Despite Nigeria’s tough business environment, BUA Foods, a fast-moving consumer goods company, recorded a 182.8 percent growth in its cash and cash equivalents for the first half of 2023.
BusinessDay analysis of the company’s financial statements show that its cash and cash equivalents rose to N65.9 billion in H1 2023 from N23.28 billion in the same period of 2022.
Cash and cash equivalents are the most liquid current assets found on a business’s balance sheet. They include cash in hand, deposits held at call with banks and other short-term highly liquid investments with original maturities of three months or less that are readily convertible to a known amount of cash.
“The company continues to deliver solid growth across key business metrics in spite of social, economic, and political headwinds,” Ayodele Abioye, managing director at BUA Foods, said.
“We have sustained returns by consistently executing our unique business strategy through a strong value proposition, expanding frontiers from a market and product offering standpoint with a view to sustain profitable leadership in our sector to create long-term value for our stakeholders,” he added.
Further analysis of the firm’s financial statements revealed that profit after tax grew to N95.2 billion from N39.3 billion. Net revenue was N320.9 billion, up from N168.9 billion, while cost of sales rose to N188.1 billion from N116.8 billion.
“The rise in the cost of sales was driven by an increase in raw materials cost, factory expenses, and energy cost. The high input cost environment continues to result in higher cost of production,” the company said in a note.
Its other income grew to N896.6 million from N895.2 million. Salaries, wages, and benefit expenses rose to N1.15 billion from N536.6 million, while staff welfare and training also increased to N48.6 million from N12.6 million.
According to the firm, selling and distribution expenses increased by over 200 percent to N12.8 billion as a result of an increase in transportation and logistics to support sales expansion plans while pushing volume.
Administrative expenses rose to N5.01 billion from N1.9 billion. Total assets were N757.9 billion, up from N607.2 billion in full year 2022.
Total liabilities grew 14.7 percent to N431.7 billion.
The firm’s outlook for the year includes double-digit growth in revenue, double-digit growth in profit after tax, and earning per share growth by a minimum of 10 percent.