BUA Foods Plc bolstered its profit performance in the first quarter of 2023 despite uncertainties in the economy. The food producer reported more than 77% post-tax profit in the period compared with the amount delivered in the comparable period in 2022.
Though 2023 started on a negative note with myriads of macroeconomic uncertainties spooked by the scarcity of naira, the company lived above margin dilutive challenges.
Details from BUA Foods Plc’s unaudited first quarter financial statement show an outstanding growth in revenue.
The company reported its sales grew from N90.07 billion in the first quarter of 2022 to N144.32 billion at the end of Q1 2023.
The strong topline growth resulted in a significant increase in gross profit from N28.33 billion to N56.66 billion, up by 99.99%. This trickles down to the bottom line, spurring double digits earnings per share growth.
A deep dive into the numbers show the growth in revenue was majorly spurred by the rise from the sales of fortified sugar (95.72%), bakery flour (61.74%), non-fortified sugar (38.61%), Pasta (21.89%), and the revenue of N384 million realized from the sales of head rice which was not recorded in the preceding year of the same period.
In the period, BUA Foods recorded a 41.99% increase in the cost of sales majorly spurred by the increase recorded in the cost of raw materials and energy among others.
Its raw material costs inched upward by 46.52%, energy costs increased by 40.51% and depreciation printed 56.90% above the comparable period.
The company’s administrative expenses and selling & distribution expenses rose by 72.40% and 787.31% respectively. However, management significantly reduced BUA Foods’ finance cost amidst a high interest rate environment.
Detail from its financial statement shows that the company’s net finance cost improved by 76.35%. The impressive performance recorded across all segments resulted in an 84.97% growth in profit before tax.
However, the tempo of its impressive outing was reduced by a significant increase in tax payments. According to its financial highlights, BUA Foods’ income tax rose by 174.57% in the first quarter of the year.
In spite of this, the food producer reported that its profit after tax grew significantly by 77.15%, from N22.85 billion to N40.47 billion.
Similarly, basic earnings per share (in Kobo) grew by 77.17%. BUA Foods also maintained a strong balance sheet as total assets and total shareholder’s equity grew by 6.98% and 17.52% respectively.