With about N20.77billion foreign exchange losses, Cadbury Nigeria Plc has declared N14.52 billlion loss before tax in half year (H1) ended June 30, 2023 as against N3.35billion profit before tax reported in half year (H1) ended June 30, 2022.
The Fast-Moving Consumer Goods (FMCG) company listed on the Nigerian Exchange Limited (NGX) also declared N14.54 billion loss in H1 2023 from N2.34 billion profit after tax reported in H1 2022.
The company’s decline in profits can be attributable to the write-down the management took due to the impact of the unification of the naira on its loans.
The company carries foreign exchange-related loans with dollar-denominated interest rate components that triggered the losses. The depreciation of the Naira from about N460 against the dollar to about N790 against the dollar triggered the foreign exchange losses in the period under review.
In terms of revenue, Cadbury Nigeria declared N35.61billion revenue in H1 2023, a growth of 27.7 per cent from N27.88billion reported in H1 2022.
Revenue generated in Nigeria stood at N34.89billion in H1 2023, an increase of 29.34per cent from N26.98billion in H1 2022, while export sales closed H1 2023 at N714.49million, a drop of 21 per cent from N2898.9million reported in H1 2022.
Cost of sales stood at N25.38 billion in H1 2023 from N22.02 billion in H1 2022 to position its gross profit at N10.23 billion in H1 2023 from N5.85 billion in H1 2022.
Amid the losses arising from the extraordinary foreign exchange losses, the multinational company posted an operating profit of N6.07 billion, representing a 113.2 per cent increase from N2.85billion in H1 2022.
The company suffered a significant increase in its operating expenses amid a double-digit inflation rate.
Total operating expenses closed H1 2023 at N4.16billion, a growth of 37.4 per cent from N3.03billion reported in H1 2022.
While commenting on 2022 financial year results, Managing Director, Cadbury Nigeria, Mrs. Oyeyimika Adeboye, in a statement said the company continued to push the boundaries to sustain its current growth trajectory in a tough business environment.
Adeboye said. “We will keep finetuning our strategies to manage these challenges, in line with our mission, which is focused on nourishing and delighting our consumers with the right snacks, while remaining committed to our stakeholders and doing what is right for our environment.”
Investors responded at the company’s stock price depreciated by N1.70 or 10 per cent to N15.3 per share.