For the fiscal year 2021, UAC Nig Plc reports a 33% drop in profit

UAC Nig Plc has announced its audited financial results for the full year ending December 2021, displaying a profit of N2.59 billion, a decrease of 33% from the prior-year period, despite a 25% increase in revenue.

Inflationary forces affected both consumers and producers during the time under consideration, resulting in a steady rise in the price of goods and services. As a result, producers faced large increases in the cost of raw materials as well as overall production expenses.

Although the company grew sales due to double-digit food inflation, manufacturing and financing cost increased by a staggering 28 percent and 194 percent, respectively, during the period under review, reducing bottom-line earnings.

Highlights of the conclusion

The firm operates five primary areas, including Animal feeds, Paints, Food and Beverages, Quick Service Restaurants, and Others, according to a preliminary examination of the results.

Animal feeds accounted for 60% of total revenue, producing N62 billion, making it the most profitable segment. Food and Beverage was the second-highest revenue generator, bringing in N24 billion, or 23% of total sales. The remaining 17 percent of income came from the Paints, Quick Service Restaurants, and Other sectors.

Bank deposit interest income was N907 million in 2018, compared to N1.05 billion in 2020. The group also got N301 million in interest on Eurobonds.

Furthermore, the company profited from gains on investment properties, earning a total of N1.14 billion throughout the financial year.

High sales costs, as well as selling, distribution, and administrative expenses impacted UAC Nig Plc's revenue performance for the period, which had a trickle-down effect on profit.

A closer examination of the financial figures revealed that the group's total assets have increased to N98.46 billion, but net assets have decreased by 16.21% to N50.84 billion. The group's long-term debt was N339 million.

For the quarter, UAC Nig Plc's earnings per share (EPS) were N0.63, down 8.70 percent from N0.69 in FY 2020.

The company's stock last traded at N12.10 per share, up 27.37 percent year to date.