- BUA Foods records 23% PAT increase to N112.1bn, pays N5.50 dividend
Investors’ wealth declined by N190.45 billion on Wednesday as the equities market capitalization dropped to N58.91 trillion.
As a result, the year-to-date return fell to 39.33 percent.
Meanwhile the naira continues on the winning path against the dollar at the foreign exchange market, strengthening by 1.23 percent in the foreign exchange market, ending at ₦1,262.85 per dollar in the official market.
In the Parallel market, the naira closed at ₦1,274 to the dollar.
The negative sentiment continued in the local market as the All-share index dipped by 0.32 percent to settle at 104,181.32 points. Selloffs of GTCO (-1.23%), Zenith Bank Plc (-1.23%) and FBN Holdings Plc (-5.02%) outweighed gains Dangote Sugar Refinery (+1.35%), FlourMills of Nigeria Plc (+0.64%) and JBERGER (+0.08%).
Analysis of Wednesday’s market activities showed trade turnover settled lower relative to the previous session, with the value of transactions down by 39.04 percent. A total of 405.03 million shares valued at ₦8.91 billion were exchanged in 10,364 deals. ACCESSCORP (-4.20%) led the volume chart with 50.00 million units traded while ZENITHBANK (-1.23%) led the value chart in deals worth ₦1.86 billion.
Market breadth closed negative at a 0.63-to-1 ratio with declining issues outnumbering the advancing ones. INTENEGINS (-10.00%) topped thirty-one (31) others on the laggard’s table while UPL (+9.84%) led nineteen (19) others on the leader’s log.
In the money market, the Overnight NIBOR plunged by 88bps to close lower at 23.25 percent, indicating improved liquidity. In contrast, prominent money market rates like the open repo rate (OPR) and overnight lending rate (OVN) increased by 187bps and 26bps to close at 25.34 percent and 25.18 percent, respectively.
In the Nigerian Interbank Treasury Bills market, the Nigerian Interbank Treasury Bills True Yield (NITTY) exhibited a mixed trend. The 1-month and 12-month NITTY advanced by 17bps and 8bps, while the 3-month and 6-month NITTY declined by 29bps and 8bps, respectively.
The secondary market for Nigerian Treasury Bills saw a positive trading, and as a result, the average yield declined by 6bps to 16.76 percent.
In the secondary market for FGN Bonds, positive trading activity led to a decrease in the average yield by 0.03 percent to 19.29 percent.
In Nigeria’s sovereign Eurobonds market, notable bullish sentiment led to significant positive activity across all yield curve segments, resulting in a 5 basis points decrease in the average yield to 9.65 percent.
BUA Foods records 23% PAT increase to N112.1bn, pays N5.50 dividend
BUA Foods sustained growth performance amidst headwinds in the financial year ended December 31, 2023, delivering a gross profit increase of 96 percent to N260 billion.
Profit after tax grew by 23 percent to N112.1 billion for 12M 2023 while turnover grew by 74 percent to N729.4 billion.
The shareholders of the company will be paid a final dividend of N5.50 per share for the audited financial.
This was due to a y-o-y increase of 54 percent in Sugar to ₦422.5 billion (12M 2022: ₦275.2 billion), 152 percent in Flour to ₦216.9 billion (12M 2022: ₦85.9 billion), and 54 percent in Pasta to ₦87.9 billion (12M 2022: ₦57.2 billion).
Increase in cost of sales (+64%) to ₦468.98 billion in 12M 2023 (12M 2022: ₦285.55 billion) was driven by an increase in raw materials cost and energy cost. The high input cost environment and further devaluation of the Naira against the US Dollar weighed heavily on prices for raw materials. This resulted in higher cost of production.
Gross profit increased by 96 percent to ₦260.45 billion in 12M 2023 (12M 2022: ₦132.79 billion) even as gross profit margin appreciated by 400bps to 35.7 percent in 12M 2023 (12M 2022: 31.7%) due to the slight selling price adjustment within the year.
Selling and distribution expenses increased by 110 percent to ₦29.84 billion in 12M 2023 (12M 2022: ₦14.1 billion)due to huge increase in cost of diesel within the period.
Administrative expenses also declined by 8 percent to ₦17.21 billion in 12M 2023 (12M 2022: ₦21 billion). Total operating expenses increased by 43 percent to ₦47.06 billion in 12M 2023 (12M 2022: ₦32.9 billion) on the back of increase in selling and distribution cost along the supply chain to customers.
EBITDA increased by 74 percent to ₦215.6 billion in 12M 2023 (12M 2022: ₦124.1 billion), driven by growth in gross profit. Also, EBITDA margin appreciated by 20bps to 29.6% in 12M 2023 (12M 2022: 29.4%).
Commenting on the results, Ayodele Abioye, the Managing Director, said, “2023 witnessed a very challenging operating environment characterized by macroeconomic headwinds. We were able to navigate these challenges leveraging our unique strategic business model to deliver a strong performance as the top line grew by as much as 74%, with gross profit leaping by 96% while total assets increased significantly. This is a reaffirmation of our commitment to drive shareholder value underpinned by our unique capabilities as a strong, diversified and scalable food business. Expansion efforts across all frontiers continue to crystallize in supporting growth as we accelerate our strategy to become a leading food brand on the continent. We continue to drive efficiency through our integrated supply chain system by leveraging economies of scale in alignment with market expansion efforts towards fulfilling the increasing demand of customers. Looking ahead, we remain committed to unlocking opportunities for sustained and improved business performance while being confident in our strategic plans for the year 2024. Creating long-term value for all stakeholders is an imperative, even as we stay true to our creed of nourishing lives.”
