PRESCO PLC. Annual Report & Accounts 2010 RC

Transcription

1 PRESCO PLC Annual Report & Accounts 2010 RC

2 PRESCO Plc RC PRESCO PLC Producer of Specialty Fats and Oils Presco is a fully integrated agro-industrial establishment with oil palm plantations, palm oil mill, palm kernel crushing plant and vegetable oil refining plant. It is at present the only one of such in Nigeria. Presco specialises in the cultivation of oil palm and in the extraction, refining and fractionation of crude palm oil into finished products. Presco supplies speciality fats and oils of outstanding quality to customer s specification and assures a reliability of supply of its products all year round. This is made possible by the integrated nature of the company s production process. Contact information: Presco Plc Obaretin Estate Km 22 Benin / Sapele Road PO Box 7061 Benin City, Edo State, Nigeria Tel: ; Tel: +32 (0) Fax: +32 (0) info@presco-plc.com 2 PRESCO PLC Annual Report

3 Contents Notice of Annual General Meeting... 4 Financial Highlights... 5 Directors and Professional Advisers... 7 Chairman s Statement... 8 Directors of Presco Plc Report of the Directors Corporate Governance Report Audit Committee s Report Report of the Auditors Statement of Accounting Policies Profit and Loss Account Balance Sheet Statement of Cash Flows Notes to the Accounts Statement of Value Added Five Year Financial Summary Share Capital History Proxy Form Company Secretary s Address PRESCO PLC Annual Report

4 Notice of Annual General Meeting NOTICE IS HEREBY GIVEN that the 18 th Annual General Meeting of Presco Plc will be held at The Dura Club, Obaretin Estate, Km. 22, Benin/Sapele Road, Ikpoba-Okha LGA, Benin City, Edo State on Wednesday 27 July 2011 at am to transact the following business: Ordinary Business 1. To lay before the meeting the audited accounts of the Company for the year ended 31 December 2010 together with the reports of the Directors, Auditors and the Audit Committee thereon. 2. To declare a dividend. 3. To elect and re-elect Directors. 4. To authorise the Directors to fix the remuneration of the Auditors. 5. To elect members of the Audit Committee. Notes 1. Proxy A Member of the Company entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy to attend and vote instead of him. A proxy need not be a Member of the Company. A proxy form is enclosed. Executed proxy forms should be deposited at the office of the Company s Registrars, First Registrars Nigeria Limited, Plot 2, Abebe Village Road, Iganmu, Lagos not less than 48 hours before the time of the meeting. 2. Closure of Register and Transfer Books The Register of Members and Transfer Books will be closed from Monday 18 July to Friday 22 July 2011 both days inclusive to enhance preparation for the payment of dividend. 3. Dividend If the dividend recommended by the Directors is approved, dividend warrants will be posted on Monday 8 August 2011 to the shareholders whose names are on the register of members at the close of business on Friday 15 July Audit Committee In accordance with Section 359(5) of the Companies and Allied Matters Act [cap C20, Laws of the Federation of Nigeria, 2004] any member may nominate a shareholder as a member of the Audit Committee by giving notice in writing of such nomination to the Company Secretary at least 21 days before the Meeting. BY ORDER OF THE BOARD Registered Office Isaac O. Ona Esq. Company Secretary Obaretin Estate, Km 22, Benin/Sapele Road Ikpoba-Okha Local Government Area, Benin City, Edo State. Dated this 25 th day of March

5 Financial Highlights % increase/ N 000 N 000 (decrease) Major balance sheet items Total assets 7,381,066 7,589,291 (2.74) Shareholders fund 3,518,197 2,623, Share capital 500, , Share premium 1,173,529 1,173, Revenue reserve 1,843, , Major profit and loss account items Turnover 5,386,056 4,004, Profit before taxation 1,333, , Profit after taxation 1,095, , Profit transferred to rev. reserves 1,095, , Information per 50 Kobo ordinary share Earnings (Kobo) Declared dividend (Kobo) Net assets (Kobo) Stock exchange quotation at 31 Dec. (Naira)

6 Company Profile HISTORY AND BUSINESS Presco Plc was incorporated in Nigeria on 24 September 1991 as Presco Industries Limited, a private limited liability company, and became a public limited liability company in February The Company owns oil palm plantations, a palm oil mill and palm kernel crushing plant, vegetable oil refining and fractionation plants and is at present the only fully integrated company of its kind in Nigeria. Presco Plc specializes in the cultivation of oil palms and in the extraction, refining and fractioning of crude palm oil into vegetable oil and palm stearin. The company supplies these specialty fats and oils to the high quality specifications of its customers and assures a reliability of supply of its products all year round, due to the integration of the entire cycle. The company operates from two States, Obaretin Estate and Ologbo Estate in Edo state and Cowan Estate in Delta Estate. The Obaretin Estate was initiated by the then Bendel State Government in the second half of the seventies with financial support from the Word Bank as part of the State government oil palm development programme. The implementing agency was the Oil Palm Company Limited (OPCL), a state government concern. In 1985, the Bendel State Government relinquished control of the Obaretin Estate to President Industries Nigeria Limited, a textile manufacturing group. Planting activities resumed in 1986 and the construction of an integrated processing facility began in The President group operated the project, and then known as Presco Oil Mills and Plantations, as a division until 1991, when Presco was established as an incorporated company and all the assets and liabilities of the project were transferred to the new company. Societe d investment pour I Agriculture Tropicale anonyme ( Siat ), a Belgian company involved in plantation investment and management in West Africa was invited to participate in the company as shareholders and Technical Partners in order to effect an intended broadening of the company s capital base by bringing in professional managers as shareholders. President Industries then held 67% of Presco s paid-up share capital of N50,000,000 comprising 50 million ordinary shares of N1 each. Siat sa of Belgium held the balance of 33%. Following a capitalization exercise in 1995, the Siat group increased its shareholding in Presco to 50%. The Siat Group subsequently became the only shareholders in December 1997 when the President Group divested its interest in the company. In 2002 the company became a public limited company and with a successful Initial Public Offer (IPO) completed in October the same year, Presco shares were admitted to quotation at The Nigerian Stock Exchange. Presco Plc Shares are now actively traded on The Nigerian Stock Exchange, With the Siat Group holding 60% while the Nigerian Public holds 40%. On re- registration as Public Company in 2002, the authorized share capital of the company was raised to N250,000,000 divided into 500,000,000 ordinary shares of 50 kobo each. The company gave a bonus shares of one for one in 2007 and this further raised the authorized and paid-up share capital of the company to N500,0000,000 divided into 1,000,000,000 shares of 50 kobo each. There are currently shareholders on the company s register of shareholders. 6

