Wednesday, December 12, 2012

Unga AGM FY 2011-12

Location: KICC Amphitheatre
Date: 5 Dec 2012
Time: 10.30 am
My opinions in italics 

The matatu strike had delayed a lot of folks but the check-in handled by CRS was relatively slow. It took almost 30 mins to check in but it was organized since the security was good. There was a lunch voucher given at registration - more on this later.

It seemed the majority of the initial questions were not related to the Financial Statements or Annual Report. There was a sense of frustration among the directors since the questions were about SWAG (aka freebies like T-Shirts, flour, etc).

The relevant questions came at towards the end of the Q&A on the Financial Statements.
Q: What property is Unga planning to sell?
A: 4 acres on Ngong Rd but it is earmarked for "Recreational Use" only thus the sale is probably limited to Sports Clubs or such users. It is unlikely, like in the old days, that a buyer can change the use. The MD even thought that Nairobi needs the green space.

Q: What is the valuation of the properties?
A: Unga revalues the properties every 5 years & the next revaluation is coming up in 2013. The ROA is quite low.

Q: Does Unga use GMO grains/products?
A: No, since the law does not allow GMO but the MD was emphatic that when the next drought hits Kenya, which has been the case every 3-4 years, GMO grains will be imported.

Q: Why not buy local grain?
A: The local grain is very expensive especially maize since NCPB pays KES 3,000 per 90kg bag. This means the farmers expect a higher price. Unga pays sooner than NCPB and will not buy low-quality maize. The biggest competition are regional, not national, millers who don't care about quality.

Q: Why are the related party transactions/purchases with Seaboard Corporation (which owns 35% of Unga Holdings Ltd) amounting to KES 4.16bn (2011: 2.9bn) so high?
A: Seaboard is a large soft commodities trader & provides financing when banks may be more expensive or unwilling to do so. The purchases from Tanzania could drop if there is a ban on exports.

It was mentioned that the next 2-3 years will be tough with high interest rates, volatile exchange rates, high/volatile commodity prices, increasing costs and inflation. Competition has grown substantially from the regional (mid-sized) millers. Are they evading taxes?

The firm (& its subsidiaries) are planning to spend lots of capex to increase/improve capacity. I am not sure how these will be funded with the low ROA.

What was left unsaid but one could 'feel' was the question/risk of the election. Unga's buying centres are in areas (Nakuru, Eldoret) that were severely affected by PEV 2008. Imports have to come by road or rail from Mombasa which were disrupted.

The Board declared a KES 0.75 dividend & this was passed with nary a whisper. It was mentioned that dividends not swag is what shareholders should want.

Alan McKittrick & Andrew Stewart Ndegwa were re-elected as directors. There were 2 vacancies created by the resignation, of the erstwhile Chairman, Richard Kemoli & Jeremiah Kiereini. The new Chairperson is Isabella Ochola-Wilson who handled the meeting well despite the "swag" complaints & questions.

Some shareholders had complaints/questions unrelated to the Financial Statements but were gently chided by the Chairperson for not sticking to matters on the agenda. The matter came to a head when the agenda item regarding 'electronic dissemination' of information & dividends was being discussed. The Company Secretary explained why it was necessary to update the Articles & Memorandum of Association to 'match' the new laws.  of  A major gripe was that he (among other shareholders) did not have e-mail. The counter was that the abridged information would be published in the newspapers but some shareholders claimed they did not buy newspapers. 

A section of shareholders were fed up of the proceedings & visibly agitated at the back & forth about the 'electronic dissemination'. Others started walking out since lunch was 'pending'. I think if they had offered the lunch packs earlier, the hall would have emptied out sooner. An appeal to wait till the AGM was over was ignored. No idea what was in the lunch pack but these must be the largest cost of holding the AGM.

An uneventful AGM with no surprises but the outlook seems bleak over the next 2-3 years unless there is a paradigm shift in the taxation regime, interest rates and business environment.

25 comments:

Anonymous said...

I could not resist commenting. Well written!


my website - Go Here
My site - Read �

Anonymous said...

After I originally left a comment I appear to have clicked on the -Notify me when
new comments are added- checkbox and now whenever a comment
is added I receive 4 emails with the same comment.
Perhaps there is a way you are able to remove me from that service?
Thank you!

