CPC, Aluworks face December delisting over negative performance

Two companies on the Ghana Stock Exchange, Aluworks and the Cocoa Processing Company could be delisted by December 2018 over lack of compliance.

The Cocoa Processing Company which was suspended from trading in August 2017 has for the past three years failed to submit audited financial and operational results.

It was put on a watch list in December 2017 after it promised to comply with the GSE directive to submit the results which have been outstanding for 2015, 2016 and 2017.

As of May 2017, CPC owed some syndicated banks $20m. CPC has told the Stock Exchange, it does not have a full board of directors to sign the accounts.

The company which listed on the GSE in February 2003 could have its 15 years stay on the Exchange come to an end by December 2018 with its current financial difficulties.

Photo: Products manufactured by the Cocoa Processing Company

The unionised staff would, however, be pleased with the delisting because it could pave way for the government to bail out the company which is already 90% government owned. It is illegal for the government to come to the aid of a publicly traded company.

Another company, Aluworks which has been on the GSE since November 1996 and started with a share price of ¢ 0.135 is also yet to "resolve working capital difficulties".

In 2013, Aluworks tried to raise ¢30m after floating shares but could only get ¢7.23 million. The company in May 2016 was reportedly closing in on a US$25million strategic investment deal with a big player, Vendata Resources.

Despite the financial struggles, the company has promised to resolve the challenge by September in default of which the GSE will delist it, a statement from the GSE said.

Managing Director of Aluworks, Kwasi Okoh, has blamed the company's struggles on unfair trade practices. He said Ghana has become a dumping ground for cheaper aluminium products, particularly from China and Nigeria.

Aluworks trades in aluminium sheets, coils, corrugated roofing sheets, louvre blades, etc.

But the MD has promised to bounce back and improve its standing on the Ghana Stock Exchange.

"We use to be the darling boy of the stock exchange, we will be back to our formal status”, Kwasi Okoh said in May after GSE repeated delisting threats.

A third Clidestone Ghana Limited, is still on the GSE's watchlist.

The criteria for listing include capital adequacy, profitability, spread of shares, years of existence and management efficiency.

Read full GSE statement

PRESS RELEASE PR. No. 363/2018

UPDATE ON COMPANIES ON GHANA STOCK EXCHANGE WATCH LIST

The GSE’s PR. No. 448/2017 of December 27, 2017 as per the attached refers. The following update is hereby provided in respect of the companies that were put on a watch-list from December 27, 2017.

1. Aluworks Limited (ALW)

ALW has informed the GSE of discussions with two major shareholders in resolving its working capital difficulties, among others. According to ALW, a closure to the discussions is expected in the coming weeks, latest September 2018. If at the close of December 2018, the working capital difficulties persist or there are no clear plans for resolution of the difficulties, then a decision will be taken to de-list the company from the GSE’s Main Market. ALW shall, therefore, continue to be on the watch list till then.

2. Cocoa Processing Company Limited (CPC)

In February 2018, the Chief Executive Officer and Management of CPC took their turn on the

GSE’s “Facts behind the Figures” programme to present to the market and the general investing public, their operational and financial performance over the last three years, 2015 to 2017. More importantly, the occasion was to bring to the attention of the investing public, the company’s plans to return to a more positive performance. CPC also promised to submit all the financial results that were in arrears.

CPC is, however, yet to submit those audited results relating to years ended September 2015, 2016 and 2017 and has cited the fact that it does not have a full complement of board of directors for the purpose of approving and signing those audited accounts. The company will, therefore, continue to be on the watch list up to the end of December 2018 and if the issues of non-submission of results and negative performance are not addressed by then, it will be compulsorily de-listed from the GSE’s Main Market.

3. Clydestone Ghana Limited (CLYD)

CLYD, represented by the Chief Executive Officer, other directors and executives came on the “Facts behind the Figures” programme in June 2018. The presentation threw light on the current operations of the company.

The CEO highlighted prospects they envisage in the short to medium term including new businesses as well as improvement in bottom line which they believe will be sustained going forward.

For first quarter to March 2018 and the half year to June 2018, the company’s revenue improved compared to the same period of 2017. It recorded GH¢1.55 million and GH¢2.90 million respectively. CLYD also recorded profit after tax for Q1 2018 of GH¢111,500 (loss of GH¢126,300 for Q1 of 2017) and a profit after tax for the half year to June 2018 of GH¢105,400 (loss of GH¢126,300 for the same period in 2017).

On the basis of the foregoing, Clydestone’s “Watch List” status will be maintained but lifted at the end of September 2018 if the improvement seen is sustained.

Issued in Accra, this 16^thday of August, 2018.

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