Flour Mills of Nigeria Plc Posts Impressive Q3-24 Results, Driven by Robust Revenue Growth and Strategic Innovations

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Flour Mills of Nigeria Plc (FLOURMILL) released its unaudited Q3-24 results on January 26, revealing a remarkable standalone earnings per share (EPS) of NGN2.65 (compared to Q3-23: NGN0.90), supported by a substantial 51.1% year-on-year (y/y) increase in revenue. Despite a challenging H1-24, the company’s 9M-24 EPS settled at NGN0.22 (compared to NGN2.87), highlighting a resilient performance.

The Q3-24 revenue growth of 51.1% (9M-24: +40.0% y/y) was driven by robust expansions across various business segments, including Food (+38.5% y/y), Agro-Allied (+43.1% y/y), Sugar (+115.5% y/y), and Support Services (+35.7% y/y). Key factors contributing to this broad-based topline growth include the introduction of value products like Golden Penny Choco, Golden Penny Jollof Hot Noodles, and Cinnamon flavored Chin Chin in the Food segment, a favorable price/volume mix, and increased investment in business-to-consumer (B2C) channels.

Quarter-on-quarter, revenue continued its upward trajectory, growing by 17.0%, with all business segments expanding – Food (+10.3% q/q), Agro-Allied (+45.2% q/q), Sugar (+24.2% q/q), and Support Services (+13.3% q/q).

The gross margin for Q3-24 expanded by 123 basis points y/y to 21.0%, mitigating the impact of higher cost of sales. However, EBITDA and EBIT margins experienced declines due to increased foreign exchange (FX) losses (+671.7% y/y) and higher operating expenses.

Net finance costs rose by 17.1% y/y, driven by increased loan facilities obtained during the review period, leading to a 38.5% year-to-date rise in total borrowings to NGN484.22 billion.

Despite these challenges, Q3-24 standalone Profit Before Tax (PBT) grew by 29.6% y/y to NGN8.52 billion. After a tax expense of NGN261.99 million, Profit After Tax (PAT) reached NGN8.26 billion, demonstrating solid financial performance.

Looking ahead, FLOURMILL remains optimistic about further topline expansion, fueled by increased production capacity from recent acquisitions, modest price increases, and an expanded distribution network. However, sustained higher FX losses may constrain net operating income. Analysts anticipate more clarity on the company’s outlook in the management call scheduled for January 29, 2024, at 1:00 pm Nigerian time.


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