BUA Foods’ after-tax profit surges 91% on other income

BUA Foods, a fast-moving consumer goods firm, recorded a 91 percent after-tax profit surge in the nine months of 2024, driven by growth in the other income.

The firm’s other income grew to N25.17 billion in the nine months of 2024 from N1.29 billion in the similar period of 2023.

BUA Foods’ after-tax profit increased to N201.4 billion from N105.6 billion in the corresponding period of 2023.

“We are thrilled to have sustained a remarkable growth trajectory, underscoring the impact of our strategy, innovative product development, and steadfast commitment to quality, even in the face of a challenging business climate,” Ayodele Abioye, managing director of BUA Foods, said.

“We saw the benefits of our production capacity expansion and product innovation, as we witnessed an 11 percent growth in aggregate volume which has further strengthened our position within the industry,” he said.

“Looking ahead, we will remain steadfast in addressing current food supply challenges by leveraging newly commercialised supply chain assets across our business divisions,” he stated. “We would maintain focus on driving internal efficiencies for business growth towards delivering long-term shareholder value.”

Revenue surged 104 percent to N1.07 trillion from N524.4 billion in 2023, while input cost grew to N736.9 billion from N340.6 billion.

Cost of sales increased by 116 percent, 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 of raw materials. This resulted in a higher cost of production,” BUA Foods said in its earnings release statement.

Selling and distribution expenses jumped 45 percent to N29.31 billion in the nine months of 2024 from N20.27 billion in the same period of 2023, due to increase in cost of diesel within the period.

The firm’s administrative expenses grew 84 percent to N14.54 billion from N7.91 billion. Total operating expenses during the period increased 56 percent to N43.86 billion from N28.18 billion which was driven by increase in selling and distribution cost along the supply chain to customers.

Read also: BUA Foods expands capacity to reduce food scarcity

One of the company’s 2025 goals is to become Nigeria’s biggest flour and pasta miller after signing strategic agreements with Turkish and Italian firms to increase its pasta production capacity to 900, 000 metric tonnes per annum and flour to 2.5 million metric tonnes per annum.

Recently, BUA Foods emerged as the first Nigerian company to be honored with the prestigious ‘Company of the Year’ award at the 2024 All Africa Business Leaders Awards in partnership with CNBC in South Africa.

The firm also received the ‘Most Valuable Indigenous Food Company of the Year’ award, the ‘Customer-centric FMCG Corporate Brand of the Year’ award, while its IRS Premium Wheat Flour was named ‘Flour Brand of the Year 2024.’

BUA Foods share price stood at N355.5 on Monday from N227.5 at the beginning of the year.

BUA Foods plc is a Nigerian company based in Lagos. It is part of the Nigerian BUA conglomerate. Its business activities include the production, processing and distribution of food products through its sugar, flour, pasta, rice and edible oils divisions.