Cadbury Nigeria, a listed food and beverage maker of the Nigerian Stock Exchange (NSE), made a loss in the third quarter of 2019, but the company could grow its bottom-line more than it did in 2018 business year after combined profit in the nine months of 2019 grew more than 200 percent.
With a profit of N648 million in the three quarters of 2019 already reported, Cadbury has an annualized profit of N864 million, which is about five percent more than its 2018 full-year profit.
However, things could get better or worse for the company which mitigated loss in the third quarter of 2019 on account of a tax credit, and had grown profit by 174 percent in 2018.
Momentum of Cadbury Nigeria, the local subsidiary of the United Kingdom firm, has slowed in the last three months to September after recording its best half-year performance in the last five years.
In the three quarters of 2019, Cadbury’s revenue grew by 7 percent to N28.91 billion, against faster revenue which rose by about 11 percent last year.
Revenue in 2019 has been driven by sales in Cadbury’s beverage business which grew by about 12 percent in the three-quarter period, and contributed 60 percent to revenue compared to 57 percent in the same period last year.
Confectionaries contributed approximately 29 percent to revenue and grew faster by 16 percent while intermediate cocoa products, the smallest revenue segment, suffered a decline in sales.
In the nine months, Cadbury grew its gross profit, also referred to as top-line by 10.39 percent to N5.86 billion.
The performance meant that the food and beverage maker retained N20.3 out of every N100 sales as gross profit compared to N19.7 in the year before, as growth in sales outpaced increase in cost of sales.
Other income rose by 47 percent to N58.43 million while Cadbury saw selling and distribution expenses rise by 12 percent and administrative expenses rose marginally less than 1 percent.
Profit from operating activities, which is the profit from business operations before deduction of interest and taxes, rose 19.5 percent to N811.94 million.
Cadbury saw a net finance income of N113.81 million, from a loss of N426.44 million last year, on the back of a 14 percent growth in finance income to N113.81 while there was no interest expense interest expense in the period, an improvement from half a billion incurred in the previous year.
Profit before tax was only N75 million shy of a billion naira mark after it grew by more-than-double of N252.79 million recorded last year.
Tax expenses saw a big increase bringing profit attributable to each unit of Cadbury share to N35 compared to N32 in the same period of 2018.
SEGUN ADAMS
