The Board Chairman of Unilever Ghana Ltd. Mr Ishmael Yamson has assured shareholders of the company that the 2010 fiscal year will bring them increased dividends.

Announcing a dividend of GH¢0.2128 per share for 2009, at an Annual General Meeting in Accra, Mr Yamson said the company had braved the odds in 2009, a difficult year on several fronts, and maintained the dividend at the 2008 level.

That, according to him, is consistent with Unilever’s resolve to keep its shareholder’s happy and keep to its “practice of consistent payment of dividends. Despite the challenges in the year and reduced earnings, the dividend is recommended to be paid from accumulated income surplus and a healthy cash position.”

Giving an overview of the year 2009, the Board Chairman said while the country has continued to enjoy political stability, the simmering tensions between the two major political parties – the NPP and NDC – remained. Such tensions, he advised, must not be allowed to “divert attention from the major challenges facing the country, and undermine the effort needed to sustain an investor-friendly political environment.”

On the economic front, Mr Yamson said “the impact of the global financial crisis began to be more directly felt as offshore credit became more difficult to source while capital flight re-surfaced, with greater impact on the Ghana Stock Exchange. Moreover the weak fiscal management which resurfaced in 2006, began to inflict severe pressures on the economy".

Mr Yamson said it was commendable that the government adopted measures that ensured significant levels of stability in the economy and a reduction in inflation.

“It is, however, clear that while the stabilization measures have succeeded in restoring sanity into the economy, they have nonetheless created serious problems for the economy and for businesses.

“Growth has stalled and unemployment has grown. Disposable incomes have shrunk and consumer purchasing power has weakened. While, according to the Bank of Ghana's Monetary Committee Report published last month, business confidence rose by 1.2% in June this year, consumer confidence was at the same time reported to have declined by 5.2%. Besides, the economy is yet to absorb fully the impact of the recent steep increase in utility tariffs and before then the upward adjustment in petroleum prices.”

To enhance growth and productivity, the Board Chairman proposed “the rapid creation of efficient, reliable, effective and competitively priced infrastructure while ensuring that Ghanaian industry is not made to pay for the inefficiencies of public sector service providers, such as water and electricity.”

He believes that “sustaining fiscal discipline over a long period of time and avoiding situations where every five years we destroy our economy and inflict severe hardship on our people and our businesses” is absolutely important.

Also critical to the country’s sustainable development, in his view, is “sustaining public sector reforms to build capacity to provide effective support to the private sector to drive Ghana's economic transformation.”

The Managing Director of Unilever Ghana, Mr Charles Cofie, was confident that measures being put in place by the company will impact positively on its earnings and strengthen its competitiveness.

He said last year “proved difficult and challenging for Unilever Ghana as the secondary effects of the global credit crisis and change of government locally were felt, especially following a very strong performance in 2008. Consumer demand was generally weak in the context of the difficult economic environment, and was exacerbated by heightened competitive activity in the market place, from established and artisanal products. We reduced prices temporarily across our brands at a point during the year, to offer more value to consumers. In spite of these challenges, we are encouraged by the high level of consumer confidence in our brands.”

The MD said in his overview of the year said “we maintained market leadership in 5 out of 8 product categories in which we compete. We also delivered strong cash inflow during the year, mainly from improvements in working capital, ending the year with a strong cash position.

“Growth was strong across our Home Care and Personal Care portfolios, with particularly strong growth in our key brands of Omo, Sunlight, Pepsodent, Lux, and Geisha. Intense competition from cheaper artisanal bar soaps impacted on the volumes of Key Bar soap. In response, we relaunched Key Mini, to offer competitive value to our loyal consumers, and this product is performing well in the market place.”

Mr Cofie expressed optimism that something will be done about the recent debilitating increases in utility tariffs, because if that happens, the company will be put in a better stead to deliver on its promise in the 2010 fiscal year.




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