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Chairman's Statement
Distinguished shareholders, ladies and gentlemen, it is my pleasure once again to welcome you on behalf of the Board of Directors to the 26th Annual General Meeting of our company. This is a great occasion as it is the first AGM after our company was listed on the floor of the Nigerian Stock Exchange. I hereby present the financial statements and scorecard for the year ended 31 December,2008.
I would like to express once again my profound appreciation to everyone who participated in the last recapitalisation exercise, we had an overwhelming response to our N5 billion Private Placement offer, which was significantly oversubscribed and the N2.4 Billion Special Placement thereafter.
We note that your overwhelming response to the offer is a clear testimony of your unwavering confidence in the Board and Management of your company. Allow me to use the medium to reaffirm Chams PLC's commitment to creating value for all stakeholders.
PREVAILING ECONOMY
It is no longer news that the global recession has affected the Nigerian economy. The business environment within the year in review has experienced unprecedented challenges, such as the flunctuation of the Naira value. This has affected the cost of goods and equipment considerably. Share value has been depressed considerably and the fall in crude oil prices and decaying infrastructure like power has not helped the operating environment.
Whilst your company is mindful of the global financial meltdown, we also note opportunities it presents to us. We are set to take advantage if the opportunities in the e-payment space by embarking on physical, human and business reconstruction. In addition, further to the decision of the Board of Directors, your company has begun the process of building infrastructure and de-emphasising its dependence on public sector projects. To this end, we have created several subsidiaries and business units: ChamsSwitch, ChamsAccess, ChamsWallet, Chams.Net and Chams Data Centre. This was achieved through increased investments in research and development.
The year 2009 may prove to be a tough year if the global economic recession is not qucikly arrested. However, at Chams, we believe that the development will not hinder our performance. We are determined to continue to assert ourselves as the dominant force in Identification, Transaction and Payment solutions in the local market place, while staying true to our vision of "Being the leading Provider of Innovative Technologies that improve the Quality of Life".
We are gladdened that the Federal Government of Nigeria has recognised and approved e-payment as the only means by which payments will be made to any contractor. This is a vindication of one of our business lines which we are pushing vigorously. At Chams, we view the various reforms instituted by the Federal Government of Nigeria towards a solid foundation for immediate and future growth with great expectations.
The following are the major highlights of your group's financial performance for the Year 2008:
Performance Milestones for 2008
The following major milestones were achieved in 2008:
1. Two mega Chams Cities were opened in 2008, these have been recognised by the Guinness Book of World Records as the biggest digital malls in the world.
2. Achievement of ISO 9001:2000 Certification, the first IT company in Nigeria to achieved such certification.
3. Share were listed on the Nigerian Stock Exchange.
4. Successfully concluded the third phase of our Chams Varsity where young graduates are trained and inducted into the company over a period of a year.
5. Your company supported the needy by providing 30,000 meals through its Soup Kitchen initiative.
NOTABLE AWARDS
Aside from earning a pride of place in the Guinness Book of World Records, our aim is to have a mega digital mall in every major city nationwide, whilst building e-payment platforms that will make life easier. Happily, our efforts are being recognised not only with more businesses but with awards and accolades.
1. Your company was nominated as the ICT Company of the year by This Day Newspapers.
2. We also won the ICT Company of the year award from Titans of Technology.
3. Chams recently won the United Nations Economic Commissions for Africa's TIGA Awards in Addis Ababa, Ethopia for her effective use of ICT for public service.
THE WORKFORCE
In our bid to implement the new strategy of building infrastructure, Chams PLC hs been undergoing reconstruction in the last 15 months. The company's workforce hs grown from 50 to 200 due to the new units and subsidaries created.
In furtherance of our goal to be the employer of choice in the Nigerian labour market, your company works tirelessly to attract, develop and retain talented staff in all her areas of operations. We remain more than ever committed to the empowerment of our employees whom we recognise as our most important assets.
