KEY POINTS
- BUA Foods recorded N450.47 billion profit after tax for the nine months ended September 2026, an 11% increase year on year.
- Gross profit rose to N552.90 billion from N520.65 billion.
- Gross profit margin expanded to 48.3% from 36.7%, supported by lower cost of sales.
- Revenue declined 19% to N1.15 trillion, while cost of sales fell 34% to N592.94 billion.
- Operating expenses dropped 20% to N66.99 billion.
MAIN STORY
BUA Foods Plc increased its profit after tax by 11% to N450.47 billion in the nine months ended September 30, 2026, despite a 19% decline in revenue, as lower production costs and operating expenses strengthened its profit margins.
The company’s unaudited financial results showed that profit after tax rose from N405.27 billion in the corresponding period of 2025. Gross profit also increased to N552.90 billion from N520.65 billion.
The improvement was more pronounced in gross profit margin, which expanded to 48.3% from 36.7% a year earlier.
BUA Foods attributed the stronger profitability to cost optimisation, improved productivity and a more stable foreign exchange environment. Its cost of sales declined by 34% to N592.94 billion during the period.
Operating expenses also fell by 20% to N66.99 billion, compared with N83.65 billion in the corresponding period of 2025.
Selling and distribution expenses dropped by 15% to N45.04 billion, while administrative expenses declined by 28% to N21.95 billion.
These reductions supported a 12-percentage-point increase in operating profit margin to 43%, from 31% in the previous year.
Profit before tax grew by 11% to N480.52 billion, while earnings per share increased by 11% to N25.03, compared with N22.52 in the corresponding period of 2025.
However, revenue declined by 19% to N1.15 trillion, reflecting softer pricing conditions and subdued consumer demand, according to the company’s Managing Director, Engr. Ayodele Abioye.
THE ISSUES
BUA Foods’ results highlight the difference between revenue growth and profitability. Although the company generated less revenue than it did in the corresponding period of 2025, its profits increased because production and operating costs declined more sharply.
The 34% reduction in cost of sales was particularly significant, helping gross profit rise despite the lower revenue.
For investors, the figures show improved margins and earnings per share. However, the revenue decline raises questions about sales volumes, pricing pressure and the extent to which cost reductions can continue to support profitability if consumer demand remains subdued.
The company’s ability to maintain these margins while rebuilding revenue will be important to its performance in subsequent reporting periods.
WHAT’S BEING SAID
“Our nine-month 2026 results demonstrate the resilience of BUA Foods’ operating model and the benefits of disciplined cost and margin management.” – Engr. Ayodele Abioye, Managing Director, BUA Foods Plc.
“Despite a 19% decline in revenue to N1.15 trillion, driven by softer pricing conditions and subdued consumer demand, we maintained a substantial improvement in profitability through effective cost optimisation, improved productivity and rigorous execution across the business.” – Engr. Ayodele Abioye, Managing Director, BUA Foods Plc.
WHAT’S NEXT
Abioye said the company would continue to focus on profitable growth, wider market penetration and operational efficiency.
He also identified the strength of its brands and investment in route-to-market capabilities as part of its strategy for future growth.
BOTTOM LINE
BUA Foods increased its nine-month profit despite lower revenue, supported by significant reductions in production and operating costs. The next test will be whether the company can sustain its improved margins while addressing weaker consumer demand and declining revenue.
