Since its establishment in 2006, Galaxy Backbone (GBB), has always faced financial challenges; especially as the organisation’s poor revenue drive resulted in an inability to meets its financial obligations.
However, the narrative changed with the appointment of Professor Muhammad Bello Abubakar as the Managing Director/Chief Executive Officer (CEO) of Galaxy Backbone Limited (GBB) on December 23, 2019.
When Professor Abubakar took office on January 2, 2020, GBB through the Business Plan Galaxy 3.0 has been able to summount the challenge and moved ahead to change the hitherto narrative.
The Business Plan is aligned with the mandate of Galaxy Backbone and key strategic policies of the Federal Ministry of Communications and Digital Economy.
It aims to improve GBB’s delivery of its mandate, support the objectives of national policies such as the National Digital Economy Policy and Strategy (NDEPS), Nigerian National Broadband Plan (NNBP), Nigerian eGovernment Masterplan, and collaborate with technology partners to deliver value.
The Business Plan focuses on enabling Galaxy Backbone to play a role in achieving the priorities of the government as set by the Gederal Ministry of Communication and Digital Economy.
Sales for 2019 was N6.047 billion. With the outbreak of COVID 19 in 2020 resulting in low business and human activities nationally and globally, Professor Abubakar still led GBB to sustain the sales levels of 2019 at N6.0bn in 2020 even in the face of galloping COVID 19 Pandemic. In same year, many businesses went down.
However, with the right processes, people and technology in place, sales grew to N8.634Bn in 2021 representing 44% over 2020 performance. Again, 2022 sales performance at N10.475Bn compared with N8.634Bn in 2021 recorded another impressive growth of 21.32%
In other words, in the 3 years of Professor Abubakar, average annual sales of N8.37Bn recorded 38.47% growth over the 2019 àgure of N6.047Bn. In the same vein, non- mandate sales have recorded impressive growth, rising from N2Bn in 2020 to N3.034Bn in 2021 and N6.275Bn in 2022.
These impressive sales records are as a result of the visionary leadership of the new administration that saw to the creation of additional business generation facing units such as Enterprise Business (EB), Regional Office (RO) and Research, Digital, Innovative and Skills (RDIS) departments.
Professor Abubakar has shown a consistent track record of growing revenue for the organisation. The revenue growth from N7.075Bn in 2019 to N8.936Bn recorded in 2022 is a testament to his strategic leadership, innovative ideas, and effective implementation of revenue generation initiatives.
This growth is particularly impressive given the challenging economic and business landscape in the country. It also reáects the organization’s ability to adapt to changing market dynamics and leverage new opportunities for revenue generation.
With this impressive growth trend, Professor Abubakar has demonstrated his commitment to driving sustainable growth for the organisation, creating value for stakeholders, and contributing to the economic development of the country.
Professor Abubakar implemented a series of innovative initiatives and cost-saving measures that resulted in N4.4 billion in savings between 2020 and 2022. The bulk of these savings were achieved by renegotiating contracts with vendors, bulk purchases, and eliminating third-party vendors in the value chain. This was done with a focus on improved service delivery and customer satisfaction.
In addition to the financial performance, there are other signiàcant contributions by GBB, including facilitating virtual Federal Executive Council (FEC)/Council of States meetings and many other bilateral and multilateral meetings, estimated to have saved the Federal Government between N3 billion – N5 billion.
Furthermore, managing the key Government asset (NICTIB) was done without additional financing.
The value proposition of GBB’s services goes beyond cost savings and financial performance. The security component of providing safe and secure storage for key government data is a critical aspect that has not been fully articulated in naira terms.
Upon assuming office Professor Abubakar was faced with a significant challenge of outstanding debts owed by GBB, which negatively impacted its financial stability and creditworthiness.
These outstanding financial
obligations are categorized and detailed as follows:
- Loans: The current management inherited a Stanbic IBTC loan of $1.73m (about N529m) which was due for full liquidation by 2019 but kept being rescheduled by previous management with consequent interest implications and integrity issues.
To remove the burden and other negative effects of the outstanding loan, the MD/CEO ensured the full liquidation of the inherited loan of N529 Million Naira as at 3rd December 2020 including its associated costs. No new loan was taken, and Galaxy Backbone is now bank loan free.
- Withholding Tax (WHT) Obligations:
With respect to WHT, Professor Abubakar inherited a backlog of WHT tax obligations of N294m. This was WHT deducted from vendors but not remitted by previous administration. In
exercise of the current administration’s corporate disposition, management ensured that deduction and remittance of statutory obligations be a priority.
To put this to effect, the MD/CEO instructed that all current statutory remittances be paid while arrangement be put in place for the gradual liquidation of the inherited amount.
By the end of 2022, Galaxy Backbone has not only fully liquidated the inherited backlog of statutory remittances but ensure that the organization is up to date with current deductions and remittances.
iii. Other Statutory remittances. All other statutory remittances/returns were made as at when due. Thus, no remittances are outstanding relating to PAYE, VAT, and pension. Inherited outstanding to trade creditors (vendors) to the tune of N2.137bn were also paid off.
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