…Gains 22.7% profit growth in 2023, despite N81.9 billion FX loss
BUA Foods, the consumer goods firm with the highest market capitalization in Nigeria, announced a profit after tax of N112.1 billion, a 22.7% rise over the N91.3 billion reported in 2022.
The group reported sales of N729.4 billion in 2023, up 74.4% from N418.3 billion in 2022, according to its audited financial statement.
Despite a massive foreign exchange loss of N81.9 billion incurred in 2023 as a result of the Naira’s depreciation, the business managed to produce an exceptional financial performance.
This is attributable to a significant increase in revenue across various product lines, including bakery flour, fortified sugar, and bran, as well as the introduction of BUA Rice to the market.
Also, the group recorded a pre-tax profit of N108.1 billion, however, with a deferred tax credit of N4.0 billion, the group’s profit after tax hit N112.1 billion.
The Key Highlights (FY 2023 vs FY 2022)
Revenue: N729.44 billion, +74.4% YoY
Cost of sales: N468.98 billion, +64.2% YoY
Gross profit: N260.46 billion, +96.1% YoY
Selling and distribution expenses: N29.85 billion, +110.4% YoY
Operating profit: N206.32 billion, +75.6% YoY
Net finance costs: N98.18 billion, +1030.9% YoY
Profit before income tax: N108.12 billion, +0.8% YoY
Profit after tax: N112.10 billion, +22.7% YoY
Earnings per share: N6.23, +22.9% YoY
Total assets: N1.07 trillion, +76.3% YoY
What you should know
Fortified sugar emerged as the primary revenue driver for the group, with BUA Foods registering N339.7 billion in sales from fortified sugar, marking a remarkable 162.8% increase from the N129.2 billion reported in 2022.
There was a remarkable surge in revenue made from the sale of bakery flour, as the group made N200.2 billion from bakery flour, marking a 151% growth from the N79.7 billion reported in 2022. BUA Foods also recorded N2.1 billion in revenue from its rice business. Then, 95.5% of the group’s revenue came from sales in Nigeria, a notable increase from the 86% reported in 2022.
The significant 64% rise in the cost of sales was primarily driven by a substantial 72% rise in the cost of raw materials consumed, with the group spending about N447.6 billion on raw materials in 2023, compared to the N260.2 billion posted in 2022.
The increase in interest rates throughout 2023 resulted in a significant 157.6% surge in the group’s interest expenses, with an interest expense of N18.6 billion recorded, marking a substantial rise from the N7.2 billion reported in 2022
