• Login
  • Register
Nairametrics
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
    • Economy
    • Nairalytics
  • Markets
    • Currencies
    • Cryptos
    • Commodities
    • Equities
      • Company Results
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Sectors
    • Agriculture
    • Aviation
    • Company News
    • Consumer Goods
    • Corporate Updates
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Health
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Renewables & Sustainability
    • Tech News
  • Business News
    • Budget
    • Public Debt
    • Funds Management
    • Tax
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
    • Research Analysis
  • Recapitalization
    • Access Holdings Offer
    • Fidelity Bank Offer
    • GTCO Offer
    • Zenith Bank Offer
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
    • Economy
    • Nairalytics
  • Markets
    • Currencies
    • Cryptos
    • Commodities
    • Equities
      • Company Results
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Sectors
    • Agriculture
    • Aviation
    • Company News
    • Consumer Goods
    • Corporate Updates
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Health
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Renewables & Sustainability
    • Tech News
  • Business News
    • Budget
    • Public Debt
    • Funds Management
    • Tax
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
    • Research Analysis
  • Recapitalization
    • Access Holdings Offer
    • Fidelity Bank Offer
    • GTCO Offer
    • Zenith Bank Offer
Nairametrics
No Result
View All Result
Home Opinions Blurb

Dangote Flourmills 2014 9 months Results Review by ARM Research

Nairametrics by Nairametrics
August 27, 2014
in Blurb
Share on FacebookShare on TwitterShare on Linkedin

Dangote Flour Mills Plc. (9 months ended June 2014)

  • Dangote Flour Mills Plc “DFM” reported a 3.7% YoY contraction in revenues to N28.7billion for 9 months ended June 2014. In addition, DFM recorded 4.5% and 3.6% YoY moderation in H1 14 pre-tax loss and after-tax loss to N6.2billion and N4.4billion respectively.

 

            Revenue declines on the back of softer prices…

RelatedStories

company-news

Corporate News roundup for the week ended October 28, 2017

October 30, 2017
Dangote Flour Reports N10.6 billion Profit (2016 FY)

ALERT: Dangote Flour reports N5 billion profit (2017 6 Months)

July 27, 2017
  • After experiencing positive growth in FQ2 14, which DFM linked to volume growth in its flour business following price cuts, FQ3 14 revenues resumed the negative trend observed in top-line since 2011 (ex FQ2 2014), declining 5.3% YoY to N10.1billion. DFM’s parent, Tiger Brands, alludes to elevated price competition on account of the excess milling capacity in the Nigerian flour industry. This suggests volume growth over FQ3 14 was unable to offset the impact of the price cuts driving the subdued pattern in revenues. In addition, we note that DFM announced its intention to close down two northern mills over the quarter which likely resulted in some volume softness.

 

      Moderation in wheat prices underpins gross margin expansion

  • FQ3 14 COGS fell at a faster pace than revenues (-13.5% YoY to N9.1billion)) resulting in a seven fold YoY expansion in gross profits to N997million. This partly reflects softer wheat prices (-3% YoY) and resulted in gross margins expanding 8.5pps YoY to 9.8%.

           

            Higher opex charges on restructuring extends trend of losses

  • FQ3 14 operating expenses surged 110% YoY (+182% QoQ) to N1.9billion which translates to a 10pps YoY expansion in opex-to-sales to 18.7%. We believe this likely reflects charges linked to mothballing of two northern mills. Thus, though DFM recorded N10.8million other operating income (FQ3 13: Nil), DFM reported an operating loss (N894 million) for the eight consecutive quarter.

 

  • Whilst net finance expenses declined 7.5% YoY to N643million on account of a 4.2% YoY contraction in borrowings to N31billion, DFM reported a 33% and 89% YoY moderation in LBT and LAT to N1.5billion and N182million largely on account of the surge in OPEX.