To achieve this goal, the Chams Varsity initiative has successfully concluded the engagement of 73 young and brilliant graduates to replenish our work force. You will recall that the Chams Varsity initiative was developed three years ago due to the dearth of skills in the current university graduates. This initiative has enabled us to recruit smart and successful graduates from across Nigerian universities. After a year of vigourous in house training, these trainees are deployed to different departments in the company to start a fast track but challenging career path to becoming future leaders of the company.
In order to develop this programme further and to have appropriate office and manufacturing facilities, we have acquired 10.5 hectares of prime property land in Ibeju-Lekki local government area of Lagos State. The complex when completed would also serve as a technology park to be leased out to companies that offer complimentary solutions to Chams.
LISTING ON THE NIGERIAN STOCK EXCHANGE
In consonance with the desires and approval of distinguished shareholders to enlist the share of your company on the Nigerian Stock Exchange, we took steps to perfect the registration with the Securities and Exchange Commission (SEC). Permit me to congratulate you all for your unshaken support as you company made history on 2nd September, 2008 when the shares of the company were listed in a much publicized event as the 2nd ICT Company and the 1st in the identification and e-payment space to be listed on the Nigerian Stock Exchange.
Our immense gratitude goes again to the management and staff of the Securities & Exchange Commission (SEC), and the Nigerian Stock Exchange (NSE). We thank especially oir auditors Akintola Williams Deloitte, PAC Solicitors (Company Secretaries), Tax Consultants Ijewere & Co, Legal Advisers Tony Uponi & Co, First Registrars and the joint issuing houses (UBA Global Market, Skye Bank, Fidelity Bank and Santrust) who were all very helpful and supportive during the process.
QUALITY MANAGEMENT SYSTEM
In the period under review your company achieved ISO 9001:2000 certification from the Standards Organization of Nigeria (SON) thereby joining the list of the enviable companies around the globe with world best practices in processes and operational efficiency.
Solution Offerings
National Identity Management Commission (NIMC): We won the contract to provide the Identity Card and Data Management solution to the nation. We are at the threshold of finalising the contract in order for the work to commence. We strongly believe that this process will be concluded by the beginning of the third quarter of 2009.
National Health Insurance Scheme (NHIS): The card plant for the National Health Insurance Scheme was successfully implemented in December 2008. This was achieved in partnership with SuperCard Ltd. The project will provide solutions that will allow the population to acess good, modern and affordable healthcare facilities.
National Pensions Commissions (PENCOM): The project is for the supply and personalization of smart cards for Pensioners. This project will ensure that all pensioners of the Federal Government are identified. The pilot for two ministries (Education and Health) has started.
Independent National Electoral Commission (INEC): Based on our performance of delivering 70 million Voters ID Cards to INEC in 2007 and the attendant commendations by the National Council of State, our relationship with INEC has grown to be that of a preferred service partner.
We are currently working with INEC on the following projects:
1. Continuous Voters Registration solution and update of Voter's database.
2. Deployment of 37 ChamsAccess booths
3. Supply of personalisation systems for the CVR project.
SUBSIDARIES
Your company, Chams PLC and its associated entities are committed to offering complete end-to-end solution to small and large projects in the arof identification, e-payment and transactional solutions.
In 2008, we commenced the process of incorporating two new subsidaries to ofeer services to fill demand gaps in the card industry in Nigeria.
In the period under review, your company bought over the stakes of First Funds Limited (A subsidary of First Bank PLC) and Oceanic Bank in Card Centre Nigeria Limited, effectively making Chams the majority shareholder in the company. This was done with a view to recapitalising and repositioning Card Centre to face the challenges in the industry.
