Economy
Flour Mills Increases Dividend Payout by 30% as Revenue Hits N1.2trn
By Dipo Olowookere
The board of Flour Mills of Nigeria Plc is proposing to pay shareholders of the company a dividend of N2.15 per unit for its 2022 financial year, which ended on March 31, 2022. This amount is higher than the N1.65 paid in the previous accounting period, reflecting an increase in dividend payout by 30.3 per cent.
The firm, in its audited results released on Tuesday, said the year under review was profitable as the pre-tax profit jumped by 10.48 per cent to N41.1 billion from N37.2 billion, while the net profit appreciated by 8.95 per cent to N28.0 billion from N25.7 billion, with the earnings per share (EPS) at N6.26 compared with the previous year’s N6.38.
Analysis of the results revealed that in the fiscal year, Flour Mills posted an annual turnover of N1.2 trillion in contrast to the N771.6 billion achieved a year earlier and this was largely due to improvement in the earnings from the sale of goods. It also recorded a significant improvement in income from the services it rendered in the period under consideration as it accounted for N45.6 billion versus the N29.2 billion earned from the same income stream in 2021, which is mainly from support services.
From the revenue generated in FY 2022, the food business raked in N748.8 billion versus N478.3 billion last year, the agro-allied business, which involves the sale of Golden Penny Vegetable Oil, Soya Oil and Margarine products, the company generated N213.4 billion as against the N139.4 billion a year earlier, while the sugar arm of the organisation contributed N156.0 billion to the total earnings compared with the N124.6 billion in FY 2021.
However, Business Post observed that despite the 55.6 per cent increase in the gross earnings for the year, the gross profit only moved higher by 1.2 per cent to N108.1 billion from N106.8 billion.
This was largely due to the higher cost of sales as it finished the year at N1.1 trillion compared with the N664.9 billion in the previous year.
A chunk of this was the higher cost of raw and packing materials (N958.0 billion versus N583.6 billion in 2021), an increase in fuel and oil to N23.1 billion from N17.8 billion, a jump in factory repairs and maintenance to N16.1 billion from N11.8 billion and an increase in other production expenses to N12.5 billion from N8.6 billion.
A further look into the financial statements showed that Flour Mills was able to cut down its selling and distribution expenses to N11.1 billion from N12.1 billion, but the administrative costs rose to N31.8 billion from N29.1 billion, leaving the company with an operating profit of N65.5 billion in contrast to N52.2 billion in the previous accounting year.
By Adedapo Adesanya
The National Pension Commission (PenCom) has defended its decision to allow Pension Fund Administrators (PFAs) to invest in the parent companies of their custodians, insisting that adequate safeguards are in place to protect contributors’ funds.
The director-general of the pension regulator, Ms Omolola Oloworaran, speaking on Tuesday during the Meet the Press Briefing at the Presidential Villa, Abuja, said the commission’s decision to relax the investment restriction followed a comprehensive risk assessment that found minimal conflict of interest.
She explained that under PenCom’s investment regulations, PFAs are only permitted to invest pension assets in carefully selected instruments that meet stringent criteria, including profitability, strong credit ratings and proven track records.
According to her, the commission regularly reviews its investment regulations, conducts routine examinations and spot checks on PFAs to ensure strict compliance with established risk management guidelines.
“PFAs cannot just go into the stock market and buy any kind of stock. There are strict guidelines. Companies must demonstrate profitability, have a proven track record and satisfy other criteria before pension funds can invest,” she said.
Ms Oloworaran noted that each PFA also operates under the oversight of a board, an investment committee and a risk management committee, providing additional layers of governance to safeguard contributors’ funds.
She said PenCom recently issued a circular allowing PFAs to invest in the parent companies of their custodians after determining that the potential conflict of interest was negligible.
The PenCom boss explained that the parent companies involved are largely Tier-1 banks, including First Bank, United Bank for Africa (UBA) and Zenith Bank, which she described as A-rated institutions with strong financial foundations.
She said the policy was intended to widen investment opportunities for pension funds without compromising safety.
Using Stanbic IBTC as an example, Ms Oloworaran explained that if its custodian is Zenith Bank, the previous restriction prevented the pension administrator from investing in Zenith Bank shares despite the bank’s strong performance.
“We reviewed the risks and any potential conflict of interest and found the risks to be very low. That is why we opened that investment window,” she said.
By Aduragbemi Omiyale
Analysts at Meristem Research have predicted that the inflation rate for June 2026 in Nigeria should marginally rise to 15.95 per cent on a year-on-year basis from the 15.93 per cent reported in May 2026.
The National Bureau of Statistics (NBS) is expected to release inflation numbers for last month later today, Wednesday, July 15, 2026.
In its report sighted by Business Post, Meristem Research said it expects inflationary pressures to re-emerge across key economies in the near term, as the re-escalation of the US-Iran conflict has reignited upward pressure on global oil prices.
It disclosed that this marks a sharp reversal from most of June, when the ceasefire between the two countries helped drive oil prices lower, raising expectations of some relief on the inflation front.
With conflicts now flaring up again, oil prices are likely to increase again, and the anticipated easing in energy-driven inflation may not materialise as broadly as earlier envisaged.
“Nonetheless, some relief is likely from the food segment, where robust supply conditions across major producing regions and softening demand should continue to ease food price pressures,” it stated.
The team also explained that it projected a 15.95 per cent inflation rate because of the lingering effects of persistent food price pressures.
“However, we expect core inflation to moderate as the sharp reversal in energy prices begins to filter through to transportation, distribution, and other energy-related costs, easing underlying price pressures.
“On a month-on-month basis, the combined effect of lower petrol prices, a relatively stable Naira, and the gradual pass-through of reduced energy costs across the supply chain should exert further downward pressure on inflation.
“Based on our assessment, food inflation is expected to remain the key swing factor, as seasonal pre-harvest supply constraints are likely to offset some of the gains from lower logistics costs,” it said.
By Adedapo Adesanya
The duo of Central Securities Clearing System (CSCS) Plc and Afriland Properties Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.61 per cent on Tuesday, July 14.
CSCS Plc saw its stock value drop N9.08 to close at N82.40 per share compared with the preceding session’s N91.48 per share, and Afriland Properties Plc slid by 17 Kobo to sell at N15.00 per unit versus N15.70 per unit.
The losses recorded by the two securities pulled back the market capitalisation by N41.64 billion to N2.546 trillion from N2.587 trillion, and cracked the NASD Security Index (NSI) by 69.36 points to 4,242.31 points from 4,311.67 points.
It was observed that the exchange witnessed two price advancers during the session, led by FrieslandCampina Wamco Nigeria Plc, which gained N1.37 to end at N151.37 per share compared with the previous day’s N150.00 per share, and Food Concepts Plc chalked up 5 Kobo to settle at N2.50 per unit versus N2.45 per unit.
The volume of securities traded by market participants surged by 50.7 per cent to 13.7 million units from the previous 9.1 million units, while the value of securities went down by 79.7 per cent to N65.2 million from N320.4 million, and the number of deals crashed by 3.6 per cent to 27 deals from the previous session’s 28 deals.
At the close of transactions, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with the sale of 3.4 billion units for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc, which exchanged 2.3 billion units valued at N6.5 billion, and CSCS Plc with 73.9 million units transacted for N5.2 billion.
GNI Plc also closed the trading day as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
