UACN grows half-year pre-tax profit by 25.3%

UAC of Nigeria Plc has announced its unaudited results for the half year (H1) ended 30 June 2021.

The N46.5billion which the company’s revenue printed in H1’21 was 27percent ahead of H1 2020 of N36.63billion, driven by sales growth across all business segments.

Also, gross profit of N8.3billion represents 19percent higher than H1 2020 at N6.9billion. Profit before tax (PBT) of N1.29billion in H1’21 against N1.03billion in H1’20, represents an increase of 25.3percent.

Its gross margin of 17.9percent H1’21 against 19.1percent in H1’20 came 119 basis points (bps) lower due to rising raw material costs and supply chain disruptions, particularly in the Paints segment, limiting ability to meet demand.

Read also: NETCO posts N3.37bn profit for 2020

UACN’s H1’21 operating profit of N1.7 billion, up by 105percent against N828million in H1’20 was supported by revenue growth.

Profit after tax (PAT) from continuing operations was N765 million in H1’21, up 258percent from N214 million in H1 2020. Earnings Per Share (EPS) from continuing operations was 5 kobo, an improvement from 7 kobo Loss Per Share (LPS) in H1 2020. In H1 2020, UAC recorded N944 million profit from discontinued operations which impacts year on year comparison.

Subsidiary company highlights

Chemical and Allied Products Plc and Portland Paints and Products Nigeria Plc completed merger in H1’21.

UACN received preliminary regulatory approval to unbundle 649 million UPDC REIT units, valued at N3.7 billion as at 30 June 2021, to UAC shareholders. Completion is subject to shareholder approval, final regulatory approvals, as well as sanction of the court.

Commenting on the results, Group Managing Director, Fola Aiyesimoju, stated: “We are gaining traction in our focus on growth. Higher sales across all our operating platforms translated to 27Percent revenue growth year on year. Price increases and operational efficiency offset input cost escalation resulting in 105percent increase in operating profit. Profit before tax is

25 percent higher year-on-year. Net income was negatively impacted by losses from UPDC PLC and MDS Logistics Limited and we are working with our partners to restore these companies to profitability.”