Cardbury Nigeria Kayode Tokede
With hike in cost of sales and severe competition in the consumer goods sector, Cadbury Nigeria Plc’s profit and dividend payout to shareholders seems threatened in 2021 financial year result and accounts.
The company in its nine months ended September 30, 2021 unaudited result and accounts was unable to managed its rising cost of sales, which was the main challenge that caused a net loss of N516 million in the half year ended June 30, 2021
The multinational company had reported cost of sales of about 30 per cent to N16.3billion in H1 2021 from N12.61billion reported in H1 2020.
Cost of sales in nine months ended September 30, 2021 grew by 19.04 per cent to N24.4billion from N20.52billion in nine months of 2020, to drive proportion of cost of sales/revenue to 81.28 per cent in nine months of 2021 from 79.53 per cent in nine months of 2020.
The company in the nine months under review reported 16.5 per cent increase in revenue to N30.05billion from N25.8billion reported in prior nine months of 2020.
Revenue generated in Nigeria rose by 25.04 per cent to N28.7billion from N22.96billion in nine months of 2020,while export sales dropped by 52.9 per cent to N1.33billion from N2.83billion reported in nine months of 2020.
Analysts explained that further rise in cost of sales and hike in finance cost in fourth quarter of 2021 might weaken the company’s profit in full year ended December 31, 2021 results.
Companies operating in Nigeria had faced hike in cost of sales in the four quarter of 2021 amid growing revenue, mixed financial parameters that stand to play critical role in profit.
However, decline in total operating expenses and growth in net finance income boost profits in the nine months under review.
Cadbury Nigeria’s total operating expenses dropped by 10 per cent to N3.82billion in nine months of 2021 from N4.24billion reported in nine months of 2020.
The breakdown revealed that selling and disturbing expense gained 2.5 per cent to N3.38billion in nine months of 2021 from N3.3billion in nine months of 2020, while administrative expenses dropped by 53.3 per cent to N436million from N935.99million prior nine months of 2020.
Net finance cost dropped by 290 per cent to N333.25million from N85.45million reported in nine months of 2020.
The company’s profit of N241 million in the first quarter was absorbed by a loss of N861 million in the second quarter, closing […]