7 Directors and Professional Advisers BOARD OF DIRECTORS: HE. Pierre Vandebeeck (Belgian) Chairman Mr. U. Pilani (Indian) Acting Managing Director (Appointed 19 Nov. 2010) Mr. C. Minguy (French) Managing Director (Resigned October, 2010) H.R.H. (Dr.) O. Akenzua, JP Engr. J.B. Erhuero, JP, mni Mr. Osa Osunde Chief O.F.J. Oyaide Mr. Atedo N.A Peterside, OON Miss Marie Vandebeeck (Belgian) (Resigned wef 1 January 2011) Mr. D. Randall (South African) Dr. Shettima Mustafa, CON COMPANY SECRETARY: Isaac O. Ona Esq. REGISTERED OFFICE: Obaretin Estate, Km. 22, Benin/Sapele Road, Ikpoba-Okha Local Government Area, Benin City, Edo State. REGISTRARS & TRANSFER OFFICE: First Registrars Nigeria Ltd, Plot 2, Abebe Village Road, P.M.B Marina, Lagos. TECHNICAL PARTNER/ MANAGING AGENT: sa Siat nv Brussels, Belgium. SOLICITORS: Abdulai, Taiwo & Co., Goodwill House, 278, Ikorodu Road, Lagos. AUDITORS: Spiropoulos, Adiele, Okpara & Co. 59B Urubi Street, P.O.Box 8411, Benin City, Edo State, Nigeria. 7

8 Chairman s Statement Distinguished Shareholders, Fellow Directors, Ladies and Gentlemen, I am happy to welcome you all to the 18th Annual General Meeting of our Company, Presco Plc. As usual we are here today to consider our performance in the past year as presented in the Annual Report and Accounts of the Company for the year ended 31 December 2010, and therefore, I consider it necessary to first review some of the relevant environmental factors under which we operated in The Business Environment Judging from the IMF Report which commended some of the efforts of the Nigerian authorities in the year, the economic outlook for Nigeria is positive. According to official statistics, inflation stood at 11.8% in 2010 while growth rate was 6.8%. The business environment in 2010 was far better than the previous year in that Nigeria had been successful in weathering the global economic recession, had managed the domestic banking crisis well, and achieved improvement in economic growth even though inflation rate remained high. A positive effect of the fiscal stimuli packages that were put in place during the year 2010 combined with the stimulus packages of 2009 resulted in the improved economic growth measured by the real GDP rate. The social environment remained also peaceful during the year. The Vegetable Oil Industry Crude Palm Oil (CPO) prices in the global market rose steadily throughout the year. As major economies try to reestablish their demand, their currencies have been witnessing instability which has led to hardening of commodity prices. Nigerian palm oil industry has been stable though it has witnessed imports seeping through the unauthorised routes. In an attempt to close the gap between aggregate national production and consumption of all oils and fats, government has put farmers in a weak position by giving licence to some traders to import oil. If it is true that there is a shortfall in domestic production of all fats and oils in Nigeria, importation is required to make up the deficit. Import licenses should however be granted to those companies that are actively investing in the industry and not to traders as is done in certain other industries, as those with vested interest in the industry will ensure that only the correct amount will be imported so as not to jeopardise the long term development of the domestic production. Nigeria has to move from being a trading economy to a production economy. Presco, as the market leader in the vegetable oil industry, continues to take an active role in the Plantation Owners Forum of Nigeria to influence Government policy in the best interests of the industry. Expansion and Facility Improvements The Company accessed a facility of about N2 billion from the Commercial Agriculture Credit Scheme (CACS) in 2009 which was used to finance the expansion of our processing capacity; we have upgraded our mill by doubling its capacity and we have also doubled the capacity of the refinery. In addition, we have successfully installed the 1.2 MW turbine which will result in important savings of diesel consumption. Towards increasing the planted area, we are making good progress at developing Ologbo where we planted 750ha in 2010 and are planning to add another 1000ha in Our long term objective is to achieve 20,000ha of palm plantation supported by correspondent facilities to process 250,000mt of fruit per annum. We have also commenced investments in rubber for which we are in the process of acquiring a vast track of land of 15000ha.We hope to achieve this ambitious programme over the next 10 years. Operating Results The year 2010 was remarkably good as the condition was very favourable; as a result, FFB production for the period was up, to 87,856 tons from 65,295 tons the previous year; CPO production was 17,420 tons. Refined product sales were at 17,623 tons. Our turnover for the year was N5,386,056,000 compared with 2009 which was N4,004,524,000, resulting in a profit after tax of N1,095,029,000 as against a profit after tax of N239,427,000 in

9 Chairman s Statement This is by all means a very good result. Dividend In fulfilment of our pledge to our shareholders and in view of the good result of the year 2010, the Board of Directors has proposed a dividend of 50 kobo per share, amounting to N500,000,000 for shareholders approval, subject to withholding tax at the appropriate rate. Community Relations Presco Plc formalised its Policy on Corporate Social Responsibility in 2010 by reducing it to a document (Policy Document on Corporate Social Responsibility). Uday Pilani who was the then Company s Chief Financial Officer was appointed to the Board and appointed acting Managing Director with effect from 19 November Let us wish him a fruitful tenure. Corporate Governance In line with national and international requirements for greater disclosure and transparency of corporate governance, this year s Annual Report contains an additional section, the Corporate Governance Report. It is expected that this will bring greater transparency to our management style and greater confidence to our shareholders. Other Matters During the year, the Company in keeping with this policy devoted 1% of its turnover to the provision of social infrastructure for our host communities. During the year, provision of portable water and electricity to our host communities received a boost. In total, the sum of over N41.5 million was expended on various community development projects. Our People I have always said that our plantations are worth nothing without our people; therefore all those who work for the Company, in whatever capacity are important, and have all contributed to the progress that the Company has been making. On behalf of the Board and Shareholders, I thank all employees, including those who have retired for their loyalty and commitment to the Company. I cannot end this statement without acknowledging the support and technical expertise of our core shareholder, nv Siat sa; the overwhelming contribution of Siat to Presco Plc over the past 20 years has been wonderful as it has been the foundation of the Company s success. I also thank my colleagues on the Board for the wisdom, the harmony and experience they continue to bring to the Company. As always, His Royal Majesty the Oba of Benin, has been very supportive to us. And to the Governments of Edo and Delta States may I express our deep gratitude for providing us a peaceful and conducive atmosphere to operate. Lastly, I thank all shareholders for their loyalty and commitment. May I wish all of you good health, happiness and success in all your endeavours. God bless Nigeria! God bless Presco! Board Changes Since the last annual general meeting, Mr Christophe Minguy and Miss Marie Vandebeeck resigned from the Board. Please join me in thanking them for their invaluable services to the Company. In place of the former Managing Director Mr. Minguy, Mr. P. Vandebeeck Chairman 9