Chams PLC's shareholdings in the respective subsidaries now stands at: Card Centre (91%); SuperCard (85%) and Paymaster (38%), ChamsAccess (90%), Chams Switch (85%). As a group we maintain and benefit from strong business synergies that ensure that we maintain market motivated competitiveness and advantage in all our business areas. As a company, we are not over-reliant on a single source of income. Permit me to state that the gestation periof in technological based offerings are sometimes painstaking when you are a pioneer; but the results are always worth the wait.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your company is sensitive to the environment in which it carries on business. In responding to the prevailing needs in our society, a commitment was made to give back to the society through:
a) Chams Theatre Series
Your company embarked on a strategic intervention into the Arts by acquiring the rights to the works of D.O. Fagunwa's classics. To this end the renowned playwrights Professor Femi Osofisan and Professor Akinwunmi Ishola were commissioned to render English and Yoruba adaptations of the book "Ogboju Ode Ninu Igbo Irunmole" also know as "The Forest of a Thousand Daemons".
The stage performance of both adaptions were recieved with great public and critical acclaim in four cities: Lagos, Ibadan, Abuja and Ile-Ife in September, 2008. The play was a contribution of your company to the rejuvenation of the Arts and Culture in Nigeria. Apart from promoting our culture, the play provided employment for about 100 theatre practitioners and indirect employment for many more. Chams PLC has already commenced preparations for the performance of another book of the late sage.
b) Feeding the poor, hungry and needy of the society
Our company does this through voluntary contributions of resources by members of staff who carry out the cooking over night while distributing the meals at pre-determined location (s) to the less privileged and socially displaced members of the society.
Tagged "soup-kitchen"; the first in the series was held on March of 2008 at a destitute colony in Ebuta Metta area of Lagos State. The second experience took our charity work to cover the Ikoyi Prison in April of 2008.
c)Financial Assistance
Your company renders help to several individuals, the community and society at latge and to deserving causes. We also assisted some Non-Governmental Organizations by way of collaboration in the period under review.
FUTURE PERSPECTIVE
Distinguished Shareholders, it is with every sense of modesty that I assure you that your company shall continue to be innovative in solutions offering in our quest to fulfill our mission "To design and deploy innovative and beneficial technology while creating values for all stakeholders". We shall continue to exploit the emerging opportunities in your interest and for your benefit.
Permit me to state that in spite of the current economic challenges, the fundamentals of the Nigerian economy is good and can only get better. The fruits of the infrastructures being built by Chams are surely going to transform it from being a good company to a great one to your delight.
Thank you and God bless you all.
Prof. Adebayo Dada Akinde
Chairman
I would like to express once again my profound appreciation to everyone who participated in the last recapitalisation exercise, we had an overwhelming response to our N5 billion Private Placement offer, which was significantly oversubscribed and the N2.4 Billion Special Placement thereafter.
We note that your overwhelming response to the offer is a clear testimony of your unwavering confidence in the Board and Management of your company. Allow me to use the medium to reaffirm Chams PLC's commitment to creating value for all stakeholders.
PREVAILING ECONOMY
It is no longer news that the global recession has affected the Nigerian economy. The business environment within the year in review has experienced unprecedented challenges, such as the flunctuation of the Naira value. This has affected the cost of goods and equipment considerably. Share value has been depressed considerably and the fall in crude oil prices and decaying infrastructure like power has not helped the operating environment.
Whilst your company is mindful of the global financial meltdown, we also note opportunities it presents to us. We are set to take advantage if the opportunities in the e-payment space by embarking on physical, human and business reconstruction. In addition, further to the decision of the Board of Directors, your company has begun the process of building infrastructure and de-emphasising its dependence on public sector projects. To this end, we have created several subsidiaries and business units: ChamsSwitch, ChamsAccess, ChamsWallet, Chams.Net and Chams Data Centre. This was achieved through increased investments in research and development.
The year 2009 may prove to be a tough year if the global economic recession is not qucikly arrested. However, at Chams, we believe that the development will not hinder our performance. We are determined to continue to assert ourselves as the dominant force in Identification, Transaction and Payment solutions in the local market place, while staying true to our vision of "Being the leading Provider of Innovative Technologies that improve the Quality of Life".
We are gladdened that the Federal Government of Nigeria has recognised and approved e-payment as the only means by which payments will be made to any contractor. This is a vindication of one of our business lines which we are pushing vigorously. At Chams, we view the various reforms instituted by the Federal Government of Nigeria towards a solid foundation for immediate and future growth with great expectations.
