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BUA Foods: Soar in raw materials weaken profit

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By Philemon Adedeji

Due to increase in cost of raw materials to N101.4 billion in half year H1 2022 from N84.2 billion reported in half year H1 2021, cost of sales during the period of study grew by 16.11 per cent to N116.8 billion in H1 2022 from N100.6 billion achieved in H1 2021.

However, the food processing company reported 10.8 per cent increase in Profit Before Tax (PBT), to N42.7 billion in H1 2022 from N38.6 billion accounted for the first six months of June ended 30,  2022.

The group unaudited results showed Profit After Tax (PAT), grew significantly by 13.7 per cent to N39.3 billion in H1 2022 from N34.6 billion achieved in H1 2021.

The increase in cost of sales causing gross profit to rose slightly by 1.8 per cent from N51.1 billion as of end of June 30, 2021 to N52.1 billion achieved as of end of June 30, 2022.

From the profit and loss figure, the group net revenue moved from N151.7 billion as of end of June 30, 2021 to N168.9 billion as of end of June 30, 2022, an increase of 11.3 per cent.

In addition, The group grew its Earnings Per Share (EPS), by 13.5 per cent to N2.18 in H1 2022 from N1.92 achieved as of June 30, 2021.

The break down of BUA foods revenue showed 55.7 per cent increase in sales of non-fortified (Sugar) to N53.9 billion in H1 2022 from N34.6 billion achieved in H1 2021, while revenue generated from the sales of fortified (Sugar) declined by 10.1 per cent to N54.8 billion in H1 2022 from N60.9 billion in H1 2021.

The revenue generated from the sales of bakery flour rose by 14.4 per cent to N31.4 billion in H1 2022 from N27.5 billion in H1 2021.

Again, revenue reported in the sales of molasses gained a 102.2 per cent to N387.9 million in H1 2022 from N191.8 million in H1 2021, as revenue generated from the sales of pasta moved from N25.8 billion in H1 2021 to N28.9 billion in H1 2022, an improvement of 11.9 per cent.

In addition,the food processing company reported total assets which gained a 8.7 per cent to N645.4 billion in H1 2022 from N593.5 billion in H1 2021.

As current assets gained a 19.2 per cent to N322.1 billion in H1 2022 from N270.2 billion in H1 2021, but non-current assets declined by 0.1 per cent to N323.2 billion in H1 2022 from N323.3 billion in H1 2021.

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capital market

NGX: Sell-offs in banking stocks drop value of transactions down 2.60%

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Bearish sentiment persisted on banking stocks at the equity market on Friday, making the value of transactions traded on the floor of the Nigerian Exchange Ltd.(NGX) down by 2.60 per cent.

Analysis of the market activities indicated trade turnover settled lower relative to the previous session.
Specifically, investors transacted a total of 257.86 million shares valued at N5.40 billion exchanged in 7,168 deals, as against 285.91 million shares worth N5.54 billion exchange in 7,726 deals posted on Thursday.
Consequently, the market capitalisation, which opened at N56.469 trillion, shed N173 billion or 0.31 per cent to close at N56.296 trillion.
The All-Share Index also dropped 0.31 per cent or 306 points to settle at 99,539.75, compared to 99,845.91 recorded in the previous session.
As a result, the Year-To-Date (YTD) return dipped to 33.12 per cent.
Sell-offs in Guaranty Trust Holding Company (GTCO), FBN Holdings, Zenith Bank,  Access Corporation,  Stanbic IBTC Bank, Jaiz Bank, as well as United Capital and Unilever Nigeria, among other top decliners, drove the market to a negative terrain.
Meanwhile, market breadth closed negative with 20 losers and 14 gainers.
On the losers’ chart, United Bank led by 10 per cent to close at N1.62, FBN Holdings followed by 9.83 per cent to close at N24.30, Tantalizers declined by 8.57 per cent to close at 32k per share.
Deap Capital Management shed 7.35 per cent to close at 63k and Caverton went down by 6.83 per cent to close at 1.50 per share.
On the gainers’ chart, FTN Cocoa Processors led by 9.60 per cent to close at N1.37, RT Briscoe trailed by 9.26 per cent to close at 59k, Livestock Feed gained N1.45 per share.
Royal Exchange Assurance added 8.06 per cent to close at 67k, while Consolidated Hallmark Plc rose by 7.44 per cent to close at N1.30 per share.
On the activity chart, UBA led in volume with 38.72 million shares traded in value of N888.55 million, while GTCO led in value with 38.30 million shares worth N1.31 biliion.
Access Corporation also sold 34.34 million shares worth N584.54 million, Zenith Bank traded 24.41 million shares worth N875.85 million and The Initiative Plc transacted 17.52 million shares worth N34.13 million.
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Financial expert seeks alignment of FG’s fiscal policy with CBN’s monetary policy

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A financial expert, Mr Eddie Osarenkhoe, has advised the Federal Government to align its fiscal policy with the Central Bank of Nigeria’s monetary policy to achieve economic stability.

Osarenkhoe, the immediate past President of Finance Houses Association of Nigeria (FHAN), gave the advice while speaking with newsmen on Wednesday in Ota, Ogun.

He attributed the current steady appreciation of the naira to CBN’s reforms and the country’s ability to pay some of its debts.

Osarenkhoe applauded the CBN reforms which, he said, had helped to sustain the steady appreciation of the naira against the dollar.

The financial expert stated that CBN was able to check speculators in the foreign exchange, thus resulting in continuous appreciation of the nation’s currency.

“If the federal government is able to come up with fiscal policy in alignment with that of CBN, it will help the nation’s economy a great deal,” he said.

According to him, the economy needs to improve through exports to enable the country to earn more foreign exchange.

The naira has shown a remarkable strength against the US dollar, trading below N1,000 at the official market.

This development has been attributed to the strategic financial policies being implemented by the President Bola Tinubu-led administration and CBN.

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Investors lose N457bn as bearish sentiment continues

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Investors in the Nigerian equities market lost N457 billion at the end of trading on Wednesday.

This followed the dip in the share value of Livestock Feeds, Computer Warehouse Group, International Energy Insurance, and FTN Cocoa Processors on the trading floor today.

After five hours of trading at the capital market, the equity capitalisation crashed to N56.5 trillion from N56.9 trillion posted by the bourse on Tuesday.

Similarly, the All-Share Index (ASI) fell below the 100,000-mark to 99,908.89 from 100,717.21 achieved by the bourse the previous day.

The market breadth was negative as 17 stocks advanced, 26 declined, while 78 others remained unchanged in 9, 074 deals.

Ikeja Hotel topped the gainers’ list with +10.00 percent to close at N7.26 from its previous N6.60 per share.

Fidelity Bank, Academy, Morison, and Prestige also increased their share prices by 9.88 percent, 9.77 percent, 9.71 percent, and 9.26 percent respectively.

On the flip side, Livestock Feeds, Computer Warehouse Group, International Energy Insurance, and FTN Cocoa Processors led other price decliners as they shed 10.00 percent, 9.79 percent, 9.79 percent and 9.72  percent each off their share prices.

UBA recorded the highest volume by trading 55.013 million shares valued at N1.28 billion in 1,092 deals followed by Zenith Bank with 47.029 million shares worth N1.69 billion traded by investors in 907 deals.

Access Corp traded 44.986 million shares valued at N789 million in 845 deals.

On the value index, Zenith Bank recorded the highest value for the day trading stocks worth N1.69 billion in 907 deals followed by UBA which traded equities worth N1.284bn in 1,092 deals.

Access Corp traded stocks worth N789 million in 845 deals.

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