Unilever Nigeria reports highest profit in four years


By Philemon Adedeji

Despite challenging macroeconomic conditions, Unilever Nigeria Plc, a publicly listed company with trading and manufacturing interest in the consumer goods market has recorded highest profit in four years in its unaudited financial results ended December 31, 2022.

The Consumer goods maker reported a huge Profit After Tax (PAT) of N5.993 billion in full year 2022, reflecting a 75.7 per cent growth from N3.409 billion reported in the corresponding year.

Absolutely, the growth in profit was mainly driven by double-digit inflation which rocked the Nigerian economy last year.

From the profit and loss figures, the group declared N9.86 billion gain before tax in 2022, representing an increase of 378.6 per cent from N2.06 billion before tax in 2021, which can be attributed to increase in Cost of sales, total operating expenses and finance cost.

The group unaudited results showed revenue of N70.52 billion recorded in 2021 to N88.72 billion recorded in the comparable period of 2022, Unilever Nigeria Plc has recorded 26 per cent growth in revenue during the 12 months ended December 31, 2022.

The total revenue of N88.72 billion was driven mainly by the home and personal care segment which contributed N46.1 billion while N42.6 billion was obtained from its food products segment in the full year of 2022.

Similarly, the home and personal care segment contributed the most of N39.52 billion while N31 billion was obtained from food products to the total revenue of N70.52 billion in the full year of 2021.

Unilever’s cost of sales rose significantly to N57.24 billion, grew by 14.1 percent from N50.16 billion in the comparable periods.

The interplay between revenue and Cost of sales (CoS) lifted gross profit to N31.48 billion in 2022, an increase of 54.6 per cent from N20.36 billion in 2021.The growth in revenue and gross profit contributed to 35 per cent gross margin in 2022 from 28.9 per cent in 2021.

Operating profit grew to N8.57 billion, a massive 658 per cent increase from N1.13 billion in the reviewed period.

Unilever’s selling and distribution expenses increased by 44.5 per cent to N4.8 billion from N3.32 billion in the comparable periods.

Marketing and administrative expenses climbed 21 per cent to N18.3 billion in the full year of 2022 from N15.12 billion in the full year of 2021.

Property, plant, and equipment dipped 4.3 per cent to N21.4 billion from N22.37 billion in the period reviewed.

Unilever’s cash and bank balances stood at N68.17 billion in the full year of 2022, a 22.4 per cent increase from N55.7 billion in the full year of 2021.

Total equity grew 5 percent to N69.2 billion in December 2022 from N65.76 billion in December 2021.

The firm’s net cash flow generated from operating activities dipped 38 percent to N12.46 billion from N20.1 billion in the comparable period.

Net cash flows used in investing activities stood at N734.5 million from a negative cash flow of N927.9 million in the reviewed period.

Net cash used in financing activities stood at N714 million from N363.07 billion negative cash flow year on year.

The firm’s cash and cash equivalents at the end of the period rose to N68.17 billion, up 22.4 percent from N55.7 billion in the period reviewed.

Unilever’s basic and diluted earnings per share attributable to equity holders increased to N1.04 in the full year of 2022 from N0.59 in the same period of 2021.

The growth in earnings was due to the expansion in gross margin (+105.5 per cent y/y) following a 30.5 per cent year-on-year decline in cost of sales.


Gross margin came in at 35.5 per cent in 2022 from 28.9 per cent in 2021, as operating expenses margin stood at 26.0 per cent in 2022 from 26.1 per cent in 2021, While Earnings Before Tax Income Tax Margin gained 9.7 per cent in 2022 from 1.6 per cent in 2021.

In addition, Earnings Before Income Tax Depreciation and Ammortisation (EBITDA) margin was at 12.4 per cent 2022 from 7.2 per cent in 2021, as Profit Before Tax Margin stood at 11.1 per cent in 2022 from 2.9 per cent in 2021, while Profit After Tax margin gained 6.8 per cent in 2022 from 1.0 per cent in 2021.

Cost of sales (Cos) margin declined to 64.0 per cent in 2022 from 71.1 per cent in 2021.

The Vice President of Highcap Securities Limited, David Andori commented on the results that, the result is very impressive. It indicates that Unilever is becoming very profitable again. Good dividend payment is expected from this performance.

Analysts at Cordoros research commented that UNILEVER’s Q4-22 performance came in as expected, given the year-end festivities. “However, we did not envisage the sizeable decline in the cost of sales witnessed in the quarter, which significantly improved the company’s margins and profitability.

“Also, we view as impressive UNILEVER’s ability to eke out growth in the HPC segment, amid the increased competition in the space, following the influx of cheaper unlisted brands. For 2023FY, we expect sub-inflationary price increases to support UNILEVER’s topline, with most of the growth coming from the company’s Food Products segment. However, we believe the stiff competition in the HPC segment and cost pressures will inhibit UNILEVER’s profitability during the year. Our estimates are under review.”


The Chief Executive Officer (CEO), Alan Hope commented that company delivered “Strong top-line growth” despite challenging macroeconomic conditions.

“We have made further progress in the transformation of Unilever and continues to deliver against our strategic priorities,” Jope said.

“Our new operating model is already unlocking a culture of bolder and more rapid decision making with improved accountability.

“We are increasingly realising the benefits from the reshaped portfolio, accelerated savings delivery and improve execution.”

Speaking to the analysis improved earnings call, he added: “It’s still early days for the new model and we are cautious to avoid declaring victory too early in what is a very substantial change for the company.

“But I must say, the first six months have gone very well. We’re already seeing benefits in the speed that decisions are being made.”

The CEO said each of the five business units was now “capable of growing faster than Unilever’s historical growth rate,” with differential approaches based on geographical footprints consumer targets and operating channel

“Our primary focus is on organic growth and acquisitions will be focused and discipline mainly though not exclusively in beauty and well being,” he said.

“Disposals to ‘prune the portfolio’ would also continue where needed across all units,” he said.