10 Directors of Presco Plc Mr. Pierre Vandebeeck Chairman Chief O.F.J. Oyaide Mr. Christophe Minguy Managing Director (Resigned 30 th October 2010) Mr. Atedo N.A Peterside, OON Mr. Uday Pilani Managing Director (Wef November 2010) Dr. D. Randall HRH (Dr) O. Akenzua, JP Dr. Shettima Mustafa Engr. J.B. Erhuero, JP, mni Miss Marie Vandebeeck (Resigned 1 st January, 2011) Mr. Osa Osunde 10

11 Report of the Directors The Directors have the pleasure in submitting their report and the financial statements for the year ended December 31, Principal Activities The principal activities of the Company are the development of oil palm plantations, palm oil milling, palm kernel processing and vegetable oil refining. The products of the Company are: refined bleached and deodorised palm oil, palm olein, palm stearin, palm fatty acid distillate, palm kernel oil (crude and refined) and palm kernel cake. 2. Result The Company s performance during the year under review is summarised below. Turnover was 34.41% higher than the previous year. A net operating profit after taxation of N1, 095,030 million was achieved compared to a profit of N239, 427 million for the year ended December 31, N 000 N 000 Turnover 5,386,056 4,004,524 Profit after taxation 1,095, , Dividend In respect of the current year, the Directors recommend for approval a dividend of 50 kobo on each 50 kobo ordinary share amounting to N500 million, subject to the deduction of withholding tax at the appropriate rate. At the last AGM shareholders approved the Directors recommendation of a dividend of twenty kobo on each 50 kobo ordinary Share amounting to N200 million, subject to the deduction of withholding tax at the appropriate rate. 4. Directors The Directors who held office during the year and at the date of this report are: HE. Pierre Vandebeeck (Belgian) Chairman Mr. U. Pilani (Indian) Acting Managing Director (Appointed 19 Nov. 2010) Mr. C. Minguy (French) Managing Director (Resigned October, 2010) H.R.H. (Dr.) O. Akenzua, JP Engr. J.B. Erhuero, JP, mni Mr. Osa Osunde Chief O.F.J. Oyaide Mr. Atedo N.A Peterside, OON Miss Marie Vandebeeck (Belgian) (Resigned wef 1 January 2011) Mr. D. Randall (South African) Dr. Shettima Mustafa, CON In accordance with the Company s Articles of Association, Mr. P. Vandebeeck and Mr. Osa Osunde retire at this Annual General Meeting and being eligible offer themselves for re-election. Mr. U. Pilani was appointed a Director of the Company after the previous Annual General Meeting. He will retire at this Annual General Meeting and being eligible offers himself for re-election. 5. Directors Interest in Shares The interest of Directors in the issued share capital of the Company as recorded in the Register of Members and/or notified by the Directors for the purpose of Section 275 of the Companies and Allied Matters Act, CAP C20 LFN 2004, and disclosed in accordance with the Listing Rules of the Nigerian Exchange is as follows: 11

12 Report of the Directors Names of Directors As at 31 December 2010 (No. of shares) H.R.H. (Dr) O. Akenzua, JP 562,000 Engr. J.B. Erhuero, JP, mni 624,000 Chief O.F.J. Oyaide 252,500 Mr. Atedo Peterside, OON 18,010,780 Dr. Shettima Mustafa, CON 167,500 There is no notification of any change in the above shareholdings as at March 16, Substantial Shareholding The following shareholders held 5% and above of the issued share capital of the Company as at December 31, Shareholding Number % sa Siat nv 600,000, First Inland Bank /Fidelity Fin. Co. (TRDG) 81,073, Share Range Analysis The range of the distribution of the shares of the company as at December 31, 2010 is as follows: Share Range Shareholders Shareholdings Number % Number % , ,569, , ,898, , ,326, , ,078, ,357, ,868, ,077, ,652, ,440, ,658, ,073, ,000, TOTAL 9, ,000,000, Fixed Assets Significant fixed assets expenditure during the year was as follows: N 000 Work in progress 1,519,992 Building 57,919 Heavy duty equipment 136,882 Utilities 12,713 Furniture and fittings 9,720 Motor vehicles & wheel tractors 72,249 12

13 Report of the Directors 9. Major Customers The Company s products are sold directly on a selective credit and cash basis to customers comprising wholesalers, consumers and industrial users who are located within the country. Some of these are: Nestle Nigeria Plc, Lagos; Chikki Foods Industries Ltd, Lagos; Friesland Foods WAMCO Nigeria Plc, Lagos; OK Foods Company Ltd, Lagos. 10. Community Development Projects/Community Relations The Company s host communities development programme continued during the year ended December 31, The focus is on education, roads, water, electricity, and support to outgrowers. Total expenditure was =N=41,482, Donations N Federal Road Safety Corps 20,000 Manufacturers Association of Nigeria 25,000 TOTAL 45,000 No donation of any sort was made to political parties. 12. Research and Development There was no research and development expenses during the year ended December 31, Employment of Disabled Persons The Company maintains a policy of giving fair consideration to applications for employment of disabled persons having regard to their particular aptitudes and abilities. At present there is one disabled person employed by the Company. 14. Health, Safety and Welfare Medical services are provided free of charge for Company employees at the estate clinics. Appropriate personal protective equipment is provided for employees at work. There is a fire-fighting programme, which involves all employees and the use of sophisticated equipment. Welfare facilities provided include housing for employees (or payment of an allowance in lieu) and transport to and from the work place. 15. Employee Involvement and Training The Company maintains communication and consultation on a regular basis with employee representatives to brief employees on matters affecting them. On-the-job training facilities are provided for all categories of employees with a view to improving their performance, job satisfaction and prospects. External training programmes are also undertaken. 16. Auditors In accordance with Section 357 (2) of the Companies and Allied Matters Act, CAP C20, LFN 2004, Messrs Spiropoulos, Adiele, Okpara & Co (Chartered Accountants) will continue as Auditors of the Company having indicated their willingness to do so. A resolution will be proposed at the Annual General Meeting to authorise the Directors to fix their remuneration. BY ORDER OF THE BOARD Isaac O. Ona Esq. Company Secretary - March 25,

