CHAIRMAN'S STATEMENT 2020.
ANNUAL GENERAL MEETING FOR THE FINANCIAL YEAR 2020
My fellow Shareholders, fellow Directors, Distinguished Guests, Ladies and
Gentlemen, I am delighted to welcome you to the annual general meeting
(AGM)of our Company to present to you the Directors Reports for the year
ending 31st December 2020.
We began the year unsure of the effects and severity of disruptions from
the then newly announced Covid-19 pandemic on our Country, our
customers both within and outside Tanzania, our employees and ultimately
our Company. However, we ended the year more certain than ever of the
essential and life-saving nature of our products, and more specifically
medical oxygen in treating covid-19 patients in the country, cementing our
Company’s importance in the society.
Year 2020 presented a handful of challenges and opportunities too, not
only to our Company but globally, Our Company has proved resilient and
adaptive has continued to be responsive to the needs of its market
environment. I thank our employees for adapting accordingly and
delivering uninterrupted supplies of unprecedented demand for medical as
well as industrial gases to our customers across our regional market when
they need us most.
Performance for the financial year 2020improved marginally compared to
that of 2019.Revenue for the year grewby 15% from Tshs 17.2Bn recorded
in 2019 to Tshs19.8Bn. Profit before tax grewby 24% from Tshs3.0Bn in
2019 to Tshs 3.8Bn in 2020. Profit after tax grewby 4% from 2.2Bn
recorded in 2019 to Tshs 2.3Bn in financial year 2020.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) for
the year 2020 was Tshs6.6Bn, 6% higher than 2019’s EBITDA of Tshs6.2
Bn. EBITDA margin for 2020 financial year was 33%.
Even as the country and the region at large gears for vaccinating their
citizens, it should be comforting to our customers and other stakeholders
that our Company is ready to support medical oxygen requirements in the
country. Our just concluded installation of the new air separation plant
capable of supplying the country with the necessary medical as well as
industrial oxygen and nitrogen is testament to this readiness.
The new plant is expected to increase the overall profitability of the
Company moving forward considering that the plant is replacing the
perennial loss maker that is Aspen 1000.
On another development, buoyed by the positive development of the
carbon dioxide market both locally and SADC countries of Zimbabwe,
Zambia and DRC, the Board has embarked on building a new additional
factory in Rungwe District to add production capacity. Alongside the new
carbon dioxide factory, the Board has committed to invest in additional
fleet commensurate with the new production capacity. This is welcome
development to our shareholders but more importantly to our esteemed
customers seeking TOL’s commitment to supplying their carbon dioxide
requirements reliably.
With the investment in both new air separation plant for the production of
liquid oxygen and nitrogen as well as the additional carbon dioxide factory,
TOL will become a solidly reliable manufacturer and distributor of medical
and industrial gases in Tanzania as well as SADC, and for our shareholders
a valid expectation of significantly increased profitability going forward.
The Board remains committed to maintaining a consistency of expectations
from our shareholders when it comes to dividends. It is for this reason that
the Board recommends a dividend payment of Tshs 34.78 per share
doubling the Tshs 17.37 per share pay out last year.
Vote of thanks
I would like to take this opportunity to once again sincerely thank our staff
members for their commitment and dedication to our Company, Board of
Directors, and Management and to our valued customers and all
stakeholders for their support in what was extraordinarily challenging year. I look forward to your continued support in the financial year 2021
and beyond.
Thank you all and God bless you
Michael N. Shirima
BOARD CHAIRMAN.
