Economy
BUA Foods Raises Dividend by 29% After Price Adjustment to Soak High Costs
By Dipo Olowookere
Shareholders of BUA Foods Plc will receive a higher cash reward for the 2022 financial year because the board of the organisation has proposed a higher dividend for the reporting year.
BUA Foods recently released its financial statements for 2022, and a dividend of N4.50 was declared, higher than the N3.50 paid to investors in the 2021 fiscal year by about 29 per cent.
This occurred after the company recorded a 38 per cent improvement in its profit before tax at N107.2 billion in the year under review compared with the N77.5 billion reported a year earlier, as the net profit grew by 31 per cent to N91.3 billion from the N69.8 billion posted in 2021, and the Earning Per Share (EPS) grew by 20 per cent to N5.07 from N4.24.
It was observed that despite the economic headwinds that characterised the year, especially due to the unending disruption of the business climate with high input costs and currency devaluation, BUA Foods reported an improvement in its gross earnings, majorly due to adjustments to the prices of the products.
Business Post reports that revenue grew by 26 per cent to N418.3 billion in FY 2022 from N333.2 billion 12 months earlier as a result of growth posted by its business lines, sugar, flour, and pasta.
The sugar segment of the business contributed 66 per cent to revenue in FY 2022, higher than the 64 per cent contribution in 2021, with revenue of N275.1 billion versus N209 billion in FY 2021.
This was driven by price adjustments and export sales within the period despite a decline in production due to energy disruptions.
As for the flour division, its contribution rose from 16 per cent to 20.6 per cent last year at N69.4 billion versus N85.9 billion, respectively. Price adjustments in the accounting year buoyed the growth despite a fall in the volume sold in the year.
However, the contribution of the pasta arm of BUA Foods to the revenue generated by the firm went down to 14 per cent from 20 per cent amid an 18 per cent drop in production volume to 111,578 tons from 136,859 tons as a result of energy challenges in the second quarter of the year.
According to the financial statements, increases in energy and raw materials costs pushed the cost of sales higher by 24 per cent in FY 2022 to N285.6 billion from N230.3 billion. The company said it was affected by the high input cost environment and further devaluation of the Naira against the US Dollar, which weighed heavily on prices for raw materials and aggravated the cost of production.
However, this did not suppress the gross profit, which rose by 29 per cent to N132.8 billion from N103 billion because the firm passed this cost to the consumers as it hiked the prices of its products.
Also, despite the 28 per cent jump in administrative expenses due to the increase in general expenses, and a 33 per cent leap in total operating expenses in the year, BUA Foods closed December 31, 2022, with an operating profit of N117.5 billion compared to N79.8 billion achieved in 2021.
Commenting on the performance of the organisation, the Managing Director of BUA Foods, Mr Ayodele Abioye, said, “BUA Foods Plc continued to maintain her leading position as the most profitable Foods and FMCG listed company in Nigeria with PBT of N107.2 billion, a growth of 38 per cent in the prior year.
“This is despite the unending disruption of the business climate with high input costs and currency devaluation resulting in increased operational costs.
“We remain resolute to navigate the numerous business headwinds to continue delivering double-digit growth with a sustained focus on our market expansion strategy across our business segments.
“Delivering long-term values to all our stakeholders as we continue to nourish lives remains cardinal.”
By Adedapo Adesanya
Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.
Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.
This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.
Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.
Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.
At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.
InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Dipo Olowookere
The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.
This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.
UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.
On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.
Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.
Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.
A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.
This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.
For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.
By Adedapo Adesanya
The Naira marginally depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, December 4 amid renewed forex pressure associated with December.
At the official market yesterday, the Nigerian currency lost 0.01 per cent or 18 Kobo against the Dollar to close at N1,447.83/$1 compared with the previous day’s N1,447.65/$1.
It was not a different scenario with the local currency in the same market segment against the Pound Sterling as it further shed N15.43 to sell for N1,930.97/£1 versus Wednesday’s closing price of N1,925.08/£1 and declined against the Euro by 20 Kobo to finish at N1,688.74/€1 compared with the preceding session’s N1,688.54/€1.
Similarly, the Nigerian Naira lost N5 against the greenback in the black market to quote at N1,465/$1 compared with the previous day’s value of N1,460/$1 but closed flat against the Dollar at the GTBank FX counter at N1,453/$1.
Fluctuations in trading range is expected to continue during the festive season as traders expect the Nigerian currency to be stable, supported by intervention s by to the Central Bank of Nigeria (CBN)in the face of steady dollar demand.
Support is also expected in coming weeks as seasonal activities, particularly the stylised “Detty December” festivities, will see inflows that will give the Naira a boost after it depreciated mildly last month, according to a new report.
“As the festive Detty December season intensifies, inbound travel, tourism spending, and diaspora inflows are expected to provide moderate support for FX liquidity,” analysts at the research unit of FMDA said in its latest monthly report for November.
Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450 next week, buoyed by improved FX interventions by the apex bank.
Meanwhile, the crypto market was down as the US Federal Reserve’s preferred inflation gauge, core PCE, likely rose in September—moving in the wrong direction. However, volatility indices show no signs of major turbulence.
If the actual figure matches estimates, it would mark 55 straight months of inflation above the US central bank’s 2 per cent target. The sticky inflation would strengthen the hawkish policymakers, who are in favour of slower rate cuts.
Ripple (XRP) depreciated by 4.5 per cent to $2.08, Solana (SOL) went down by 3.8 per cent to $138.11, Litecoin (LTC) shrank by 3.1 per cent to $83.23, Dogecoin (DOGE) slid by 2.5 per cent to $0.1463, Cardano (ADA) declined by 2.1 per cent to $0.4368, Bitcoin (BTC) fell by 0.9 per cent to $91,975.45, Binance Coin (BNB) crumbled by 0.9 per cent to $899.41, and Ethereum (ETH) dropped by 0.7 per cent to $3,156.44, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
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