14 Corporate Governance Report Presco Plc follows the Corporate Governance Guidelines which is in compliance with the code of Corporate Governance in Nigeria and supplemented by the Corporate Governance Guidelines for the Siat Group of which it is a member which is in line with International Best Practice. The Board The Board is constituted of ten (10) Directors including the Chairman who has no executive responsibilities. The primary responsibility of the Board is to ensure that the Company s business strategy is appropriate and implemented effectively. On appointment, Directors receive a comprehensive induction, including site visits and meetings with senior management to help them build up quickly a detailed understanding of the Company. Additional training is arranged as appropriate, by the Company and at the Company s expense. Independence & Executive Status of Directors Mr. Pierre Vandebeeck Non Executive Mr. C. Minguy Executive (Resigned in Oct 2010) Mr. U. Pilani Executive HRH (Dr.) O. Akenzua, JP Independent Engr. J.B. Erhuero, JP, mni Non Executive Dr. Shettima Mustafa, CON Non Executive Mr. Duncan Randall Non Executive Mr. Osa Osunde Independent Chief O.F.J. Oyaide Independent Mr. Atedo N.A. Peterside, OON Independent Miss Marie Vandebeeck Non Executive (Resigned wef ) Details of each Director s experience can be found on the Company s website. Information about Directors remuneration is covered in the Annual Report. Directors have no fixed term. However, one third of Directors retire annually by rotation and can present themselves for reelection. The average length of service of Directors is six years. Board Meetings The Board of Directors met four times during the year, as follows: Meeting date March 25, 2010 May 06, 2010 July 29, 2010 Nov. 19, 2010 Main items of business Review of 2009 draft accounts and operations report for the first two months of 2010 report. Review and approval of 2009 final accounts and annual report, review of first quarter results and the approval of the appointment of a new director. Review half year operation report and approval of order of proceedings for the 2009 Annual General Meeting holding 30 July Approval of 2011 budget and third quarter financial result 14

15 Corporate Governance Report Names of Directors Number of Attendance at Meetings Mr. P. Vandebeeck 4 Mr. C. Minguy 3 HRH (Dr.) O. Akenzua, JP. 1 Chief O. J. Oyaide 3 Mr. O. Osunde 3 Mr. A.N.A. Peterside, OON 3 Mr. D. Randall 2 Miss M. Vandebeeck 2 Engr. (Chief) J.B. Erhuero, JP, mni 3 Dr. S. Mustafa, CON 1 Mr. U. Pilani 1 Conflicts of Interest All Directors and employees are expected to avoid direct or indirect conflicts of interest. Where a conflict of interest may arise in a matter to be decided by the Board of Directors the Director concerned is expected to inform the Board and to abstain from voting. Transactions between the Company and Directors, where they arise, take place at arm s length. There have been no transactions and other contractual relationships between the Company and its Board members and executive managers, which are not covered by its legal provisions on conflicts of interest. The Company carries out transactions with its parent company, sa Siat nv on an arm s length basis. The terms and conditions of transactions are covered by an agreement between Siat and Presco Plc. These transactions are in the nature of secondment of personnel and the purchase and supply of equipment and materials. Transactions in Shares and Compliance with Directives on Market Abuse The use of inside or unpublished information about the Company in buying or selling of its shares is strictly forbidden. In order to comply with legislation on insider dealing and market manipulation (market abuse), Directors and executive management are expected to declare transactions on their own account in the shares or other financial instruments of the Company to Security and Exchange Commission. Committees - Audit Committee Mr. Famous Igbinevbo (Chairman) H.RH. (Dr.) O. Akenzua, JP Mr. Kingsley Iyekekpolor Engr. (Chief) J.B. Erhuero Engr. M.O. T. Tobun Miss Marie Vandebeeck Shareholder member. Director member Shareholder member Director member Shareholder member Director member The Audit Committee met three times during the year, as follows: Meeting date Main items of business March 24, 2010 Consideration of draft audited accounts and annual report for May 5, 2010 Review of Internal Audit report. Nov. 12, 2010 Review and approval of Audit Planning Memorandum. 15

16 Corporate Governance Report Names of Committee Members Number of Attendance at Meetings Mr. Famous Igbinevbo 3 H.R.H.(Dr.) O. Akenzua 2 Mr. Kingsley Iyekekpolor 3 Engr. (Chief) J.B. Erhuero 1 Engr. M.O.T. Tobun 3 Miss Marie Vandebeeck 3 Details of attendance at the meetings are available for inspection at the Annual General Meeting. There is currently no Board Remuneration Committee because the full Board reviews changes to the remuneration policy, including bonuses, for all employees as part of the annual budget review exercise. Company Secretary All Directors have access to, and the services of, the Company Secretary and may take independent professional advice at the Company s expense. The Company Secretary is also responsible for facilitating the induction and professional development of Board members as well as ensuring information flow within the Board, its Committees and between the Non-Executive Directors and senior management. The Company Secretary is Mr. Isaac Ona. He has held the position since July Executive Management Under the leadership of the Managing Director, Executive Management is responsible to the Board for the implementation of the strategy and policies approved by the Board, making and implementing operational decisions and running the Company. Non-executive Directors, using their knowledge and experience, challenge, monitor and approve the strategy and policies recommended by Executive Management. Internal Audit The Company s internal audit function reports to the Managing Director. For its day-to-day and project work the department is guided by the instructions of the Audit Committee and the Company s Internal Audit Procedures Manual. The Internal Auditor is Mr. Iyekeoretin Obayuwana. He has held the position since March Environment, Health and Safety The Company conducts its affairs in a safe and environmentally sustainable manner. The Company promotes the health of its employees, contractors, customers and host communities. The Company aims to comply with all applicable environmental, health and safety laws and regulations and aims to improve its performance in these areas. Environmental, health and safety matters are integrated into business decision-making and training is provided to ensure that stakeholders are aware of the requirements of the Company s Corporate Governance Guidelines. In 2006 and 2007 Presco Plc received grant funds totalling 83,000 (of a total commitment of 107,300) from the DOEN Foundation of the Netherlands. The grant is being used, with significant financial input from Presco Plc, to help in various aspects of the Green Ologbo project, in which the company aims to conserve a large portion of the land concession acquired for the Ologbo Estate development of oil palm. In addition to conservation efforts, the Green Ologbo project covers awareness and education, ecological surveys and monitoring, socio-economic surveys and monitoring, and community development. 16

