By Nkiruka Nnorom
Flour Mills of Nigeria, FMN, Plc has reported Group profit after tax of N14.4 billion for its year ended March 31, 2016, representing 71.4 per cent growth over N8.4 billion posted in the year ended 2015. The company also recorded 49 per cent increase in its pre-tax profit to N11.5 billion from N7.7 billion a year earlier, while its revenue grew by 11 per cent from N308 billion to N342 billion during the year.
Following the performance, the Board of Directors has proposed N2.62 billion gross dividends, which translates to N1.00 per ordinary share of 50 kobo each. Commenting on the result, Mr. Paul Gbededo, the Group Managing Director, FMN, explained that the company’s cost of sales was impacted by higher cost of foreign currency due to foreign market deregulation resulting in closing blended exchange rate of N295 to $1 as against CBN rate of N197. 50. Nevertheless, the company was able to offset the impact of the foregoing on its bottom-line only by gradual increases in selling prices of its products, Gbededo said.
According to him, the strong improvement in revenue and profitability was primarily driven by volume growth and efficiency gains, while benefits arising from the sale of investment in United Cement Company of Nigeria, UNICEM, helped to improve the bottom line.
“The good news is that management is determined to further restructure our operations, streamline our business operations to focus on core businesses and constantly monitor and manage our costs optimally to hedge against further economic challenges which might evolve. It is also noteworthy that management is resolute in ensuring that sustainable returns and dividends from the Group’s agro allied investments are properly harnessed by maximizing local content in the Group’s products, bye- products and processes,” he said.
FMN continues to be one of the major promoters of the Agricultural Transformation Agenda of the Federal Government with its on-going agro-allied investments aimed at creating jobs and stimulating economic activities in urban and rural areas. FMN’s goal is to be involved at all stages of the food value chain where a profitable and sustainable Agro-Allied platform of cultivating and processing locally produced raw materials will ensure the growth and success of our food business, he added.