Look into my web page - Beitragsrechner private krankenversicherung

Anonymous said...

Great blog here! Also your website loads up
fast! What web host are you using? Can I get your affiliate link
to your host? I wish my site loaded up as fast as yours lol

Also visit my web page ... schuh online outlet

Anonymous said...

I'm truly enjoying the design and layout of your blog. It's a very easy on the eyes which
makes it much more pleasant for me to come here and visit more often.
Did you hire out a designer to create your theme?

Great work!

Also visit my website private krankenversicherung Beitrag

Anonymous said...

Have you ever thought about creating an e-book
or guest authoring on other websites? I have a blog based upon on the same topics you discuss and
would really like to have you share some stories/information.
I know my viewers would appreciate your work. If you're even remotely interested, feel free to shoot me an email.

Review my website - caribbean travel deals
my website > kiawah island vacation home rentals

Anonymous said...

First off I want to say terrific blog! I had a quick question which I'd like to ask if you don't mind.
I was curious to find out how you center yourself and clear your mind prior to writing.
I have had difficulty clearing my thoughts in getting my ideas out there.
I do enjoy writing but it just seems like the first 10 to 15 minutes are generally
wasted just trying to figure out how to begin. Any suggestions or tips?
Cheers!

Have a look at my web page home equity or refinance

Anonymous said...

When someone writes an post he/she retains the thought of a user in his/her mind that
how a user can understand it. Thus that's why this post is amazing. Thanks!

Feel free to surf to my web site: website search engine optimisation

Anonymous said...

This text is invaluable. Where can I find out more?

Have a look at my site; tybee island vacation rentals by owner

Anonymous said...

It's actually a nice and useful piece of info. I am satisfied that you just shared this useful information with us. Please keep us informed like this. Thank you for sharing.

my web site ... gesetzliche krankenversicherung preisvergleich

Anonymous said...

Have you ever considered creating an ebook or guest authoring on other blogs?
I have a blog based on the same subjects you discuss and would love to have you share some stories/information.
I know my viewers would value your work. If you're even remotely interested, feel free to send me an e mail.

Look into my webpage ... Web Hosting in Uk

Anonymous said...

Fastidious answer back in return of this difficulty with
solid arguments and describing the whole thing regarding
that.

Also visit my website; wechsel private krankenversicherung gesetzliche

Anonymous said...

Helpful info. Lucky me I discovered your site unintentionally, and I am shocked why this coincidence did not took place in advance!

I bookmarked it.

My webpage; business oppurtunity

Anonymous said...

Your style is so unique compared to other folks I have read stuff from.
I appreciate you for posting when you've got the opportunity, Guess I will just bookmark this page.

Visit my blog post :: private krankenversicherung ausland

Anonymous said...

Way cool! Some very valid points! I appreciate you penning
this write-up plus the rest of the website is extremely good.


Feel free to surf to my page: seo Experts in pakistan

Anonymous said...

Hello there! This blog post couldn't be written any better! Looking at this post reminds me of my previous roommate! He continually kept talking about this. I'll send
this article to him. Pretty sure he will have a very good read.
I appreciate you for sharing!

Here is my web site :: baufinanzierung Ohne schufa

Anonymous said...

Great goods from you, man. I've understand your stuff previous to and you're just extremely great.

I actually like what you've acquired here, certainly like what you're saying and the way in which you say it.
You make it entertaining and you still care for to keep it sensible.
I can not wait to read far more from you. This
is actually a wonderful web site.

Visit my blog post :: krankenkasse ohne zusatzbeitrag

Anonymous said...

Generally I don't read article on blogs, however I wish to say that this write-up very compelled me to try and do so! Your writing taste has been amazed me. Thank you, very great post.

Stop by my site; Strategies To Assist You Show Off Your Flair For Style - BiOrgResources

Anonymous said...

Everyone loves it when folks come together and share opinions.
Great blog, continue the good work!

Also visit my weblog; best business Opportunities 2011

Anonymous said...