The following are the major highlights of your group's financial performance for the Year 2008:
Performance Milestones for 2008
The following major milestones were achieved in 2008:
1. Two mega Chams Cities were opened in 2008, these have been recognised by the Guinness Book of World Records as the biggest digital malls in the world.
2. Achievement of ISO 9001:2000 Certification, the first IT company in Nigeria to achieved such certification.
3. Share were listed on the Nigerian Stock Exchange.
4. Successfully concluded the third phase of our Chams Varsity where young graduates are trained and inducted into the company over a period of a year.
5. Your company supported the needy by providing 30,000 meals through its Soup Kitchen initiative.
NOTABLE AWARDS
Aside from earning a pride of place in the Guinness Book of World Records, our aim is to have a mega digital mall in every major city nationwide, whilst building e-payment platforms that will make life easier. Happily, our efforts are being recognised not only with more businesses but with awards and accolades.
1. Your company was nominated as the ICT Company of the year by This Day Newspapers.
2. We also won the ICT Company of the year award from Titans of Technology.
3. Chams recently won the United Nations Economic Commissions for Africa's TIGA Awards in Addis Ababa, Ethopia for her effective use of ICT for public service.
THE WORKFORCE
In our bid to implement the new strategy of building infrastructure, Chams PLC hs been undergoing reconstruction in the last 15 months. The company's workforce hs grown from 50 to 200 due to the new units and subsidaries created.
In furtherance of our goal to be the employer of choice in the Nigerian labour market, your company works tirelessly to attract, develop and retain talented staff in all her areas of operations. We remain more than ever committed to the empowerment of our employees whom we recognise as our most important assets.
To achieve this goal, the Chams Varsity initiative has successfully concluded the engagement of 73 young and brilliant graduates to replenish our work force. You will recall that the Chams Varsity initiative was developed three years ago due to the dearth of skills in the current university graduates. This initiative has enabled us to recruit smart and successful graduates from across Nigerian universities. After a year of vigourous in house training, these trainees are deployed to different departments in the company to start a fast track but challenging career path to becoming future leaders of the company.
In order to develop this programme further and to have appropriate office and manufacturing facilities, we have acquired 10.5 hectares of prime property land in Ibeju-Lekki local government area of Lagos State. The complex when completed would also serve as a technology park to be leased out to companies that offer complimentary solutions to Chams.
LISTING ON THE NIGERIAN STOCK EXCHANGE
In consonance with the desires and approval of distinguished shareholders to enlist the share of your company on the Nigerian Stock Exchange, we took steps to perfect the registration with the Securities and Exchange Commission (SEC). Permit me to congratulate you all for your unshaken support as you company made history on 2nd September, 2008 when the shares of the company were listed in a much publicized event as the 2nd ICT Company and the 1st in the identification and e-payment space to be listed on the Nigerian Stock Exchange.
Our immense gratitude goes again to the management and staff of the Securities & Exchange Commission (SEC), and the Nigerian Stock Exchange (NSE). We thank especially oir auditors Akintola Williams Deloitte, PAC Solicitors (Company Secretaries), Tax Consultants Ijewere & Co, Legal Advisers Tony Uponi & Co, First Registrars and the joint issuing houses (UBA Global Market, Skye Bank, Fidelity Bank and Santrust) who were all very helpful and supportive during the process.
QUALITY MANAGEMENT SYSTEM
In the period under review your company achieved ISO 9001:2000 certification from the Standards Organization of Nigeria (SON) thereby joining the list of the enviable companies around the globe with world best practices in processes and operational efficiency.
Solution Offerings
National Identity Management Commission (NIMC): We won the contract to provide the Identity Card and Data Management solution to the nation. We are at the threshold of finalising the contract in order for the work to commence. We strongly believe that this process will be concluded by the beginning of the third quarter of 2009.
