NIGERIA – Nigeria’s beverage and confectionery manufacturer, Cadbury Nigeria Plc, has reported 32% growth in gross profits to US$6.68 million (N2.4bn) in the first quarter of 2019 driven by higher sales and lower finance charge.
During the period, the firm recorded a 2,200% jump in pre-tax profits while sales grew by 13% to US$25.62 million (N9.2bn) from US$22.83 million (N8.2bn) in the previous year reflecting a strong kick start as it continues to implement profitability measures.
Operating profit jumped 236% to US$1.99 million (N714m) from US$0.59 million (N213m) while its finance cost fell sharply by 87% thus providing a boost to net income which rose 2,200% to US$1.41 million (N507m).
The company operates three reportable business segments with its refreshment beverages segment, which includes the manufacture and sale of Bournvita and 3-in1 Hot chocolate, contributing 61% of net sales.
In addition, the firm’s Intermediate Cocoa products which include the manufacture and sale of cocoa powder, cocoa butter, cocoa liquor and cocoa cake, accounted for 10% of group sales in the period.
During the period, Cadbury posted 12.7% increase in revenues to US$2.58 million (N9.28bn) from US$22.95 million (N8.24bn) despite a weak economy and the inflationary environment in addition to significant reduction in managing costs.
The feat helped double operating profit margin, which is a measure of a manufacturing company’s operational efficiency, to 4.7 per cent, up from 2.2 per cent.
The performance reaffirms the company’s continued focus on growing its market share, expanding and improving its distribution network as its gears up to achieving sustainable growth and delivering better returns to shareholders.
In the past two years, Cadbury Nigeria has year on year posted improved strong performance as it continues to ramp up good profits with the results under review being an indication that the firm is headed for one its best years in a long while.
During its 2018 financial year, the Mondelez International subsidiary reported growth in net earnings by 174% to US$2.27 million supported by its flagship brands; Bournvita and 3-in-1 Hot Chocolate, which contributed 59% of the company’s sales.