Honeywell Flour Reports 90% Profit Slump In Troubled 9-Month

For shareholders of Honeywell Flour Mills, this sure is not the best of times, judging by the unaudited financials for the six-month ended September 30, 2018, showing a drop in sales revenue, while cost of sales remained flat and a rise in sell/administrative expense, which among others, result in 90% drop in profit.
Revenue for the period dropped by 7.43% to N36.222bn, from N39.131bn in the prior half-year, with the lion’s share of N30.455bn from the company’s Apapa factory, down from N32.852bn; while N5.767bn came from the Ikeja plant, as against the previous N6.279bn.
Cost of sales stood at N29.747bn, as against the previous N29.996bn; resulting in gross profit of N6.475bn, 29.12% lower than N9.135bn previously.
A breakdown showed that while the Apapa plant reported an operating profit of N2.856bn, far from the previous N6.067bn; just the Ikeja plant suffered a loss of N818m, compared to the loss of N732m in the prior half-year.
Other income for the period rose 33.33% up from N84m to N112m; selling and administrative expenses rose 17.12% from N3.884bn to N4.549bn; just as finance cost stood at N1.785bn, from N2.567bn, representing a 30.46% decline.
Profit before tax suffered a 90.86% setback from N2.768bn in 2017, to just N253m. Tax expense for the period dropped 95% down from N554m in the six months of 2017, to N30m; Net profit therefore slowed down by 89.93% to N223m, or 2.81 kobo Earnings Per Share; compared to N2.214bn, or 27.92 kobo each.