National Health Insurance Scheme (NHIS): The card plant for the National Health Insurance Scheme was successfully implemented in December 2008. This was achieved in partnership with SuperCard Ltd. The project will provide solutions that will allow the population to acess good, modern and affordable healthcare facilities.
National Pensions Commissions (PENCOM): The project is for the supply and personalization of smart cards for Pensioners. This project will ensure that all pensioners of the Federal Government are identified. The pilot for two ministries (Education and Health) has started.
Independent National Electoral Commission (INEC): Based on our performance of delivering 70 million Voters ID Cards to INEC in 2007 and the attendant commendations by the National Council of State, our relationship with INEC has grown to be that of a preferred service partner.
We are currently working with INEC on the following projects:
1. Continuous Voters Registration solution and update of Voter's database.
2. Deployment of 37 ChamsAccess booths
3. Supply of personalisation systems for the CVR project.
SUBSIDARIES
Your company, Chams PLC and its associated entities are committed to offering complete end-to-end solution to small and large projects in the arof identification, e-payment and transactional solutions.
In 2008, we commenced the process of incorporating two new subsidaries to ofeer services to fill demand gaps in the card industry in Nigeria.
In the period under review, your company bought over the stakes of First Funds Limited (A subsidary of First Bank PLC) and Oceanic Bank in Card Centre Nigeria Limited, effectively making Chams the majority shareholder in the company. This was done with a view to recapitalising and repositioning Card Centre to face the challenges in the industry.
Chams PLC's shareholdings in the respective subsidaries now stands at: Card Centre (91%); SuperCard (85%) and Paymaster (38%), ChamsAccess (90%), Chams Switch (85%). As a group we maintain and benefit from strong business synergies that ensure that we maintain market motivated competitiveness and advantage in all our business areas. As a company, we are not over-reliant on a single source of income. Permit me to state that the gestation periof in technological based offerings are sometimes painstaking when you are a pioneer; but the results are always worth the wait.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your company is sensitive to the environment in which it carries on business. In responding to the prevailing needs in our society, a commitment was made to give back to the society through:
a) Chams Theatre Series
Your company embarked on a strategic intervention into the Arts by acquiring the rights to the works of D.O. Fagunwa's classics. To this end the renowned playwrights Professor Femi Osofisan and Professor Akinwunmi Ishola were commissioned to render English and Yoruba adaptations of the book "Ogboju Ode Ninu Igbo Irunmole" also know as "The Forest of a Thousand Daemons".
The stage performance of both adaptions were recieved with great public and critical acclaim in four cities: Lagos, Ibadan, Abuja and Ile-Ife in September, 2008. The play was a contribution of your company to the rejuvenation of the Arts and Culture in Nigeria. Apart from promoting our culture, the play provided employment for about 100 theatre practitioners and indirect employment for many more. Chams PLC has already commenced preparations for the performance of another book of the late sage.
b) Feeding the poor, hungry and needy of the society
Our company does this through voluntary contributions of resources by members of staff who carry out the cooking over night while distributing the meals at pre-determined location (s) to the less privileged and socially displaced members of the society.
Tagged "soup-kitchen"; the first in the series was held on March of 2008 at a destitute colony in Ebuta Metta area of Lagos State. The second experience took our charity work to cover the Ikoyi Prison in April of 2008.
c)Financial Assistance
Your company renders help to several individuals, the community and society at latge and to deserving causes. We also assisted some Non-Governmental Organizations by way of collaboration in the period under review.
FUTURE PERSPECTIVE
Distinguished Shareholders, it is with every sense of modesty that I assure you that your company shall continue to be innovative in solutions offering in our quest to fulfill our mission "To design and deploy innovative and beneficial technology while creating values for all stakeholders". We shall continue to exploit the emerging opportunities in your interest and for your benefit.
Permit me to state that in spite of the current economic challenges, the fundamentals of the Nigerian economy is good and can only get better. The fruits of the infrastructures being built by Chams are surely going to transform it from being a good company to a great one to your delight.
Thank you and God bless you all.
Prof. Adebayo Dada Akinde
Chairman