17 Corporate Governance Report Major Contracts between the Company and Third Parties There was no major contract with any third party. Shareholder Relations The Company is committed to maintaining good relations with all Shareholders through the annual report, general meetings, website and Presco News. Shareholders are able to put questions to the Board at the Company s Annual General Meeting. Directors are available to talk on an informal basis to Shareholders at the Annual General Meeting. At least 21 days notice of the Annual General Meeting is given to Shareholders. Isaac O. Ona Esq. Company Secretary March 25,

18 Audit Committee s Report to the Members of Presco Plc In accordance with the provision of Section 359(6) of the Companies and Allied Matters Act, CAP, C20, LFN 2004, members of the Corporate Audit Committee of Presco Plc hereby report as follows: We have exercised our functions under Section 359(6) of the Companies and Allied Matters Act, CAP C20, LFN 2004 and we acknowledge the co-operation of Management and Staff in the conduct of these responsibilities. We confirm that: (a) The accounting and reporting policies of the Company are consistent with legal requirements and agreed ethical practice. (b) The scope and planning of the external audit are in our opinion adequate. (c) The internal control system was in order. (d) The External Auditors Management Control Report was satisfactorily dealt with by Management. We deliberated with the External Auditors who confirmed that all necessary co-operation was received from Management and that they had issued a clean report. Mr. Famous Igbinevbo Chairman Audit Committee Dated this 24 th day of March Members of the Committee Mr Famous Igbinevbo (Chairman) H.R.H. (Dr.) O. Akenzua, JP Mr. Kingsley Iyekekpolor Engr. (Chief) J.B. Erhuero, JP, mni Engr. M.O.T. Tobun Miss Marie Vandebeeck The Company Secretary, Mr. Isaac O. Ona, acted as secretary to the Committee. 18

19 Report of the Independant Auditors to the Members of Presco Plc 19

20 Statement of Accounting Policies For the year ended 31 December 2010 The following are the significant accounting policies, which have been adopted in the preparation of its financial statements: 1. Basis of Accounting The financial statements are prepared under the historical cost convention. 2. Turnover Turnover represents the net value of goods and services sold to third parties during the year. 3. Fixed Assets Fixed assets are stated at cost less accumulated depreciation. 4. Depreciation Depreciation of fixed assets is on a straight-line basis at the following rates calculated to write off the cost of the assets concerned over their estimated useful lives: % % Leasehold Land 4 4 Plantation 4 4 Processing equipment 6 2/3 6 2/3 Buildings 5 5 Vehicles and wheel tractors Heavy duty equipment Utilities Furniture and fittings Computer equipment Tankers and tractors Finance lease The capital element of assets under finance lease is capitalised along with the Company s fixed assets. The obligation to the lessor is shown as part of borrowings, appropriately classified as to maturity. 6. Stocks Stocks are valued at the lower of cost and net realisable value and are stated net of allowances for obsolete, slow moving or defective items, where appropriate. Cost incurred in bringing each stock item to its present location and condition is derived as follows: a. Raw materials and engineering spares - Purchase Costs on an average basis, including transportation and applicable handling charges. b. Palm oil products and products in process - Average cost of direct materials and labour plus the appropriate amount attributable to production overheads based on normal production capacity. Packaging materials of products are non returnable and are valued at cost 20

21 Statement of Accounting Policies 7. Apportionment of estate overheads to development Estate overheads are apportioned between agricultural investments and agricultural operating costs on the basis of the ratio of immature plantings to expenditure on mature plantings. 8. Deferred taxation Deferred taxation, which arises principally from timing differences in the recognition of items for accounting and tax purposes, is calculated using the liability method. This represents taxation at the current rate of corporate income tax on the difference between the depreciation charged in the financial statements and the capital allowances claimable for tax. This is in accordance with SAS 19 on Accounting for Taxes. 9. Foreign currencies Transactions in foreign currencies are recorded in Naira at the rates of exchange ruling at the date of the transactions. Assets and liabilities denominated in foreign currencies are converted to Naira at the rates of exchange ruling at the balance sheet date. Gains or losses arising there from are recognized in the profit and loss account. Where such gains or losses relate to long term foreign currencies denominated loans they are taken to foreign currency revaluation reserve and released at the expiration of the loan repayment. 10. Employees pension and gratuity The Company operates a contributory pension scheme covering all eligible employees in accordance with the Pension Reform Act Deductions of 7.5% are made from employees emoluments and in addition, the Company makes a contribution of 7.5% of the employees emoluments. The Company s contribution is charged to the profit and loss account. Liabilities for gratuity are provided for junior, senior and management staff by setting up a provision within the Company. The provision represents the estimated value of the liability for the gratuity which is calculated annually by the Company as a percentage of the current pensionable payroll and is charged to the profit and loss account so as to spread the cost over the estimated service lives of the employees. 11. Taxation Income tax and education tax payable are provided on taxable profit and adjusted profit respectively at the current tax rates. 12. Borrowing costs Borrowing costs relating to qualifying capital expenditure are capitalised in the period in which they are incurred in accordance with the provision of International Accounting Standard (IAS) Provisions Provision is recognised when the Company has a present obligation whether legal or Constructive, as a result of a past event for which it is probable that an outflow of resources Embodying economic benefits will be required to settle the obligations and a reliable Estimate can be made of the amount of the obligation in accordance with the Statement of Accounting Standard (SAS)

22 Profit and Loss Account For the year ended December 31, Note N 000 N 000 Turnover 2 5,386,056 4,004,524 Cost of sales 3 3,089,276 2,251,895 Gross Profit 2,296,780 1,752,629 Other Income 4 109,212 50,817 2,405,992 1,803,446 Administration expenses 907,576 1,358,567 Operating profit 1,498, ,879 Interest and similar charges 5 164, ,731 Profit before taxation 6 1,333, ,148 Taxation 7 238,593 98,721 Profit after taxation transferred to rev. a/c 1,095, ,427 Earnings Per Share (EPS): Basic (Kobo) Earnings Per Share (EPS): Adjusted (Kobo) The annexed notes and the accounting policies on pages 16 to 38 form an integral part of these financial statements 22

