, Management and staff of the Company for the good performance recorded this year. I also wish to thank our customers and business associates without whose support the results could not have been achieved.
I wish you all a pleasant AGM.
Clement Adekunle Olowokande
CHAIRMAN
Lagos , Nigeria
February 22, 2007 .
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