Smuggling impedes operations of local manufacturers

Story: Boahene Asamoah

THE Chief Executive Officer of Unilever Ghana Limited, Mr Charles Cofie has bemoaned the high influx of smuggled goods into the country that has greatly affected the operations of the industry in the country.
He has, therefore, called on the authorities to adopt strategies that will ensure a level playing field to create fair competition in the country.
Speaking at the ‘facts behind the figures’ programme of the Ghana Stock Exchange in Accra last week, Mr Cofie said “counterfeits remain a common feature of the competitive environment, as well as low price competition”.
He cautioned that as the country was opening for investments there was the need to safeguard against smuggling which leads to price under cutting and consequently loss of revenue to the state.
Mr Cofie stated that while industry welcomes fair competition it was important to ensure a level playing field that would ensure that the country as a whole benefitted from taxes, adding that “we welcome fair compeition”.
Giving the financial performance of the company for the year 2007, Mr Cofie said the company achieved a 17.4 per cent growth in revenue amounting to GH¢139 million.
“This excellent performance was driven by exceptional growth in our export operations particularly in Spreads and orals”, he stated, adding that operating margins had improved from 11.2 per cent to 13.1 per cent.
The chief executive said profit after tax for the year also stood at GH¢12.4 million representing a 6.9 per cent improvement over that of 2006.
“This represents a very strong performance which has been driven by strong growth, improved margins and lower tax charge”, Mr Cofie stated.
Mr Cofie mentioned that the Home and Personal Care (HPC) division delivered 20 per cent growth adding that “our focus on high value product mixes and the drive behind exports also contributed significantly towards this strong HPC performance.
The Oral Division, which includes pepsodent and close up, grew by a 45 per cent drive, while personal wash category also grew up by 18 per cent buoyed by Geisha, lux and lifebuoy.
On the foods division, Mr Cofie stated that the company faced strong competition and cost pressures in this division, stating that high cost increase in crude palm oil and supply constraints resulted in significant pressures on margins and our ability to supply the market.
“In spite of this challenge we recorded good growth in spreads of 47.6 per cent, while cooking oil also grew by 5.4 per cent in line with the company’s strategy”, he stated.
On the outlook of the company he said “we will seek to improve on our shareholder value by consolidating our growth, improving the portfolio and containing costs, thereby improving margins”.