23 Balance Sheet as at December 31, Note N 000 N 000 FIXED ASSETS 8 5,914,343 4,740,974 FINANCE LEASE ASSETS ,798 5,914,343 4,753,772 CURRENT ASSETS Stocks ,482 1,107,794 Trade Debtors , ,717 Other debtors and prepayments ,333 64,335 Bank balances and cash ,524 1,335,673 1,466,723 2,835,519 CREDITORS Amount falling due within one year Bank overdrafts and loans ,624 Trade creditors ,977 1,132,203 Taxation 7 26,719 8,726 Other creditors and accruals , ,674 Amount due to related companies 17 13, , ,135 1,980,025 NET CURRENT ASSETS/(LIABILITIES) 932, ,494 Total Assets Less Current liabilities 6,846,931 5,609,266 Deferred taxation , ,990 CREDITORS Amount falling due after more than one year Term loans 19-2,296,528-2,198,334 PROVISIONS FOR LIABILITIES: STAFF GRATUITIES , ,775 Net assets 3,518,197 2,623,167 CAPITAL AND RESERVES Share capital , ,000 Share premium 22 1,173,529 1,173,529 Foreign currency revaluation reserve 23 1,174 1,174 Revenue reserves 24 1,843, ,464 3,518,197 2,623,167 The annexed notes and the accounting policies on pages 16 to 38 form an integral part of these financial statements 23

24 Statement of Cash Flows For the year ended December 31, Note N 000 N 000 Cash flows from operating activities Cash receipts from customers 5,541,389 3,952,199 Cash paid to suppliers and employees -4,383,564-2,980,466 Tax paid , ,081 Net cash provided by operating activities 25 1,144, ,652 Cash flows from investing activities Purchase of fixed assets 8&9-1,660, ,588 Proceeds on sales of assets 0 13,748 Net cash provided by investing activities -1,660, ,840 Cash flows from financing activities Prior year dividend paid -198, ,887 Long term loan received ,222 1,672,227 Term loans repaid , ,061 Gratuity paid 20-13,874-18,370 Obligation under finance lease ,464 Interest paid 5-164, ,731 Net cash provided by financing activities -278, ,714 Decrease in cash and cash equivalents -795, ,526 Cash and cash equivalents at January 1 957, ,523 Cash and cash equivalents at Dec , ,049 24

25 Notes to the Financial Statements 1 The Company 1.1 Legal Form Presco Plc was incorporated as a private limited liability company on December 24, 1991 as Presco Industries Limited. Presco Plc became a public limited company in February 2002 with shares listed on the Nigeria Stock Exchange. sa SIAT nv of Belgium owns 60% of the Company s share capital while the balance of 40% is held by Nigerians. 1.2 Principal Activities The principal activities of the company are the development of oil palm plantations, palm oil milling, palm kernel processing and vegetable oil refining N 000 N Turnover Local sales Sales of main products 5,382,377 4,004,524 Mill by-products 3,255 0 Sales of palm seedlings & fertilizers Ash, PKC, Sales ,386,056 4,004,524 The Company currently sells all its products in Nigeria 3 Cost of sales Raw materials consumed 1,292, ,164 Upkeep of mature plantings, harvesting & lab. 156, ,062 Mill processing, refinery and packaging costs 1,430, ,110 Total Production cost 2,880,450 2,319,336 Selling and distribution costs(net of prov.) 208,826-67,441 Total cost of sales 3,089,276 2,251,895 4 Other Income Miscellaneous sales 56,747 47,576 Discount received 52,465 0 Fuel and lubricant sales (net) Live stock sales Agric material & equipment sales ,212 50,817 5 Interest and Similar Charges Interest on loans 151, ,334 Interest on Overdrafts, etc. 13,522 9,533 Total interest expenses 164, ,867 Amount included in cost of fixed assets 0-8, , ,731 25

26 Notes to the Financial Statements 5.1 The interest capitalisation rate on the loan was nil for the 12 months (2009 average for 12 months was 7.72%). 6 Profit before taxation Profit before taxation is stated after charging/(crediting) the following: Depreciation of fixed assets 449, ,502 Depreciation of finance leased assets 0 5,826 Directors remuneration 5,020 6,532 Auditors remuneration 8,000 8,000 Loss/(Profit) on disposal of fixed assets 0 0 Interest on loans, overdraft, etc 164, ,731 Management fee 111, ,172 Seconded staff cost 317, ,474 Exchange (gain)/loss -85, ,040 7 Taxation 7.1 Profit and loss account Income tax 0 30,000 Education tax 31,680 16,384 Provision on income tax no longer required 0-32,652 31,680 13,732 Deferred taxation (Note 18) 206,913 84, ,593 98, Balance sheet As at January 1 8, ,702 Provision for the year 31,680 13,732 40, ,434 Prov. On dividend no longer required 0-219,049 Provision on income tax no longer required 0-140,578 40, ,807 Payment during the year -13, ,081 26,719 8,726 The charge for taxation is based on the provisions of the Companies Income Tax Act, Cap C21, LFN 2004, as amended to date and the Education Tax Act, Cap E4, LFN N 000 N Finance lease assets Motor Vehicles As at January 1 33,645 33,645 Additions during the period 0 0 Disposal -33,645 0 As at December ,645 26

27 Notes to the Financial Statements Depreciation As at January 1 20,847 15,021 Charged for the period 0 5,826 Disposal -20,847 0 As at December ,847 Net book value As at December , Stocks Raw materials 9,000 9,000 Finished products 29, ,526 Cattle 14,031 13,356 Engineering spares 535, ,790 Fertiliser, chemicals, etc 33, ,354 Goods in transit 206, , ,482 1,107, Debtors Trade debtors 172, ,717 Provision for doubtful debts , , Other debtors and prepayments Advances to suppliers 201,163 0 Staff loans and advances 17,016 13,431 Deposit and prepayments (Note12.1) 34,352 31,209 Deposit for letters of credits 10,281 10,281 Sundry debtors 41,521 9, ,333 64, Deposit and prepayments Community development 0 0 Syndicated loan interest prepaid 0 0 Prepaid consultancy fees 0 0 Others 0 0 Insurance Prepaid Rent Prepaid 14,828 8,883 Miscellaneous Prepaid 18,791 22,228 34,352 31, Cash and Bank balances Cash at bank 158,542 1,331,856 Cash in hand 2,982 3, ,524 1,335, Bank overdrafts and loans Bank overdrafts 0 378,624 Term loans- Amt due within one yr (Note 21) 0 0 Letters of credit bridging facilities ,624 27

