Flour Mills of Nigeria Plc Reports Growth in Profits and Strategic Moves in 2023

Flour Mills of Nigeria Plc, a prominent Foods and Agro Allied company, announced a notable 5.32 percent increase in its profit to N29.504 billion by the end of the financial period in March 2023.

This growth is higher than the N28.015 billion recorded during the same period in 2022.

In its recently filed Annual Report with the Nigerian Exchange Limited on Tuesday, the company also reported a 32 percent surge in revenue from N1.163 trillion to N1.539 trillion.

However, the unaudited financial results for the three months ending on June 30, 2023, revealed a loss of N9.337 billion for FMN. This contrasts with the N5.812 billion gain reported in 2022.

In accompanying notes, FMN Plc attributed the significant drop in operating profit to a foreign exchange loss of N22.5 billion in the last quarter, leading to a loss before tax of N9.3 billion.

The report stated, “Without the devaluation of the exchange rate, the operating profit would have increased by an impressive 52 percent. Management remains optimistic that with the current government monetary policies aimed at stabilizing the forex market and ongoing efforts in sales and marketing activities focused on boosting our top line while maintaining cost control, we anticipate a substantial improvement in profit generation in the upcoming period.”

Dividend and Financial Growth

The company’s board proposed a total dividend payout of N9.225 billion to shareholders, representing a five percent increase from the N8.815 billion paid at the end of March 2022.

This translated to a dividend of N2.25 per ordinary share of 50 kobo each, up from N2.15 in 2022.

During the review period, the company’s assets witnessed significant growth, surging by 64.47 percent to N1.097 trillion, compared to N667 billion in 2022. Total liabilities also increased by 85.13 percent, reaching N872.171 billion from N471.107 billion.

Strategic Acquisition

In a strategic move on May 12, 2022, FMN acquired 77.75 percent of the voting rights of Honeywell Flour Mills Plc. The company explained that this transaction aligns with FMN Group’s global growth strategy, aiming to create a more robust and resilient national champion for Nigeria and enhance food security.

The acquisition combines the unique strategic strengths of both companies, providing customers with access to a wider range of innovative products and enabling FMN to expand its group operations.