Flour Mills of Nigeria Plc has posted a N28 billion profit for the year ended 31st of March 2022. This is following a consequent rise in the revenue of the company by 51% from N772 billion to N1.16 trillion.
The result was amid an inflationary year which saw the price of goods and services increase significantly. In addition to the increasing prices, the Russia-Ukraine war set off a chain reaction in the global economy causing a spike in important commodities such as wheat. In spite of these, the company witnessed an increase in revenue, underlying the importance of food as a necessity.
The report shows that the cost of sales increased with the revenue during the period by 59% to hit N1.1 trillion from N665 billion resulting in a gross profit of N108 billion; closing in on N106 billion in the previous year.
While the company saw a net operating loss of N135 million during the period, the amount is quite mild compared to the N15 billion loss for the same purpose in the previous year. Also, selling and distribution expenses, as well as administrative expenses, amounted to N11 billion and N31 billion from a respective N12 billion and N29 billion. These influenced the operating profit to record N66 billion in 2022 compared to the N52 billion in 2021.
Investment income – basically from short term investments and bank deposits – saw a drastic dip by 70% to post N1.1 billion in 2022; as of the year before, the amount realised for the same purpose was N3.6 billion. Finance costs, however, saw an increase to N25 billion from N18 billion as a result of the increase in interest on bonds and commercial paper, interest expenses on lease liabilities and interest on bank loans and overdrafts.
The profit before tax however stood at N41 billion in 2022 from N37 billion in 2021 while profit for the year was N28 billion in 2022 from N26 billion in 2021
What you should know
- The company last traded at N35.7 as of 30th May 2022 and its market capitalization stood at N147 billion.
- Earnings per share is valued at N626.
- Total assets hit N667 billion in 2022 from N544 billion in 2021.
- Flour Mills of Nigeria (FMN) recently announced that it has obtained all the necessary regulatory approvals to acquire a 71.69% stake in Honeywell Flour Mills (HFMP) and another 5.06% stake in HFMP held by First Bank.
- According to the company, the acquisition has been approved by all relevant regulators, namely the Federal Competition and Consumer Protection Commission (FCCPC), Nigerian Exchange Limited (NGX), and the Securities and Exchange Commission of Nigeria (SEC).
