Flour Mills of Nigeria Plc, one of the integrated food business and agro-allied group, has posted 17 per cent growth in profit after tax for the first quarter ended June 30, 2019.
The group’s profit after tax stood at N4.2 billion, compared to N3.6 billion reported in 2018 Q1, accounting for 17 per cent- YoY growth.
According to its unaudited first quarter results for 2019, the group’s profit before tax was N5.5 billion, compared to N5.2 billion in 2018 Q1, representing 6 per cent YoY growth.
The company’s finance cost reduced to N4.5 billion, compared to N6.2 billion in 2018 Q1 (YoY).
According to the management, the group’s deleveraging strategy achieves desired results as finance cost drops by 27 per cent. Groups earnings stood at N134 billion, compared to N133 billion in 2018 Q1, representing a marginal 1 per cent YoY growth.
Commenting on the result, the Group Managing Director, Paul Gbededo, said:
“The results for the first quarter revealed a strong performance as the group continues to make significant gains with its strategy to improve operational efficiency and implementing cost control measures across its operations.
Deleveraging and active balance sheet management strategy achieved significant reductions in finance costs which dropped by 27 per cent.
“Revenue, for the most part, remained stable, even in the light of strong economic headwinds and depressed consumer demand. Sales volumes appreciated by seven per cent while gross margins remained largely in line with figures from the previous year at 12.2 per cent.
“The turnaround in the agro-allied division remained on track with profit before tax at break-even. This was largely due to significant improvement in Premier Feeds and robust growths recorded in Golden Fertilizer. After the recently concluded restructuring and optimisation of the agro-allied division, the businesses are now properly positioned to pursue value accretive opportunities which we envisage will continue to yield positive results in the year.
“The first quarter result is a good start to the year and a great reflection of the direction that the business is headed as we continue to push our strategy of operational efficiency and sustainable growth. We envisage even more organic growth across the food segments, with anticipated moderations in cost of sales, as global wheat prices reduce and our improved investments in aligning marketing, sales and distribution activities boost earnings and increase market gains.”