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By NBF News
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UAC Nigeria Plc said it earned N5.7 billion from the sale of its stake in one its subsidiaries to South African firm -Tiger Brands Limited.

The company had sold 49 per cent of its 100 per cent stake to Tiger Brands as parts of its restructuring programme, after securing the approval of its shareholders, last year, to proceed with the sale.

Chairman of the company, Mr. Udo Udoma in a statement to its shareholders at its annual general meeting in Lagos, also disclosed that the company undertook a number of other restructuring initiatives, which in addition to other exceptional charges, cost the company about N1.5 billion.

According to him, in order to achieve the full holding company status, the company took a number of restructuring steps. 'These cost of these actions and other exceptional charges amounting to N1.5 billion are explained in the notes to the financial statements,' he said.

In the notes to the financial statements, the company said its decision to adopt a holding company structure involved the carve-out of its remaining divisions and their preparation for possible co-investment with strategic partners.

Continuing, the company stated, 'In the case of UAC Restaurants and Ghana operations, this involved fast-paced restructuring to 100 per cent franchise model, entailing termination of long-term contracts, disposal of certain moveable assets and investory.

'MDS Logistics division resolved to sell certain haulage assets to its joint venture haulage partners and third parties leading to impairment of those assets.'

The company further stated that in 2011, it entered into an agreement with Nando's International to suspend the operation of Nando's franchise in Nigeria indefinitely.

The company blamed the suspension on the failure of the operating model, adding that the agreement led to the closure of leased shops, destruction of branded foods, branded packaging and marketing items.

The company, in its 2011 financial results, recorded a turnover of N63.588 billion, rising by 21.6 per cent from N52.313 billion recorded in its 2010 financial year and net operating profit of N8.6 billion, appreciating by 22 per cent from N7.038 billion in 2010.

The company's profit before tax and extraordinary item grew by 83.03 per cent from N7.094 billion in 2010 to N12.984 billion in 2011 while profit after tax stood at N10.202 billion, rising by 87.16 per cent from N5.451 billion in 2010. The company is rewarding its shareholders with a dividend of N2.4 billion, representing N1.50 dividend per share.

Udoma said the increase in its turnover is as a result of a significant increase in volume growth achieved in Grand Cereals, UAC Foods Limited and UAC Property Development Company Plc.