Cadbury, Nestlé and Unilever, three listed consumer goods companies on the NGX Mainboard, have released their Q1 2026 results, showing how rising costs continue to shape their profitability and margins.
Unilever is showing stronger margin quality; Nestlé remains profitable but is still managing cost and leverage pressure, while Cadbury’s earnings show clear margin strain.
This matters for investors because all three stocks have been bullish on the NGX since 2025.
- As of May 22, 2026, Cadbury has gained 15.2% year-to-date, rising from N59.90 at the start of the year to N69, after delivering a 179% return in 2025.
- Unilever has gained 133% so far in 2026, moving from N72 to N168, following a 124% gain in 2025.
- Nestlé has also advanced 59.6% year-to-date, rising from N1,958 to N3,125, after returning 119% in 2025.
Despite these gains, the stocks do not yet appear overstretched based on their 14-day Relative Strength Index readings.
- Nestlé’s RSI stood at 32.43, Cadbury’s at 51.18, while Unilever’s was higher at 66.02.
With Nestlé valued at about N2.48 trillion, Unilever at N965 billion and Cadbury at N157 billion, the Q1 2026 margin performance becomes important in assessing whether the rally is being supported by stronger earnings quality or mainly by market optimism.
Meanwhile, margin performance helps investors see whether profit growth is coming from stronger operations and better cost control, or from finance cost relief, pricing adjustments and other one-off gains.
That said, let us look at how the companies are coping with rising costs and how it has impacted profit and margins.
- At the combined level, the three companies grew revenue by 12.15% year-on-year to N425.13 billion, while gross profit rose by 12.50% to N169.56 billion.
- This helped their combined gross profit margin remain broadly stable at 39.88%, compared with 39.76% in Q1 2025.
However, the pressure became clearer at the operating level.
- Combined operating profit slipped slightly by 0.51% to N91.64 billion, despite higher revenue, as selling, distribution, marketing and administrative expenses rose faster than sales.
- As a result, their combined operating profit margin declined to 21.55% from 24.30%.
Below the operating line, the picture improved. Combined pre-tax profit rose by 31.14% to N92.39 billion, lifting the pre-tax profit margin to 21.73% from 18.58%, largely supported by lower net finance costs, especially at Nestlé and Cadbury.
Combined post-tax profit also increased by 19.05% to N49.66 billion, with post-tax margin improving slightly to 11.68% from 11.00%.
- Despite the increase, this still means the three companies retained less than N12 as profit from every N100 of revenue.
Cadbury:
Cadbury had the weakest margin performance among the three companies in Q1 2026, despite its strong long-term revenue growth.
The company’s revenue grew from N42.37 billion in 2021 to N168.66 billion in 2025, almost a fourfold increase in five years.
- EPS returned to N3.93 in 2025 after losses in 2023 and 2024, while the company last paid dividend in 2022.
However, Q1 2026 showed that revenue growth alone is not enough. Revenue rose by 7.00% to N39.83 billion, but cost of sales grew faster by 15.43% to N28.94 billion.
This pulled gross profit down by 10.39% to N10.89 billion, while gross margin fell to 27.34% from 32.65%.
The pressure was worse at the operating level as operating expenses rose to N5.88 billion from N2.86 billion, pushing operating expenses-to-revenue to 14.77% from 7.68%.
- As a result, operating profit fell by 51.27% to N4.72 billion, while operating margin dropped to 11.85% from 26.02%.
Its finance line helped cushion the decline, supported by an unrealized foreign exchange gain of N870.60 million, compared with N75.89 million in Q1 2025, and a significant drop in interest expense on borrowings to N370.63 million from N1.12 billion.
- As a result, the company moved from a net finance cost of N1.14 billion in Q1 2025 to net finance income of N477.92 million in Q1 2026.
However, this was not enough to offset the pressure from higher cost of sales and operating expenses as overall profit dropped by 39% to N3.64 billion pushing the net profit margin down by 43% to 9%.
- Despite the weaker Q1 margin performance, Cadbury can still beat its 2025 full-year profit if it sustains its current quarterly earnings run rate
Cadbury’s Q1 2026 profit of N3.64 billion already accounts for about 40.6% of its 2025 full-year profit of N8.97 billion.
Nestlé Nigeria Plc
Nestlé remains the largest and most profitable of the three companies, with its long-term revenue trend showing a strong scale.
- Revenue grew from N351.82 billion in 2021 to N1.21 trillion in 2025, more than tripled over five years.
- The earnings trend, however, has been uneven. EPS rose from N50.51 in 2021 to N61.77 in 2022, before falling into losses of N100.26 in 2023 and N207.65 in 2024.
- The company returned to positive EPS of N132.42 in 2025, showing a strong recovery from the loss-making years.
In Q1 2026, revenue rose by 10.59% to N326.13 billion, while cost of sales increased by 10.79% to N194.07 billion.
- Gross profit rose by 10.30% to N132.06 billion, but gross margin was almost flat at 40.49%, compared with 40.60% in Q1 2025.
The pressure was more visible at the operating level as operating expenses rose to N56.84 billion from N45.86 billion. As a result, operating margin declined to 23.13% from 25.14%.
Nestlé’s profit after tax rose by 29.23% to N39.00 billion, helped by a sharp reduction in net finance costs.
Nestlé last paid dividends in 2021 and 2022, at N50.50 and N61.50 respectively. The key question is whether the company can sustain profit recovery, reduce leverage, and restore dividend consistency.
Unilever Nigeria Plc
Unilever has the strongest long-term earnings and dividend story among the three companies.
- Revenue grew from N70.52 billion in 2021 to N214.67 billion in 2025.
- Profit after tax also rose strongly from N3.41 billion in 2021 to N32.20 billion in 2025.
- Its earnings per share also improved from N0.12 in 2021 to N5.60 in 2025.
- Dividend per share rose from 50 kobo in 2021 to N3.75 in 2025.
This gives Unilever a stronger shareholder return record than Cadbury and Nestlé, which have not paid dividends after 2022.
The Q1 2026 numbers also support this momentum. Revenue rose by 25.96% to N59.17 billion, while cost of sales increased at a slower pace of 15.77% to N32.56 billion.
- This lifted gross profit by 41.17% to N26.61 billion, with gross margin improving to 44.98% from 40.13%.
- Operating profit also rose by 38.88% to N11.48 billion, while operating margin improved to 19.41% from 17.60%.
This shows that Unilever’s profit growth was driven more by stronger operations and better cost control.
The company also has the healthiest balance sheet, with positive working capital of N93.36 billion, a current ratio of 2.34x, and very low debt-to-equity of 0.02x.
Overall, Unilever’s rally is backed by improving margins, stronger profitability, dividend growth, and low leverage.
- Nestlé remains the biggest profit generator, but leverage and weak working capital remain key risks.
- Cadbury has a strong revenue growth story and could still beat its 2025 profit, but margin pressure and weak liquidity remain key risks. Investors will want to see stronger cost control, improved liquidity, etc in the coming quarters.
