Post Views: 341 The board of Honeywell Flour Mills Plc, on Monday hinted that all may not be well after all with the company, just as there would be n...
The board of Honeywell Flour Mills Plc, on Monday hinted that all may not be well after all with the company, just as there would be no honey for shareholders who will not be receiving any dividend from their investments, when they gather for the annual general meeting already slated for Thursday, September 26, 2019 in Lagos. Arising from these, the value of their investment in the company on the Nigerian Stock Exchange (NSE), (market capitalisation) dropped from N20.222bn at the end of 2018 full-year on March 31, 2018, to just N9.516bn, representing a 53% drop.
Revenue for the period was flat after rising by a marginal 4% from N71.476bn in 2018 to N74.409bn in the corresponding full-year ended March 31, 2019; cost of sales increased by 13.48% from N55.423bn in 2018 to N62.899bn; which left gross profit at N11.509bn, down from N16.052bn in the period under review; while the Ikeja plant contributed N12.267bn to revenue, while its N10.396bn cost of sales yielded gross profit of N1.869bn.
Segment information shows that the lion’s share of revenue for the period came from Honeywell’s Apapa facility, which continued N62.141bn to turnover, just as last year, while cost of sales at N19.398bn resulted in gross profit of N1.869bn.
A breakdown of the cost of sales showed that cost of raw and packaging materials at N55.293bn, compared to N48.103bn, among others.
Other income increased from N202.217m from N751.469m, out of which sale of by-products rose to N175.078n from N120.193m; while net gains on the sale of property, plant, and equipment stood at N501.647m, up from N4.651m, among others. Selling and distribution expenses rose to N6.017bn from N4.718bn; even as administrative expenses increased marginally to N2.326bn from N2.059bn. Operating profit, therefore, dropped by N5.56bn or 58.68% from N9.477bn in 2018, to N3.916bn.
With no finance income during the period, total and net finance costs stood at N3.308bn from N4.604bn.
Profit before tax, therefore, dropped to N607.791m, 88% when compared to the previous N4.872bn; while profit after tax stood at N68.368m, or 98% down from N4.872bn. Earnings Per Share stood at 0.86 kobo, compared to the previous 55.82 kobo reported in 2018. The directors say their decision not to declare a dividend arises from the need “to conserve fund.”