BUA Foods' Profit Grows to N450 Billion in Nine Months

BUA Foods, a top producer of sugar, pasta, and edible oils, reported an 11.2 percent rise in net profit for the first nine months of the year. This information came out in its unaudited financial report released on Friday.

The company made N1.1 trillion in turnover, a drop from N1.4 trillion last year. This decline followed weaker sales in its bakery flour and fortified sugar sectors.

Despite this, BUA Foods cut its spending on raw materials by 37.2 percent. This move helped reduce the cost of sales and pushed gross profit up by N32.2 billion to N552.9 billion.

The company's success also came from other cost-control efforts. Administrative expenses fell by more than a quarter to N22 billion. Selling and distribution costs also dropped by 15.4 percent to N45 billion, which eased pressure on operating profit.

BUA Foods is mostly owned by billionaire Abdulsamad Rabiu, and it has a market value of N13.7 trillion. In December 2021, the company combined its sugar, rice, oil, flour, and pasta divisions into one entity. This move aimed to gain benefits from economies of scale in its food processing business.

During the reviewed period, the EBITDA margin rose to 43.6 percent from 31.3 percent. Profit before tax increased by 11.1 percent to N480.5 billion. Profit after tax also climbed to N450.5 billion from N405.3 billion.

“Despite a 19 percent drop in revenue to ₦1.15 trillion, due to lower prices and weak consumer demand, we achieved a significant improvement in profitability through good cost management, better productivity, and strong execution across the business,” said CEO Ayodele Abioye in a release about the earnings.

“Looking ahead, we will focus on profitable growth, improving market reach, and keeping our operations efficient,” he added.