Tiger Branded Company Limited formerly Dangote Flour Mills Nigeria Plc released its 2015 9 months results posting a loss after tax of N12.7 billion double the loss it declared same period 2014. Tiger Brand has now posted its third consecutive 9 months loss after tax.
The company in its audited results published in the website of the Nigerian Stock Exchange blamed Naira devaluation for contributing about N1.8 billion to its losses. The company also took an impairment charge of about N2.6 billion from properties, equipment and subsidiaries that are now worth less than their original value. A closer look at the results reveal the company lost about N14 billion in its Flour Business and another N1.9 billion and N1.3 billion in its Pasta and Noodles Business respectively. The company however recorded a year on year 17% rise in revenue. The company now has negative reserves of N23 billion and is technically insolvent going by its negative equity of N2.4 billion. It has a negative working capital of about N28.4 billion.
Tiger Brand acquired controlling shares in Dangote Flour Mills in 2012 for about $182 million before acquiring more shares to give it total control and taking its purchase consideration to about $200m. The company then announced that Aliko Dangote was resigning from the board of Dangote Flour Mills and also announced a name change to Tiger Branded Consumer Goods Ltd.
The company then issued another press release two weeks ago that Dangote Industries Ltd was going to buy back Dangote Flourmills (now Tiger Branded Consumer Goods) from South Africa’s Tiger Brands. The deal involves, Tiger Brand selling back a 65.7% stake in its loss making Nigerian division to Dangote Industries Limited for $1. Dangote Industries is expected to inject N10 billion into the company.