28 Notes to the Financial Statements 15 Trade Creditors Suppliers 136,977 1,132, Other creditors and accruals Advances from customers 1,068 1,183 Staff pension accruals (Note 16.1) 0 0 Accruals 309, ,484 Dividend unpaid (note 24.1) 12,460 10,769 Sundry creditors 34,022 6,238 Obligation under finance lease (16.2) , , Staff pension accruals As at January 1 0 5,129 Provision for the period ,129 Payment during the period 0-5,129 As at December Obligation under finance lease As at January ,464 Additions during the period ,464 Discharged during the year 0-10,464 As at December Amount due to related companies 13, , Deferred taxation As at January 1 673, ,001 Charged for the period 206,913 84,989 As at December , , Term loans As at January 1 2,198, ,445 Payment during the year -499, ,061 Reclassified loan 0 289,722 Addition during the year 597,222 1,600,000 Exchange (gain)/loss 0 72,227 As at December 31 2,296,528 2,198, Term of Loan To support its expansion programmes, in 2003 the Company entered into a loan agreement with a consortium of banks for a term loan of N1.3 billion at an interest rate of the higher of the maximum lending rate per annum or an average of the prime lending rates of all the lenders on the interest calculated to date subject to any maximum lending rate as specified by Central Bank of Nigeria. 28

29 Notes to the Financial Statements The loan initially had a six year term with a moratorium of eighteen months and repayment was to commence on June 30, However, the facility was rescheduled in 2005 accounting year and as a result, the loan and moratorium periods were extended by 18 months. The first quarterly capital repayment was to commence from December 31, 2006 while the final repayment of the loan was to be at June 30, However, with effect from January 1, 2007 Stanbic IBTC Bank Plc restructured the agricultural term loan facility up to the sum of USD5,000,000 (five million Dollars only) to replace the existing N650 million facility. The restructured facility would be for a period of 5 years. ( The tenor is inclusive of a 9 months moratorium apart from the 18 months moratorium earlier granted on the Naira facility.) Hence, the total tenor of the existing and restructured facility is 8 years. The interest rate is 5% above the 3-month US dollar London Interbank Offer Rate (LIBOR). The loan will be repaid in 18 quarterly instalments with effect from September 30, A CACS Loan of =N=197 million was obtained from Access Bank Plc during the year ended 31-Dec The syndicated loan has been fully paid off. The loan is secured on a negative pledge on the assets of the Company and a letter of comfort was issued by the holding company, sa SIAT nv, Belgium N 000 N Staff Gratuity As at January 1 113, ,363 Provision for the year 51,402 27, , ,145 Payments during the year -13,874-18,370 As at December , , Share Capital Authorised, issued and fully paid: 1,000,000,000 ordinary shares of 50 kobo each 500, , Share Premium As at December 31 1,173,529 1,173, Foreign Exchange Revaluation Reserve As at January 1 1,174 11,542 Net movement during the year 0-10,368 As at December 31 1,174 1, Revenue Reserve As at January 1 948, ,458 Profit and loss account 1,095, ,427 Declared dividend (24.1) -200, ,000 Prior year adjustment 0 140,579 As at December 31 1,843, ,464 29

30 Notes to the Financial Statements 24.1 Dividend (a) Declared dividend represents dividend proposed for the preceding year but declared during the current year. (b) The movement in the dividend payable account was as follows: N 000 N 000 As at January 1 10,769 5,656 Declared dividend (note b) 200, ,000 Payments during the year -198, ,887 12,460 10,769 (c ) Dividend payable of N12.46 million (2009: N10.77 million) as reported in the note 24.1 (b) above is included in cash and bank balances in note 13. On July 30, 2010, the shareholders declared at the Annual General Meeting a dividend per ordinary share of 20 Kobo amounting to N200 million and this was paid during the year less withholding Tax. In respect of the current year, the Directors propose that a dividend of 50 kobo per ordinary share will be paid to the shareholders. The total dividend payable of N500 million is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. Dividend to shareholders are now accounted for on the date of declaration as they do not meet the criteria of present obligation in Statement of Accounting Standard (SAS) 23. The proposed dividend of N500 million is subject to withholding tax at the appropriate tax rate. 25 Reconciliation of Profit before taxation to net cash provided by operating activities N 000 N 000 Profit after taxation 1,095, ,427 Adjustments to reconcile net income to net cash provided by operating activities Deferred taxation 206,913 84,989 Interest paid 164, ,731 Depreciation of fixed assets 449, ,502 Depreciation of finance lease fixed assets 0 5,826 Provision for gratuity 51,402 27,782 Loss on disposal of fixed assets 0 0 Loss on foreign exchange -85, ,040 Prior year adjustments 0-140,579 Changes in assets and Liabilities Decrease/(increase) in stock 279, ,970 Decrease/(increase) in trade debtors 155,333-52,324 (increase)/decrease in other debtors & prepayments -239,998 56,048 Decr/(Incr) in amount due from related companies -152,625 3,220 Increase /(decrease) in short term loans 0-289,722 Increase/(decrease) in trade creditors -995, ,940 30

31

32 Notes to the Financial Statements The table below shows the salary band and the number of the employees of the company, other than employees who discharged their duties wholly or mainly outside Nigeria during the year N N Number Number 70, , , , , , , , , , , , , , , , ,001 1,000, ,000,001 1,100, ,100,001 1,200, ,200,001 1,300, ,300,001 1,400, ,400,001 1,500, ,500,001 1,600, ,600,001 1,700, ,700,001 1,800, ,800,001 1,900, ,900,001 2,000, ,000,001 3,000, Contingent Liabilities There are no existing impending or threatened litigations of a material nature against or by the company during the year. 29 Capital Commitments Capital expenditure authorised by the directors, but not provided for in these financial statements was N1.172 billion (2009 N10.729m). 30 Related Party Transactions sa Siat nv, Belgium Presco Plc is a subsidiary of sa Siat nv, Belgium with 60% holding. During the year, the company had significant no transactions during the year. Ghana Oil Palm Development Company Limited Ghana Oil Palm Development Company Limited is a related company to Presco Plc. During the year, the company had significant transactions amounting to N926 Million which are in the nature of supply of oil products. 32

33 Notes to the Financial Statements Siat Gabon Siat Gabon is a related company to Presco Plc. There was no material transaction between the two companies during the period. Compagnie Heveicole de Cavally, Ivory Coast Compagnie Heveicole de Cavally is a related company to Presco Plc. There was no material transaction between the two companies during the year. 31 Comparative Figures Some comparative figures have been restated to reflect a more meaningful comparison. Due to changes in format to comply with statutory requirements some comparative figures are not available. 33