 

      Earnings weakness to persist on rising wheat prices

  • Current revenue reading reflects concerns about how excess slack in the milling industry amid tempered consumption growth combines with DFM’s limited product offering to leave it adversely positioned in the face of stringent price competition. Whilst the shutdown of certain milling facilities in the north helps reduce its operating leverage, volumes are likely to come in weaker over FQ4 14 driving scope for tame FY 14 readings. An already weak earnings outlook is compounded by the possibility of higher wheat prices based on USDA projections of softer harvests due to adverse US weather conditions. In response to the continued struggles, DFM announced the appointment of a new chief executive (effective July 1st 2014) suggesting Tiger Brands impatience with continued delays in unlocking value at its Nigerian subsidiary.

Note: This article is initial review and was culled from ARM Research Newsletter

 

 

 

  • Overall, current results and the decision to close down two more mills continue to show a company undergoing a sizable restructuring program with details which weigh heavily on our outlook for DFM. DFM trades at a current P/B of 3.3x vs. a mean of 2.6x for Bloomberg regional peers.  Consequently, our ratings for DFM remains suspended pending the opportunity to discuss issues with the new management.

 

 

 

 

Tags: Dangote Flourmills
Nairametrics

Nairametrics

Nairametrics is Nigeria's top business news and financial analysis website. We focus on providing resources that help small businesses and retail investors make better investing decisions. Nairametrics is updated daily by a team of professionals. Post updated as "Nairametrics" are published by our Editorial Board.

Related Posts

company-news
Company News

Corporate News roundup for the week ended October 28, 2017

October 30, 2017
Dangote Flour Reports N10.6 billion Profit (2016 FY)
Corporate Press Releases

ALERT: Dangote Flour reports N5 billion profit (2017 6 Months)

July 27, 2017
Tiger Brands gives up on Nigeria, to focus on serving middle income South Africans
Company News

Tiger Brands gives up on Nigeria, to focus on serving middle income South Africans

May 25, 2017
Dangote Flour Reports N10.6 billion Profit (2016 FY)

Dangote Flour Mills Introduces a New Product – “Ecccellente”

April 26, 2017
Aliko Dangote
Blurb

Sale of Dangote Noodles: Will History Repeat Itself ?

April 19, 2017
Dangote Flour Reports N10.6 billion Profit (2016 FY)
Company News

2016: Dangote Flour Mills Returns to Profitability…Posts N12 bn Profit

April 13, 2017
Next Post

Elumelu as UBA chairman guarantees greater return on share price

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Emple
nlng
first bank
Zenth Bank








DUNS

Recent News

  • Lagos Assembly summons Uber, Bolt, Indrive, Rida, LagRide over labour rights violations 
  • Reddit launches AI advertising tools to help brands target users through conversations 
  • Abia State to launch 25-year Greater Aba master plan targeting infrastructure, economy, and flood control 

Follow us on social media:

Recent News

Lagos Assembly summons Uber, Bolt, Indrive, Rida, LagRide over labour rights violations 

Lagos Assembly summons Uber, Bolt, Indrive, Rida, LagRide over labour rights violations 

June 17, 2025
Reddit launches AI advertising tools to help brands target users through conversations 

Reddit launches AI advertising tools to help brands target users through conversations 

June 17, 2025
  • iOS App
  • Android App
  • Contact Us
  • Home
  • Markets
  • Sectors
  • Economy
  • Business News
  • Financial Literacy
  • Disclaimer
  • Ads Disclaimer
  • Copyright Infringement

© 2025 Nairametrics

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
Social Media Auto Publish Powered By : XYZScripts.com
No Result
View All Result
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
    • Economy
    • Nairalytics
  • Markets
    • Currencies
    • Cryptos
    • Commodities
    • Equities
      • Company Results
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Sectors
    • Agriculture
    • Aviation
    • Company News
    • Consumer Goods
    • Corporate Updates
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Health
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Renewables & Sustainability
    • Tech News
  • Business News
    • Budget
    • Public Debt
    • Funds Management
    • Tax
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
    • Research Analysis
  • Recapitalization
    • Access Holdings Offer
    • Fidelity Bank Offer
    • GTCO Offer
    • Zenith Bank Offer
  • Login
  • Sign Up

© 2025 Nairametrics