Undeniably consider that that you stated. Your favourite reason appeared to be on the net the simplest thing to bear in mind
of. I say to you, I definitely get annoyed at the same time as other people think about
concerns that they just do not understand about. You managed to
hit the nail upon the top and also defined out the
entire thing with no need side-effects , folks could take a signal.

Will probably be again to get more. Thanks

Take a look at my web site; graduate student loan rates

Anonymous said...

Greetings! Very helpful advice in this particular post!

It is the little changes that produce the most important changes.
Thanks for sharing!

Also visit my web blog ratenkauf trotz negativer schufa

Anonymous said...

Quality content is the secret to interest the viewers to pay a quick
visit the web page, that's what this web site is providing.

Check out my web site: how to be an seo expert

Anonymous said...

An great establish of shoes, maybe not peradventure the most gorgeous, not the highest value tagged, nor is the insigne reputation, come what may normally requires that you peregrination worldwide, Christian Louboutin Sale
clarify these questions . supervise the pleasure shoes not till hell freezes over change, peradventure covetable,but, the injured indeed.Asics Running Shoes
Such a lay of the land you will compel ought to encountered, walked vertical working on my show cabinets in countless kinds shoes you lay one's hands on dazzling, certainly not to clinch. The obtaining value is accurate intent not be alluring, like too outrageous, adequate obvious the fad, guess good-looking users who think old-fashioned ... so that you are completely light-hearted thither unaffectedly difficult. Pick to judge on, finally unequivocal on a twosome, wear matrix week realise foot show, or exactly to healthy their clothes,Christian Louboutin Outlet
the way to scrutinize this time? To donate up'd somewhat painful to enter on to wear?

Anonymous said...

Sometimes seasons reasons some shoes is often[url=http://niketrainersuksale.webeden.co.uk]Nike Trainers UK[/url]
temporarily do not need the chance to[url=http://tomscanadaoutlet.snappages.com]Toms Shoes Sale[/url]
wear such shoes we should[url=http://addnikecanadastore.snappages.com]Nike Shoes Canada[/url]
properly erect them while in the[url=http://niketrainersuksale.webeden.co.uk]Nike Blazers UK[/url]
right place into order to avoid unnecessary damage of shoes[url=http://salelouisvuittonuk.webeden.co.uk]Louis Vuitton Outlet[/url]

However, if the insole is absolutely bad, could possibly require to use a soft brush and water gently scrub. Really should be noted that, do not use chemical soaps cleaning, or people result in the insole surface of cloth off.[url=http://shoppradabagsuk.webeden.co.uk]Prada Sale[/url]

Anonymous said...

Every now seasons reasons some shoes may by any means be[url=http://niketrainersuksale.webeden.co.uk]Nike Air Max[/url]
in do not fundamental the chance[url=http://tomscanadaoutlet.snappages.com]http://tomscanadaoutlet.snappages.com[/url]
use such shoes we essential to[url=http://addnikecanadastore.snappages.com]Nike Shoes For Women[/url]
becomingly put both of them in a mere[url=http://niketrainersuksale.webeden.co.uk]Nike Blazers UK[/url]
set upright put in in to steer clear of unnecessary injure to shoes[url=http://salelouisvuittonuk.webeden.co.uk]Louis Vuitton UK[/url]

Although if the insole is really bad, that obligated to manipulate a docile bracken and salt water gently scrub. Is well-known that, dodge the use of chemical soaps cleaning, or they intent right increasing the peril pro insole the cap of cloth off.[url=http://shoppradabagsuk.webeden.co.uk]Prada Sale[/url]

Anonymous said...

[url=http://www.vip1michaelkorsoutlet.org]Michael Kors Outlet[/url] It is made of suede and cowhide, and is simply beautiful

[url=http://www.mislouboutinsaleuk.co.uk]Christian Louboutin Sale[/url]Don feel apprehensive

[url=http://www.getfreerunaustralia.org]Nike Free Run[/url]But Christian Louboutin replica not difficult

[url=http://www.vipnikenewzealand.info]Nike NZ[/url] Should coordinate colors, and gorgeous accessories need to be avoided

[url=http://www.upnikepascherfr.info]Nike Pas Cher[/url] Extra wide ladies鈧劉 shoes are available for various occasions