34 Value Added Statement For the period ended December 31, N 000 % N 000 % Turnover: Local 5,386,056 4,004,524 Export 0 0 Other income 109,212 50,817 5,495,268 4,055,341 Bought -in materials and services: Imported -834, ,030 Local -1,834,463-1,725,143 Value added 2,826, ,458, Applied as follows: To pay employees Salaries, wages and others benefits 678, , To pay providers of capital Interest on loans and overdrafts, etc 164, ,731 8 Dividend Declared 200, ,000 1 To pay government: Income tax Education tax 31, ,731 2 To provide for replacement of assets: Depreciation of fixed assets 449, , Depreciation of lease assets ,826 0 To provide for the future: Deferred taxation 206, ,989 1 Retained profit 1,095, , ,826, ,458, Value added represents the wealth created by the efforts of the company and its employees. This statement shows the distribution of that wealth among employees, government, providers of capital and that amount retained for future creation of wealth. 7 0% 8 0% 6 26% 5 1% 4 2% 9 20% 3 21% 1 23% 2 7% Distribution of Value Added 1. Sal. & Wages 678, Interest paid 164, Dividend 200, Income tax 0 5. Edu. Tax 31, Dep. Of Assets 449, Dep. Of lease Assets 0 8. Deferred tax 206, Retained profit 1,095,030 N 34

35 Five year financial summary N 000 N 000 N 000 N 000 N 000 BALANCE SHEET Fixed assets 5,914,343 4,753,772 4,223,150 3,904,957 3,345,252 Net current assets/(liabilities) 932, , , , ,988 Long term liabilities -3,328,734-2,986,099-1,247,809-1,435,537-1,402,658 Net tangible assets 3,518,197 2,623,167 2,694,107 1,956,962 2,315,582 FINANCED BY Share capital 500, , , , ,000 Share premium 1,173,529 1,173,529 1,173,529 1,173,529 1,173,529 Foreign currency rev tion reserve 1,174 1,174 11,542 64,030 0 Reserved for bonus issue ,000 0 Revenue reserve 1,843, ,464 1,009, , ,053 Shareholders funds 3,518,197 2,623,167 2,694,107 1,956,962 2,315,582 PROFIT AND LOSS ACCOUNT Turnover 5,386,056 4,004,524 3,964,454 2,266,945 2,347,611 Profit before taxation 1,333, , , , ,620 Taxation 238,593-98, , , ,938 Profit after taxation 1,095, , ,633 37, ,682 Dividend Proposed 200, ,000 25, , ,000 Per share data (Kobo) Earnings - (Basic) Dividend proposed Net assets Earnings per share, dividend per share and net assets per share are based on the number of 50 kobo share in issue at the relevant years. 35

36 Share Capital History AUTHORISED FULLY PAID Year Number of shares Value (Naira) Number of shares Value (Naira) Description Cash Cash conversion of debt to equity conversion of share of N1 to 50k conversion of debt to equity IPO Bonus of 1: BONUS HISTORY Date Number Amount (Naira) Bonus ratio issued issued

37 Proxy Form PROXY FORM 18 TH ANNUAL GENERAL MEETING I/We* the undersigned, being a member/members of Presco Plc, RC , hereby appoint ** or failing him / her. ** as my/our proxy to vote for me/us and on my/our behalf at the Annual General Meeting of the company to be held on Friday 27 July 2011 and at any adjournment thereof. Unless otherwise instructed, the proxy will vote or abstain from voting as he / she thinks fit. Dated this day of 2010 Signature NOTES 1. This form of proxy together with the power of attorney or other authority, if any, under which it is signed or a notarially certified copy thereof must reach the Company Secretary s office at Obaretin Estate, Km 22, Benin/Sapele Road, Ikpoba-Okha Local Government Area, PO Box 7061, Benin City, Edo State, not less than 48 hours before the time of the meeting. 2. Where the appointer is a corporation, this form may be under seal or under hand of an officer or attorney duly authorised. 3. This proxy will be used in the event of a poll being directed, or demanded. 4. In the case of joint holders the signature of any one of them will suffice, but the names of all joint holders must be shown. THE PROXY WILL VOTE (OR ABSTAIN FROM VOTING) AS HE / SHE THINKS FIT IN RESPECT OF ANY OTHER BUSINESS PROPOSED AT THE MEETING OF PRESCO PLC, RC , (17TH ANNUAL GENERAL MEETING), TO BE HELD AT THE DURA CLUB, OBARETIN ESTATE, KM 22, BENIN / SAPELE ROAD, IKPOBA / OKHA LGA, EDO STATE ON Friday 27 JULY 2011 AT A.M. I/We desire this proxy to be used in favour of or against the resolution as indicated alongside. Strike out whichever is not desired. ORDINARY RESOLUTION FOR AGAINST 1. To declare a dividend. 2. To elect and re-elect Directors. 3. To authorise Directors to fix the remuneration of the Auditors. 4. To elect members of the Audit Committee. Name of candidate Name of candidate Name of candidate Please indicate with X in the appropriate box how you wish your vote to be cast on the resolutions set out above. Unless otherwise instructed, the proxy will vote or abstain from voting at his/her discretion. Before posting the above form, please tear off this part and retain it for admission to the meeting ADMISSION CARD PRESCO PLC, RC Number of shares held Please admit the shareholder named on this form or his/her duly appointed proxy to the company s 17 th Annual General Meeting to be held at the Dura Club, Obaretin Estate, Km 22, Benin/Sapele Road, Ikpoba-Okha LGA, Edo State on Friday 27 July 2011 at a.m. Name of Shareholder:* Signature: Name of proxy:** Signature: A Member (Shareholder) entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of him/her. A proxy need not be a member. The proxy form has been prepared to enable you to exercise your right to vote. IMPORTANT Please insert your name in BLOCK CAPITALS on both the proxy form and admission card where marked *. If a proxy is attending on your behalf, please insert the name of the person, whether a member of the Company or not, who will attend the meeting and vote on your behalf where marked **. 37

38 The Company Secretary Presco Plc Obaretin Estate Km. 22, Benin/Sapele Road Ikpoba-Okha Local Government Area PO Box 7061 Benin City Edo State. Boiler in operation since nov Culvert - Ologbo North Alfa Laval Training 38

39 Notes 39

40