Product details

Cadbury Nigeria was incorporated in 1965 as a 100% owned subsidiary of Cadbury Schweppes UK. It was widely regarded as a leading producer of candy, gum and food beverages in Nigeria and West African. It also owned Stanmark Cocoa Processing Company Ltd, which produced cocoa products for local use and for export. Cadbury Nigeria was an active and popular stock on the Nigerian Stock Exchange. Its headquarters was in Lagos and it employed around 2,300 people in 2006. Its 2005 accounts disclosed turnover of £122 million and profit before tax of £22 million. Corresponding half-year figures for 2006 were £49 million and £3 million respectively. Cadbury Nigeria was reported as an associated company in the group accounts of Cadbury Schweppes in 2005, but was reported as a fully consolidated subsidiary from 28 February to the 30 June in its half year reports. In December 2006 it was announced that Cadbury Nigeria Plc had overstated its accounts in 2005 and that consequently, Mr Bunmi Oni, the CEO and Mr Akadiri, the Finance Director had been sacked in Bournemouth, UK by Cadbury Schweppes UK. Mr Oni had just received in 2006 an award as ‘Chief Executive of the Year 2006’ or ‘The most respected CEO in Nigeria’. On account of this, Cadbury Nigeria Plc reported an underlying operating loss for 2006 of between N1 and N2 billion and made exceptional charges in 2006 of between N13 billion and N15 billion in respect of the profit and balance sheet overstatements. A Securities Exchange Commission Administrative Panel to which the matter was referred concluded that the company’s former managing director, in concert with the company’s Board since the year 2002 used stock buy backs, cost deferrals, trade loading and false suppliers stock certificates to manipulate its financial reports that were issued to the public. In consequence the Company was fined and its directors, audit committee members and senior management staff were banned or suspended from serving as directors of quoted companies for a period of time. The Company’s auditors and Registrars were fined, reprimanded and warned to be more diligent in carrying out their professional duties. Avid followers of corporate activities and the stock market in Nigeria received the news with shock and bewilderment. Mr. Oni asserted that no personal financial gain or misappropriation of funds occurred. He laid blame on Cadbury Schweppes for saddling its Nigeria subsidiary with a defective turn-key plant, forcing responsibility of the loss on Cadbury Nigeria, which temporarily deferred the costs but had to disclose it in the accounts when its recovery through trading activities became impossible.