Flour Mills of Nigeria sees 49% revenue boost driven by strategic initiatives, market expansion

NIGERIA – Flour Mills of Nigeria Plc (FMN), the nation’s premier food and agro-allied company, has announced an impressive 49% increase in revenue for the fiscal year ending March 31, 2024.

The company’s revenue hit NGN2.3 trillion (US$1.54 billion) from NGN1.5 trillion (US$967M) in 2023.

The company attributes this exceptional growth to FMN’s adeptness in navigating the ever-changing economic landscape and its robust market position.

Founded in September 1960 and listed on the Nigerian Stock Exchange in 1978, Flour Mills of Nigeria Plc has grown into a cornerstone of Nigeria’s food and agro-allied sector.

Known for its flagship Golden Penny Food brand, FMN offers a broad spectrum of food products and boasts an extensive production, distribution, and supply chain network nationwide.

According to the group, gross profit also saw a significant upturn, jumping by 54% to ₦273 billion (US$175.4), a testament to FMN’s effective portfolio management, innovative product offerings, strategic pricing, and cost optimization strategies.

Operating profit mirrored this success, with a 61% increase reaching NGN208 billion (US$134M), underscoring the company’s strong financial health.

FMN’s financial statement further revealed a notable 90% rise in Profit Before Tax and the impact of foreign exchange as well as a formidable net cash balance of ₦176 billion (US$116.5M), positioning it well to pursue growth opportunities and manage debt repayments efficiently.

Speaking on the performance, Boye Olusanya, Group Managing Director/Chief Executive Officer of FMN, expressed his satisfaction with the company’s robust performance.

“Despite challenging economic conditions, FMN has upheld its leadership in the Food and Agro-allied sector through our innovative products and efficient operations,” he stated.

Olusanya emphasized that the company’s financial and operational resilience stems from consistent execution and strategic growth initiatives.

The Agro-allied sector, in particular, exhibited strong performance, with a 17% revenue increase to NGN332 billion (US$222M) and profit before tax increasing by 42% to NGN14.3 billion (US$9.5M).

Higher export volumes, price adjustments, and new product introductions in the Fertilizer division drove this growth.

On his part, Anders Kristiansson, the Group’s Chief Finance Officer, highlighted FMN’s commitment to enhancing efficiencies and creating value aligned with their strategic vision. Reflecting this commitment, the Board approved a dividend of 180 kobo per share for shareholders.

FMN’s ability to generate substantial cash flow and reduce net debt has provided the flexibility to navigate economic uncertainties and seize growth opportunities.

The animal feed business also experienced robust growth, with a 23% rise in revenue and a 310% increase in profit before tax, driven by strengthened distributor partnerships, comprehensive farmer training programs, and enhanced customer and credit support.

The fourth quarter was particularly strong, bolstered by the acquisition of Port Harcourt Mills.

Revenue for the quarter surged by 72% to NGN732.4 billion (US$489.5M), up from NGN426 billion (US$284.7M) in the previous year. During this period, the Food segment generated NGN470 billion (US$314M) in revenue, a 70% year-on-year increase.

Looking forward, FMN anticipates continued macroeconomic challenges in 2024-25. The company plans to pursue new strategic partnerships and collaborations to drive innovation, expand product offerings, and penetrate high-growth markets within Africa, leveraging its robust brands and distribution network.

“We will continue to drive down the debt to optimize our capital structure and reduce financing costs, further improving profitability and delivering long-term value to our shareholders,” FMN stated.

“We have a strong pipeline of innovative products set to launch, tailored to meet changing consumer demands, support mixed volume growth, and drive higher margins.”

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